~~[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934~~

~~For the quarterly period ended March 31, 2017 or~~

[ ]	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the transition period from _________ to _________ .

~~[ ]~~~~Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934~~

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ✔ No_____

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date.

1. Basis of Presentation

The accompanying condensed consolidated balance sheet of Gray Television, Inc. (and its consolidated subsidiaries, except as the context otherwise provides,“Gray,” the “Company,” “we,” “us,” and “our”) as of December 31, ~~2016,~~ 2017, which was derived from the Company’s audited financial statements as of December 31, ~~2016,~~ 2017, and our accompanying unaudited condensed consolidated financial statements as of March 31, ~~2017~~ 2018 and for the periods ended March 31, ~~2017~~ 2018 and ~~2016,~~2017, have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form ~~10-Q~~10-Q and Article 10 of Regulation ~~S-X.~~S-X. Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to those rules and regulations, although we believe that the disclosures made are adequate to make the information not misleading. In our opinion, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. Our operations consist of one reportable segment. For further information, refer to the consolidated financial statements and footnotes thereto included in our Annual Report on Form ~~10-K~~10-K for the year ended December 31, ~~2016 (the “2016~~2017 (the “2017 Form ~~10-K”~~10-K”). Our financial condition as of, and operating results for the ~~three-month period~~three-months ended March 31, ~~2017~~ 2018, are not necessarily indicative of the financial condition or results that may be expected for any future interim period or for the year ending December 31, ~~2017.~~2018.

Overview

We are a television broadcast company headquartered in Atlanta, Georgia, that owns ~~and/or~~and operates television stations and leading digital assets in markets throughout the United States. As of March 31, ~~2017,~~ 2018, we owned ~~and/or~~and operated television stations in 5457 television markets broadcasting over 200 separate programming streams, including over 100 channels affiliated with the CBS Network (“CBS”), the NBC Network (“NBC”), the ABC Network (“ABC”) and the FOX Network (“FOX”). As of March 31, ~~2017,~~ 2018, our station group reached approximately ~~10.1%~~10.4% of total United States television households.

Revenue Recognition

We recognize revenue when we have completed a specified service and effectively transferred the control of that service to a customer in return for an amount of consideration we expect to be entitled to receive. The amount of revenue recognized is determined by the amount of consideration specified in a contract with our customers. We have elected to exclude taxes assessed by a governmental authority on transactions with our customers from our revenue. Any unremitted balance is included in current liabilities on our balance sheet.

Cyclicality and Seasonality

Broadcast advertising revenues are generally highest in the second and fourth quarters each year. This seasonality results partly from increases in consumer advertising in the spring and retail advertising in the period leading up to and including the holiday season. Broadcast advertising revenues are also typically higher in even-numbered years due to increased spending by political candidates, political parties and special interest groups ~~in advance~~during the “on-year” of ~~elections.~~the two year election cycle. This political spending typically is heaviest during the fourth quarter. In addition, the broadcast of Olympic Games by our NBC affiliated stations during even-numbered years generally leads to increased viewership and revenue during those years.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires our management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and ~~the notes to the unaudited condensed consolidated financial statements.~~related notes. Our actual experience and accordingly, our results could differ materially from these estimates. The most significant estimates we make relate to our allowance for doubtful accounts in receivables, valuation of goodwill and intangible assets, amortization of program broadcast rights and intangible assets, pension costs, income taxes, employee medical insurance claims, useful lives of property and equipment and contingencies.

~~Variable Interest Entit~~y

We consolidate a VIE when we are determined to be the primary beneficiary. In accordance with U.S. GAAP, in determining whether we are the primary beneficiary of a VIE for financial reporting purposes, we consider whether we have the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and whether we have the obligation to absorb losses or the right to receive returns that would be significant to the VIE.

On January 17, 2017, we acquired two television stations that were divested by Nexstar Broadcasting, Inc. upon its merger with Media General, Inc. (“Media General”): WBAY-TV (ABC), in the Green Bay, Wisconsin television market, and KWQC-TV (NBC), in the Davenport, Iowa, Rock Island, Illinois, and Moline, Illinois or “Quad Cities” television market, for an adjusted purchase price of $269.9 million (the “Media General Acquisition”) using cash on hand. The Media General Acquisition was completed, in part, through a transaction with Gray Midwest EAT, LLC (“GME”), pursuant to which, we loaned GME $106.0 million that GME in turn used to acquire the broadcast licenses of the stations. Under the terms of our agreement with GME, we hold an option to acquire either the broadcast licenses held by GME or the equity ownership interests of GME for the same purchase price paid by GME for the property, net of the remaining balance owed to us by GME (the “Option”). The agreement includes both put and call provisions that also may require us to acquire the property following receipt of certain approvals from the Federal Communications Commission (the “FCC”).

Based on the terms of our agreements with GME, the significance of the Media General Acquisition’s broadcast licenses, the terms of our option with GME and our loan to GME, we have determined that GME is a VIE of Gray. We believe we are the primary beneficiary of GME because, subject to the ultimate control of the licensees, we have the power to direct the activities that significantly impact the economic performance of GME through the services we provide, and our obligation to absorb losses and earn returns that would be considered significant to GME. As a result, we included the assets, liabilities and results of operations of GME in our consolidated financial statements beginning January 17, 2017, and continuing for so long as we remain the primary beneficiary.

~~The carrying amounts and classification of the assets and liabilities of GME included in our condensed consolidated balance sheets as of March 31, 2017 are as follows (in thousands):~~

March 31,

2017

Assets:

Broadcast licenses
$ 149,846
Total assets
$ 149,846

Liabilities:

Current liabilities:

Accrued liability for option exercise
$ 43,846
Note payable
106,000
Total current liabilities
149,846
Total liabilities
$ 149,846

The terms of the Option provide for the acquisition of the license assets of GME at an exercise price that was less than the carrying value of such assets as of March 31, 2017. The assets of GME can only be used to settle the obligations of GME and may not be sold, or otherwise disposed of, except for assets sold or replaced with others of like kind or value. A note payable of $106.0million representing our loan to GME, and an accrued liability of $43.9 million representing the fair value of the Option, as of March 31, 2017, were eliminated in our condensed consolidated financial statements.

Earnings Per Share

We compute basic earnings per share by dividing net income by the weighted-average number of our common shares and Class A common shares outstanding during the relevant period. The weighted-average number of shares outstanding does not include restricted shares. These shares, although classified as issued and outstanding, are considered contingently returnable until the restrictions lapse and, in accordance with U.S. GAAP, are not included in the basic earnings per share calculation until the shares vest. Diluted earnings per share is computed by including all potentially dilutive shares, including restricted shares and shares underlying stock options, in the denominator of the diluted weighted-average shares outstanding calculation, unless their inclusion would be antidilutive.

The following table reconciles basic weighted-average shares outstanding to diluted weighted-average shares outstanding for the ~~three-month periods~~three-months ended March 31, ~~2017~~ 2018 and ~~2016~~2017, respectively (in thousands):

Three Months Ended

Three Months Ended

March 31,

March 31,

2017

2016

2018

2017

Weighted-average shares outstanding-basic

71,877

71,791

89,058

71,877

Common stock equivalents for stock options and restricted stock

642

791

518

642

Weighted-average shares outstanding-diluted

72,519

72,582

89,576

72,519

Accumulated Other Comprehensive Loss

Our accumulated other comprehensive loss balances as of March 31, ~~2017,~~ 2018 and December 31, ~~2016,~~ 2017, consist of adjustments to our pension liability and the related income tax ~~effect.Our~~effect. Our comprehensive income for the ~~three-month periods~~three-months ended March 31, ~~2017~~ 2018 and ~~2016~~2017 consisted entirely of net income. Therefore, a consolidated statement of comprehensive income is not presented for the ~~three-month periods~~three-months ended March 31, ~~2017~~ 2018 or ~~2016.~~2017.

~~Pro~~Pr~~perty~~operty and Equipment

Property and equipment are carried at cost. Depreciation is computed principally by the straight-line method. The following table lists the components of property and equipment by major category (dollars in thousands):

Estimated

March 31,

December 31,

Useful Lives

2018

2017

(in years)

Property and equipment:

Land

51,946

50,458

Buildings and improvements

156,973

156,924

Equipment

516,251

511,878

725,170

719,260

Accumulated depreciation

(381,992

)

(368,602

)

Total property and equipment, net

343,178

350,658

Maintenance, repairs and minor replacements are charged to operations as incurred; major replacements and betterments are capitalized. The cost of any assets divested, sold or retired and the related accumulated depreciation are removed from the accounts at the time of disposition, and any resulting profit or loss is reflected in income or expense for the period.

In April 2017, the ~~three-month period ended March 31, 2017,~~Federal Communications Commission (the “FCC”) began a process of reallocating the broadcast spectrum (the “Repack”). Specifically, the FCC is requiring certain television stations to change channels and/or modify their transmission facilities. The legislation authorizing the Repack provides the FCC with a $1.7 billion fund to reimburse reasonable costs incurred by stations operating under a full power license that are reassigned to new channels. Twenty-six of our ~~total property~~current full power stations and ~~equipment balance, before accumulated depreciation, increased approximately $23.1 million as a result~~five of our low power stations are affected by the Repack. We expect to receive reimbursements for the majority of our expenses related to the Repack of our full power stations. However, we cannot predict whether the fund will be sufficient to reimburse all of our expenses.

The following tables provide additional information related to (gain) loss on disposal of assets, net included in our condensed consolidated statements of operations and purchases of property and equipment ~~acquired~~included in ~~connection with acquisitions~~our condensed consolidated statements of ~~television stations in the period. The remaining changes in the balances in the three-months ended March 31, 2017 were due to routine property and equipment purchases and retirements.~~

~~The following table lists the components of property and equipment by major category (dollars in~~cash flows (in thousands):

Estimated

March 31,

December 31,

Useful Lives

2017

2016

(in years)

Property and equipment:

Land
$ 48,421 $ 44,611
Buildings and improvements
145,077 139,078 7 to 40
Equipment
487,667 471,798 3 to 20
681,165 655,487
Accumulated depreciation
(341,181 ) (329,394 )
Total property and equipment, net
$ 339,984 $ 326,093

	Three Months Ended
	March 31,
	2018			2017
(Gain) loss on disposal of assets, net:
Proceeds from sale of assets	$	(41	)	$	(50	)
Proceeds from FCC - Repack		(937	)		-
Net book value of assets disposed		157			577
Total	$	(821	)	$	527

Purchase of property and equipment:
Recurring purchases - operations	$	4,292		$	3,977
Repack		1,988			-
Total	$	6,280		$	3,977

Allowance for Doubtful Accounts

Our allowance for doubtful accounts is equal to a portion of our receivable balances that are 120 days old or older. We may provide allowances for certain receivable balances that are less than 120 days old when warranted by specific facts and circumstances. We generally write-off accounts receivable balances when the customer files for bankruptcy or when all commonly used methods of collection have been exhausted.

Recent Accounting Pronouncements

In ~~May 2014,~~ February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ~~No. 2014-09, Revenue from Contracts with Customers~~2016-02 – Leases (Topic ~~606)~~842). ASU ~~2014-09 provides new~~2016-02 will supersede Topic 840,Leases, and thus will supersede nearly all existing lease guidance by requiring the reclassification of lease assets and lease liabilities on ~~revenue recognition for revenue from contracts with customers~~the balance sheet and ~~will replace most existing revenue recognition guidance when it becomes effective. This guidance requires an entity to recognize the amount~~requiring disclosure of ~~revenue to which it expects to be entitled for the transfer of promised goods or services to customers.~~key information about leasing arrangements. The standard is intended to improve comparability of revenue recognition practices across entities and provide more useful information through improved financial statement disclosures. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606):~~Deferral of the Effective Date~~~~. ASU 2015-14 deferred the~~will be effective ~~date of ASU 2014-09 by one year to interim and annual reporting periods~~for fiscal years beginning after December 15, ~~2017, and permitted early adoption of the~~2018. This standard ~~but not before the original effective date of December 15, 2016. The standard permits the use of either a retrospective~~is expected to each reporting period presented method, or a retrospective with the cumulative effect method to adopt the standard. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606):~~Identifying Performance Obligations and Licensing~~. This ASU amends the guidance of ASU 2014-09 to clarify the identification of performance obligations and to provide additional licensing implementation guidance. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606):~~Narrow Scope Improvements and Practical Expedients~~. This ASU was issued to provide guidance in assessing collectibility, presentation of sales taxes, noncash consideration, and completed contracts and contract modifications at transition, in order to reduce the potential for diversity in practice at initial application, and to reduce the cost and complexity of applying the standard. In December 2016, the FASB issued ASU 2016-20, Revenue from Contracts with Customers (Topic 606):~~Technical Corrections and Improvements~~~~. This ASU was issued to clarify the standard and to correct unintended application of guidance. We have preliminarily determined that the adoption of this standard will not~~ have a material effect on our balance ~~sheets and statements of operations. We have not yet determined which method of adoption~~sheets. Specifically, we expect that, once adopted, we will record a right of use ~~when we implement~~ asset and lease obligation liability. As of December 31, 2017, the ~~standard.~~values of those assets and related liabilities were each approximately $17.6 million. We are also evaluating our footnote ~~disclosures and expect that~~disclosure requirements. We are continuing to review our contractual obligations related to this standard, ~~will have an effect on these disclosures. We will continue to~~and develop ~~these~~our disclosures, ~~and the related tasks of gathering data to be disclosed,~~ assessing our internal controls and availing ourselves of broadcasting industry related guidance.

In January ~~2016,~~ 2017, the FASB issued ASU 2017-04,Intangibles – Goodwill and Other (Topic 350) – Simplifying the Test for Goodwill Impairment. ASU 2017-04 amends the guidance of U.S. GAAP with the intent of simplifying how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. After adoption of the standard, the annual, or interim, goodwill impairment test will be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized will not exceed the total amount of goodwill allocated to that reporting unit. The standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The standard allows for early adoption, but we have not yet made a determination as to whether to early-adopt this standard. We do not expect that the adoption of this standard will have a material impact on our financial statements.

In February 2018, the FASB issued ASU 2018-02,Income Statement - Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (“TCJA”). Consequently, the amendments eliminate the stranded tax effects resulting from the TCJA and will improve the usefulness of information reported to financial statement users. However, because the amendments only relate to the reclassification of the income tax effects of the TCJA, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The standard allows for early adoption, but we have not yet made a determination as to whether to early-adopt this standard. We do not expect that the adoption of this standard will have a material impact on our financial statements.

Adoption of Accounting Standards and Reclassifications

In January 2016, the FASB issued ASU No. ~~2016-01,~~ 2016-01 – Financial Instruments - Overall (Subtopic ~~825-10)~~ 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities. ASU ~~2016-01~~2016-01 amends the guidance in U.S. GAAP regarding the classification and measurement of financial instruments. The new standard significantly revises an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. ~~The standard~~ASU 2016-01 requires equity investments previously measured at cost to be measured at fair value with changes in fair value recognized in net income. However, equity investments without a readily determinable fair value may be measured using a prescribed measurement alternative that reflects current fair value with changes in the current fair value recognized in net income and includes a qualitative evaluation of impairment. In February 2018, the FASB issued ASU No.2018-03 – Technical Corrections and Improvements to Financial Instruments-Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2018-03 clarifies certain aspects of the guidance issued in ASU 2016-01. ASU 2018-03 is effective for ~~fiscal years~~interim periods beginning after ~~December~~June 15, ~~2017, including~~2018 but can be adopted early. We adopted the amendments in both updates concurrently beginning in the first quarter of 2018. We currently have equity investments in the television broadcasting industry that do not have readily determinable fair values. We have applied the measurement alternative as defined in the amendments. These investments are reported together as a non-current asset on our balance sheet. We evaluate these investments on an interim ~~periods within those fiscal years. We do not expect that~~basis for impairment. Accordingly, the adoption of this standard ~~will~~did not have a material impact on our financial statements.

In ~~February 2016,~~ March 2017, the FASB issued ASU ~~2016-02, Leases (Topic 842). ASU 2016-02 will supersede Topic 840,~~2017-07,~~Leases~~, and thus will supersede nearly all existing lease guidance by requiring the reclassification of lease assets and lease liabilities on the balance sheet and requiring disclosure of key information about leasing arrangements. The standard will be effective for fiscal years beginning after December 15, 2018. We have preliminarily determined that the adoption of this standard will not have a material effect on our statements of operations. However, this standard is expected to have a material effect on our balance sheets. Specifically, we expect that, once adopted we will record a right of use asset and lease obligation liability. Based on our current portfolio of lease obligations, we expect that this asset and liability would each total approximately $13.2 million. We are also evaluating our footnote disclosures and expect that this standard will have an effect on these disclosures. We will continue to develop these disclosures and the related tasks of gathering data to be disclosed, assessing our internal controls and availing ourselves of broadcasting industry related guidance.

~~In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) –~~~~Classification of Certain Cash Receipts and Cash Payments~~. ASU 2016-15 amends the guidance of U.S. GAAP with the intent of addressing eight specific cash flow issues with the objective of reducing the existing diversity in practice. One or more of these eight issues are applicable to our financial statements. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We do not expect that the adoption of this standard will have a material impact on our financial statements.

~~In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805) –~~~~Clarifying the Definition of a Business~~. ASU 2017-01 amends the guidance of U.S. GAAP with the intent of clarifying the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We do not expect that the adoption of this standard will have a material impact on our financial statements.

~~In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350) –~~~~Simplifying the Test for Goodwill Impairment~~. ASU 2017-04 amends the guidance of U.S. GAAP with the intent of simplifying how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The standard allows for early adoption, but we have not yet made that determination. We do not expect that the adoption of this standard will have a material impact on our financial statements.

~~In March 2017, the FASB issued ASU 2017-07,~~ Compensation – Retirement Benefits (Topic ~~715)~~715) -Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU ~~2017-07~~2017-07 amends the guidance of U.S. GAAP with the intent of improving the presentation of net periodic pension cost and net periodic postretirement benefit cost by prescribing where the amount of net benefit cost should be presented in an employer’s income statement and requiring the disclosure by line item of the amount of net benefit cost that is included in the income statement or capitalized in assets. ~~The~~We adopted this standard ~~is effective for fiscal~~beginning in the first quarter of 2018. Because our defined benefit pension plans were frozen in prior years, ~~beginning after December 15, 2017, including interim periods within those fiscal years. We do~~ we have not ~~expect that~~ incurred any service cost in our condensed consolidated statements of operations during the three months ended March 31, 2018 or 2017. Upon the adoption of this standard ~~will have a material impact on~~we reclassified our ~~financial statements.~~net pension expense (benefit), from our operating expenses to our miscellaneous income, net. The amount was not material.

~~Adoption~~In addition to the reclassification of ~~Accounting Standards and Reclassifications~~

~~In November 2015, the FASB issued ASU No. 2015-17, Income Taxes (Topic 740) –~~~~Balance Sheet Classification of Deferred Taxes~~~~. ASU 2015-17 requires a “noncurrent” presentation of all deferred income taxes. As required by~~ our ~~adoption of this standard, the affected amounts have been reclassified on~~pension expense (benefit) in our ~~balance sheets for all periods presented.~~

~~In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718) -~~~~Improvements to Employee Share-Based Payment Accounting.~~ ASU 2016-09 amended the guidance in U.S. GAAP with the intent of simplifying several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards, and classification on thecondensed consolidated statement of cash flows. Our adoption of this standard included an adjustment to record the impact on our deferred asset related to the net federal and state income tax deductions for grants, and subsequent vesting, of restricted stock in excess of our book basis expense. Accordingly, we have recorded adjustments to increase our deferred tax asset and our accumulated deficit,operations as of January 1, 2017, by approximately $1.1 million. Beginning in 2017, we will record similar net excess or deficit tax deductions as current tax benefit or expense and as reductions in the related income tax prepaid or payable, or deferred tax assets.

~~Certain~~described above, certain amounts in the condensed consolidated statement of cash flows have also been reclassified to conform to the current presentation.

Adoption of New Accounting Standard: ASC Topic 606, Revenue from Contracts with Customers

On January 1, 2018, we adopted Accounting Standards Codification (“ASC”) Topic 606 - Revenue from Contracts with Customers, as amended. We adopted this ASC using the modified retrospective method and as a result, comparative information has not been restated and continues to be presented as prescribed by the accounting standards in effect during the periods presented. This transition method was applied to all open contracts with customers at the time of adoption. The adoption of this ASC did not result in an impact on our current or historical results.

~~On January 13, 2017, we acquired KTVF-TV (NBC), KXDF-TV (CBS),~~The following table presents our revenue from contracts with customers disaggregated by type of service and ~~KFXF-TV (FOX) in the Fairbanks, Alaska television market, from Tanana Valley Television Company and Tanana Valley Holdings, LLC for $8.0 million (the “Fairbanks Acquisition”), using cash on hand.~~

~~As described above, on January 17, 2017, we completed the Media General Acquisition, for an adjusted purchase price of $269.9 million using cash on hand.~~

We refer to the acquisitions completed through March 31, 2017, collectively, as the “2017 Acquisitions.” The preliminary fair value estimates of the assets acquired, liabilities assumed and resulting goodwill of the 2017 Acquisitions are summarized as followssales channel (in thousands):

Broadcast advertising revenue is generated primarily from the broadcast of television advertising time to local, national and political advertisers. Most advertising contracts are short-term, and generally run only for a few weeks. Our performance obligation is satisfied when the advertisement is broadcast or appears on our stations’ websites or mobile applications. Advertising revenue is recognized when the performance obligation is satisfied and then billed to the customer in the ~~table above are based upon management’s preliminary estimates~~period the revenue is recognized. We have an unconditional right to receive payment of the ~~fair values using valuation techniques including income, cost~~amount billed generally within 30 days of the invoice date. Payment terms are expressly stated in our standard terms and conditions. The invoiced amount to be received is recorded in accounts receivable on our balance sheet.

We broadcast the customer’s advertisement either preceding or following a television station’s network programming and within local and syndicated programming. Broadcast advertising is sold in time increments and is priced primarily on the basis of a program’s popularity among the specific audience an advertiser desires to reach. In addition, broadcast advertising rates are affected by the number of advertisers competing for the available time, the size and demographic makeup of the market ~~approaches.~~served by the station and the availability of alternative advertising media in the market area. Broadcast advertising rates are generally the highest during the most desirable viewing hours, with corresponding reductions during other hours. The ~~fair value estimates~~ratings of a local station affiliated with a major network can be affected by ratings of network programming. Internet advertising is placed on our stations’ websites and mobile applications. These advertisements may be in the form of banner advertisements, pre-roll advertisements or video and other types of advertisements or sponsorships.

We generate advertising revenue either by the efforts of our direct sales employees or through third party advertising agency intermediaries. Third party advertising intermediaries represent the customer and contract with us to deliver broadcast or internet advertising for the customer.

We record revenue and expense for non-monetary trade transactions involving the exchange of tangible goods or services with our customers. The revenue is recorded at the time the advertisement is broadcast and the expense is recorded at the time the goods or services are used. The revenue and expense associated with these transactions are based on ~~but not limited to, expected future revenue and cash flows, expected future growth rates, and estimated discount rates.~~

~~Property and equipment are being depreciated over their estimated useful lives ranging from three years to 40 years.~~

Other intangible assets represent primarily the estimated fair values of retransmission agreements of $13.8 million and favorable income leases of $1.5 million. These intangible assets are being amortized over their estimated useful lives of 5.0 years for retransmission agreements and 13.4 years for favorable income leases.

~~Goodwill is calculated as the excess of the consideration transferred over~~ the fair value of the ~~identifiable net~~ assets ~~acquired~~or services received.

We enter into license agreements with cable, satellite, multichannel video programming distributors and ~~liabilities assumed,~~digital delivery system (or “OTT”) customers (collectively “MVPD”) that provide them the right to use our broadcast signal for retransmission across the MVPD system for an agreed period of time. These agreements represent a sales and ~~represents~~usage based functional intellectual property license based on the ~~future economic benefits expected~~number of subscribers to ~~arise from other intangible assets acquired that do not qualify~~the licensee’s delivery systems. Our performance obligation is to provide the licensee with access to our intellectual property when it is broadcast. The duration of the typical retransmission consent contract is three years. Retransmission consent revenue is recognized continuously during the period of the contract as we transmit our broadcast signal to the MVPD. The amount of revenue recognized is determined based upon a fixed rate per subscriber multiplied by the number of active subscribers to our MVPD customer systems for ~~separate recognition, including assembled workforce, as well as future synergies that we expect to generate from each acquisition.~~the given month. We bill our MVPD customers monthly over the life of the retransmission consent contract. We have ~~preliminarily~~an unconditional right to receive payment of the amount billed generally within 30 days from the invoice date. Payment terms are expressly stated in our retransmission consent contracts and standard terms and conditions. The invoiced amount to be received is recorded ~~$86.4~~in accounts receivable on our balance sheet.

Subscriber data necessary to calculate the amount of retransmission consent revenue to be recognized for the current month is not received until subsequent to that month. We estimate the current month retransmission consent revenue based upon the subscriber data from the most recent subscriber report by the MVDP. We record the estimate in the current month as retransmission consent revenue and then adjust the amount recorded in that month when we receive the actual subscriber data. We typically have monthly adjustments to our revenue to account for changes in MVPD subscribers on a monthly basis, however, the number of MVPD subscribers does not change materially on a monthly basis and this adjustment does not materially impact our recorded retransmission consent revenue on a quarterly or annual basis.

Other revenues consist of production, tower rental and other miscellaneous items. Production revenue is derived from the production of programming. Production revenue is recognized as the programming is produced. Tower rental income is recognized monthly over the life of the lease. All of our leases under which we are lessor are considered operating leases. Other revenue is comprised of one-time or infrequently occurring special projects, dubbing, fees and other miscellaneous items. Other revenue is recognized as the services are performed. Tower rental income is recognized monthly over the life of the lease. Other revenue is generated by our direct sales employees.

When we invoice our customers for completed performance obligations, we are unconditionally entitled to receive payment of the invoiced amounts. Therefore, we record invoiced amounts in accounts receivable on our balance sheet. We generally require amounts payable under advertising contracts with our political advertising customers to be paid for in advance. We record the receipt of this cash as a deposit liability. Once the advertisement has been broadcast, the revenue is earned, and we record the revenue and reduce the balance in this deposit liability account. We recorded $2.9 million of ~~goodwill related to 2017 Acquisitions. The use of different estimates or assumptions could result~~revenue in ~~materially different allocations. The goodwill recognized related to these acquisitions is deductible for income tax purposes.~~

~~Our consolidated results of operations for~~ the ~~three-months~~three months ended March 31, ~~2017 include the results of the 2017 Acquisitions from the date of each transaction. Revenue and operating income attributable thereto and~~2018 that was included in the deposit liability balance as of December 31, 2017. The deposit liability balance is included in deferred revenue on our condensed consolidated ~~statements of operations were $10.9~~balance sheets. The deposit liability balance was $4.4 million and ~~$2.8~~$3.8 million ~~respectively. In connection with the 2017 Acquisitions we incurred a total~~as of ~~$0.6 million of transaction related costs during the three-months ended~~ March 31, 2018 and December 31, 2017, ~~primarily related to legal, consulting and other professional fees.~~respectively.

We expense direct and agency commissions when incurred because our advertising contracts are one year or less in duration and the amortization period for capitalized expenses would be less than one year. Direct commissions are included in broadcast operating expense and agency commissions are netted against gross revenue on our condensed consolidated statements of operations.

The nature of our contracts with advertising customers is such that our performance obligations arise and are satisfied concurrent with the broadcast or web placement of the advertisement. We did not have incomplete or unsatisfied performance obligations at the end of any period presented. We record a deposit liability for cash deposits received from our customers that are to be applied as payment once the performance obligation arises and is satisfied in the manner stated above. These deposits are recorded as deposit liabilities on our balance sheet.

3. Long-term Debt

As of March 31, ~~2017~~ 2018 and December 31, ~~2016,~~ 2017, 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~~“2024 Notes”)and our 5.875% Senior Notes due 2026 (the ~~“2026~~“2026 Notes”),as follows (in thousands):

	March 31,			December 31,			March 31,			December 31,
	2017			2016			2018			2017
Long-term debt including current portion:
2014 Senior Credit Facility	$	-		$	556,438
Long-term debt:
2017 Senior Credit Facility		555,046			-		$	633,630		$	635,234
2024 Notes		525,000			525,000			525,000			525,000
2026 Notes		700,000			700,000			700,000			700,000
Total outstanding principal		1,780,046			1,781,438
Unamortized deferred loan costs - 2014 Senior Credit Facility		-			(12,158	)
Total outstanding principal, including current portion								1,858,630			1,860,234
Unamortized deferred loan costs - 2017 Senior Credit Facility		(13,609	)		-			(11,148	)		(11,777	)
Unamortized deferred loan costs - 2024 Notes		(7,493	)		(7,742	)		(6,494	)		(6,743	)
Unamortized deferred loan costs - 2026 Notes		(10,308	)		(10,588	)		(9,194	)		(9,473	)
Unamortized premium - 2026 Notes		5,644			5,797			5,034			5,187
Long-term debt, less deferred financing costs								1,836,828			1,837,428
Less current portion		(5,564	)		-			(6,417	)		(6,417	)
Net carrying value	$	1,748,716		$	1,756,747
Long-term debt, less current portion and deferred financing costs							$	1,830,411		$	1,831,011

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

On February 7, 2017, we entered into a Third Amended and Restated Credit Agreement (the ~~“2017~~“2017 Senior Credit Facility”). As of March 31, ~~2017,~~ 2018, the 2017 Senior Credit Facility provided total commitments of ~~$655.0~~$733.6 million, consisting of ~~a$555.0~~a $633.6 million term loan facility (the ~~“2017 Initial~~“2017 Term Loan”) and a ~~$100.0~~$100.0 million revolving credit facility (the ~~“2017~~“2017 Revolving ~~Credit Facility”). Amounts outstanding under the 2017 Term Loan were used to repay amounts outstanding under our prior credit agreement (the “2014 Senior~~ Credit Facility”).

~~Prior to~~For all of our interest bearing obligations, we made interest payments of approximately $26.7 million and $29.9 million during the ~~entry in to~~three-months ended March 31, 2018 and 2017, respectively. We did not capitalize any interest payments during 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 Decemberthree-months ended March 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~~2018 or 2017.

Borrowings under the ~~2014 Senior Credit Facility was 3.9%.~~

~~The~~ 2017 ~~Initial~~ Term Loan ~~borrowings~~ 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. ~~Until our results of operations for the quarter ending September 30, 2017 have been certified,~~Currently, the applicable margin is ~~2.50%~~2.25% for ~~all~~ LIBOR borrowings and ~~1.50%~~1.25% for ~~all~~ Base Rate ~~borrowings (the “Initial Applicable Margin”). Thereafter, (i) if the~~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 to 1.00, the applicable margin ~~will be~~ is 2.25% for all LIBOR borrowings and 1.25% for all Base Rate borrowings, and ~~(ii)~~ if the Leverage Ratio is greater than 5.25 to 1.00, the ~~Initial Applicable Margin will apply.~~applicable margin is 2.5% for all LIBOR borrowings and 1.5% for all Base Rate borrowings. As of March 31, ~~2017,~~ 2018, the interest rate on the balance outstanding under the 2017 ~~Senior Credit Facility was 3.3%. The 2017 Initial~~ Term Loan ~~also requires us to make quarterly principal payments of $1.4 million.~~was 3.9%.

Borrowings under the 2017 Revolving Credit Facility currently bear interest, at our option, ~~based on~~at either LIBOR plus 1.50% ~~to 2.00%~~ or ~~the~~ Base Rate plus 0.50% ~~to 1.00%~~, 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% to 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 ~~Initial~~ 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 ofapproximately $2.5 million in the first quarter of 2017, and we incurred approximately $4.6 million in deferred financing costs that will be amortized over the life of the 2017 Senior Credit Facility.

Subsequent to March 31, 2017, we entered into an amendment and incremental facility agreement to the 2017 Senior Credit Facility (the “2017 Incremental Term Loan” and, together with the 2017 Initial Term Loan, the “2017 Term Loan”). For additional information on the 2017 Incremental Term Loan, See Note 10 “Subsequent Events.”

As of March 31, 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 15 and October 15 of each year, commencing on April 15, 2017.

On June 14, 2016, we completed the private placement of $500.0 million of our 2026 Notes (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 March 31, 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 each 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 15 and July 15 of each year.

~~Collateral, Covenants and Restrictions~~

Our obligations under the 2017 Senior Credit Facility are secured by substantially all of our ~~and our~~ consolidated ~~subsidiaries'~~ 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. GME is not a guarantor of, and its assets are not pledged to secure our obligations under, the 2017~~ Senior Credit Facility. Gray Television, Inc. is a holding company, ~~with~~ and has no 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. ~~GME is not a guarantor~~Any subsidiaries of Gray Television, Inc. that do not guarantee the 2024 Notes ~~or the~~ and 2026 ~~Notes.~~ Notes are minor. As of March 31, ~~2017,~~ 2018, there were no significant restrictions on the ability of Gray Television, Inc.'s subsidiaries to distribute cash to ~~Gray.~~Gray or to the guarantor subsidiaries.

The 2017 Senior Credit Facility contains affirmative and restrictive covenants with which we must comply, including: (a) limitations on additional ~~indebtedness;~~indebtedness, (b) limitations on ~~liens;~~liens, (c) limitations on the sale of ~~assets;~~assets, (d) limitations on ~~guarantees;~~guarantees, (e) limitations on investments and ~~acquisitions;~~acquisitions, (f) limitations on the payment of dividends and share ~~repurchases;~~repurchases, (g) limitations on ~~mergers;~~mergers and (h) maintenance of ~~a first lien leverage ratio not to exceed certain maximum limits~~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 March 31, ~~2017~~ 2018 and December 31, ~~2016,~~ 2017, we were in compliance with all required covenants under all our debt obligations.

~~Aggregate minimum principal maturities on long-term debt as of March 31, 2017 were as follows (in thousands):~~

For all of our interest bearing obligations, we made interest payments of approximately $29.9 million and $7.7 million during the three-month periods ended March 31, 2017 and 2016, respectively. We did not capitalize any interest payments during the three-month periods ended March 31, 2017 or 2016.

For purposes of determining a fair value measurement, we utilize market data or assumptions that market participants would use in pricing an asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable. We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized into a hierarchy that gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (“Level 1”) and the lowest priority to unobservable inputs that require assumptions to measure fair value (“Level 3”). Level 2 inputs are those that are other than quoted prices on national exchanges included within Level 1 that are observable for the asset or liability either directly or indirectly (“Level 2”).

We have equity investments in privately held broadcasting and technology companies for which there is no readily determinable fair value. As such, we have elected the measurement alternative to measure our equity investments as provided by ASC Topic 321. The measurement alternative is intended to reflect current fair value by taking the cost basis of each investment and subtracting impairment, if any, while adding or subtracting changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.

The carrying amount of our equity investments without readily determinable fair values was $16.6 million as of each of March 31, 2018 and December 31, 2017. There were no impairment charges or changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer for the period ended March 31, 2018.

The estimated fair value of other financial instruments is determined using market information and appropriate valuation methodologies. Interpreting market data to develop fair value estimates involves considerable judgment. The use of different market assumptions or methodologies could have a material effect on the estimated fair value amounts. Accordingly, the estimates presented are not necessarily indicative of the amounts that we could realize in a current market exchange, or the value that ultimately will be realized upon maturity or disposition.

The carrying amounts of the following instruments approximate fair value due to their short term to maturity: (i) accounts receivable, (ii) prepaid and other current assets, (iii) accounts payable, (iv) accrued employee compensation and benefits, (v) accrued interest, (vi) other accrued expenses, (vii) acquisition-related liabilities and (viii) deferred revenue.

The carrying amount of our long-term debt was ~~$1.7~~$1.8 billion and ~~$1.8billion,~~$1.8 billion, respectively, and the fair value was ~~$1.8~~$1.8 billion and ~~$1.8billion,~~$1.9 billion, respectively, as of March 31, ~~2017~~ 2018 and December 31, ~~2016.~~ 2017. Fair value of our long-term debt is based on observable estimates provided by third party financial professionals as of March 31, ~~2017~~ 2018 and December 31, ~~2016,~~ 2017, and as such is classified within Level 2 of the fair value hierarchy.

As of March 31, 2018, we were authorized to issue 135.0 million shares in total of all classes of stock consisting of 100.0 million shares of common stock, 15.0 million shares of Class A common stock and 20.0 million shares of preferred stock, for which our board has the authority to determine the rights, powers, limitations and restrictions. On May 7, 2018, we filed an amendment to our Restated Articles of Incorporation increasing the number of shares of common stock and Class A common stock authorized for issuance thereunder to 200.0 million shares and 25.0 million shares, respectively. As of March 31, 2018, we had outstanding 82.0 million shares of common stock and 6.7 million shares of Class A common stock. No shares of preferred stock were outstanding. The rights of our common stock and Class A common stock are identical, except that our Class A common stock has 10 votes per share and our common stock has one vote per share on all matters submitted to a vote of our shareholders. Our common stock and Class A common stock are entitled to receive cash dividends if declared, on an equal per-share basis. For the three months ended March 31, 2018 and 2017, we did not declare or pay any common stock or Class A common stock dividends.

In each of March and November 2004, the Board of Directors of the Company authorized the Company to repurchase up to 2.0 million shares of the Company's common stock and Class A common stock. In March 2006, this authorization was increased to an aggregate of 5.0 million shares (the “2004-2006 Repurchase Authorization”). As of March 31, 2018, 279,200 shares remain available for repurchase under this authorization, which has no expiration date. On November 6, 2016, the Board of Directors of the Company authorized the Company to purchase up to an additional $75.0 million of our outstanding common stock prior to December 31, 2019 (the “2016 Repurchase Authorization”).

The 2016 Repurchase Authorization prohibits the Company from purchasing shares directly from the Company’s officers, directors, or the Gray Television, Inc. Capital Accumulation Plan (the “401(k) plan”). During the three-months ended March 31, 2018, under the 2016 Repurchase Authorization, we purchased 1,551,710 shares of our common stock at an average purchase price, including related brokerage commissions, of $12.64 per share, for a total cost of $19.6 million. As of March 31, 2018, $49.5 million remains available to purchase shares under the 2016 Repurchase Authorization.

The extent to which the Company repurchases any of its shares, the number of shares and the timing of any repurchases will depend on general market conditions, regulatory requirements, alternative investment opportunities and other considerations. The Company is not required to repurchase a minimum number of shares, and the repurchase authorizations may be modified, suspended or terminated at any time without prior notice.

5.Under our various employee benefit plans, we may, at our discretion, issue authorized and unissued shares, or previously issued shares held in treasury, of our common stock or Class A common stock. As of March 31, 2018, we had reserved 7,104,769 shares and 1,703,064 shares of our common stock and Class A common stock, respectively, for future issuance under various employee benefit plans.

6. 7. Stock-based Compensation

We recognize compensation expense for ~~stock-based~~share-based payment awards made to our employees, consultants and ~~directors, including stock options~~directors. Our current stock-based compensation plans include our 2017 Equity and ~~restricted shares under~~Incentive Compensation Plan (the “2017 EICP”); our 2007 ~~Long Term~~ Long-Term Incentive Plan, as amended (the ~~“2007~~“2007 Incentive Plan”); and our Directors’ Restricted Stock ~~Plan. During the three-months ended March 31, 2017 and 2016 our stock-based compensation expense included only expenses associated with our 2007 Long Term Incentive~~ Plan. The following table provides our stock-based compensation expense and related income tax benefit for the ~~three-month periods~~three-months ended March 31, ~~2017~~ 2018 and ~~2016~~2017, respectively (in thousands).

	Three Months Ended March 31,						Three Months Ended March 31,
	2017			2016			2018			2017
Stock-based compensation expense, gross	$	1,337		$	1,284		$	2,157		$	1,337
Income tax benefit at our statutory rate associatedwith stock-based compensation		(521	)		(501	)
Income tax benefit at our statutory rate associated with stock-based compensation								(548	)		(521	)
Stock-based compensation expense, net	$	816		$	783		$	1,609		$	816

~~2007~~~~Long~~T~~erm Incentive Plan~~

~~The 2007 Incentive Plan provides for the grant of incentive stock options, nonqualified stock options, restricted stock awards, stock appreciation rights, and performance awards to acquire~~All shares of ~~our~~common stock and Class A common stock ~~or common~~underlying outstanding options, restricted stock orunits and performance awards are counted as issued at target levels under the ~~receipt~~2017 EICP, the 2007 Incentive Plan and the Directors’ Restricted Stock Plan for purposes of ~~other awards based on our performance, to our employees and non-employee directors.~~determining the number of shares available for future issuance.

During the ~~three-month period~~three-months ended March 31, ~~2017,~~ 2018, we ~~granted:~~granted under the 2017 EICP:

●

110,040 shares of restricted Class A common stock with a grant date fair value per share of $12.65 to an employee, of which 36,680 shares will vest on each of February 28, 2019, 2020 and 2021;

●

110,040 shares of restricted Class A common stock with a grant date fair value per share of $12.65 to an employee, subject to the achievement of certain performance measures, which will vest on February 28, 2021; and

●

318,196 shares of restricted common stock with a grant date fair value per share of $15.25 to certain employees, of which 153,406 shares will vest on February 28, 2019, 82,394 shares will vest on February 28, 2020, and 82,396 shares will vest on February 28, 2021.

During the three-months ended March 31, 2017, we granted under the 2007 Incentive Plan:

●

307,943 shares of restricted common stock to certain employees, of which 102,648 shares vested on January 31, 2018; 102,648 shares will vest on ~~each of~~ January 31, ~~2018~~ 2019; and ~~2019; and~~ 102,647 shares will vest on January 31, ~~2020.~~2020; and

●

198,220 shares of restricted Class A common stock to an employee, of which 66,073 shares vested on January 31, 2018 and 66,073 shares will vest on ~~each of~~ January 31, ~~2018~~ 2019; and ~~2019 and~~ 66,074 shares will vest on January 31, 2020.

~~During the three-month period ended March 31, 2016, we granted:~~

●

218,452 shares of restricted common stock to certain employees, of which 72,816 shares vested on January 31, 2017; 72,816 shares will vest on January 31, 2018; and 72,820 shares will vest on January 31, 2019.

●

~~166,677 shares of restricted Class A common stock to an employee, of which 55,559 shares vested on January 31, 2017 and 55,559 shares will vest on each of January 31, 2018 and 2019.~~

●

~~19,048 shares of restricted common stock and 51,935 shares of restricted Class A common stock to certain non-employee directors, all of which vested on January 31, 2017.~~

A summary of restricted common stock and Class A common stock activities for the ~~three-month periods~~three-months ended March 31, ~~2017~~ 2018 and ~~2016~~2017, respectively, is as follows:

	Three Months Ended										Three Months Ended
	March 31, 2017					March 31, 2016					March 31, 2018					March 31, 2017
				Weighted-					Weighted-					Weighted-					Weighted-
				Average					Average					Average					Average
	Number			Grant Date		Number			Grant Date		Number			Grant Date		Number			Grant Date
	of			Fair Value		of			Fair Value		of			Fair Value		of			Fair Value
	Shares			Per Share		Shares			Per Share		Shares			Per Share		Shares			Per Share
Restricted common stock:
Outstanding - beginning of period		396,033		$	12.06		337,506		$	9.57		503,685		$	11.14		396,033		$	12.06
Granted		307,943		$	10.40		237,500		$	12.88		318,196		$	15.25		307,943		$	10.40
Vested		(200,291	)	$	11.82		(178,973	)	$	8.46		(225,570	)	$	11.21		(200,291	)	$	11.82
Outstanding - end of period		503,685		$	11.14		396,033		$	12.06		596,311		$	13.31		503,685		$	11.14

Restricted Class A common stock:
Outstanding - beginning of period		415,082		$	10.15		374,693		$	9.46		462,632		$	10.63		415,082		$	10.15
Granted(1)		198,220		$	10.60		218,612		$	11.25		220,080		$	12.65		198,220		$	10.60
Vested		(227,526	)	$	10.00		(178,223	)	$	10.04		(274,926	)	$	10.48		(227,526	)	$	10.00
Outstanding - end of period		385,776		$	10.47		415,082		$	10.15		407,786		$	11.82		385,776		$	10.47

Restricted stock units - common stock:
Outstanding - beginning of period												209,500		$	15.70
Granted												-		$	-
Vested												(209,500	)	$	15.70
Forfeited												-		$	-
Outstanding - end of period												-		$	-

(1) For awards subject to future performance conditions, amounts assume target performance.

At March 31, ~~2017~~ 2018 and December 31, ~~2016,~~ 2017, we had 274,746 options to acquire our common stock outstanding, all of which were vested and exercisable. The exercise price of all outstanding stock options is ~~$1.99~~$1.99 per share. As of March 31, ~~2017~~ 2018 and December 31, ~~2016,~~ 2017, we did not have any options outstanding for our Class A common stock. The aggregate intrinsic value of our outstanding stock options was ~~$3.4~~$2.9 million based on the closing market price of our common stock on March 31, ~~2017.~~2018.

11. Subsequent Event

10. ~~Subsequent Events~~

~~Subsequent~~~~Acquisitions~~

On May 13, 2016, we entered into an agreement with Withers Broadcasting Company of West Virginia to acquire WDTV-TV (CBS) and WVFX-TV (FOX/CW) in the Clarksburg-Weston, West Virginia television market (DMA 169) (the “Clarksburg Acquisition”) for a total purchase price of $26.5 million. On June 1, 2016, we began operating the stations, subject to the ultimate control of the seller, under an LMA. Also, on May 31, 2016, we made a partial payment of $16.5 million of the acquisition price and acquired certain non-license assets of these stations. On May 1, 2017, we completed the acquisition of the remaining assets of the stations and paid the remaining $10.0 million of the total purchase price to the seller.

On February 15, 2017, we entered into an agreement with Community Broadcasting Service and Diversified Broadcasting, Inc. to acquire WABI –TV (CBS/CW) in the Bangor, Maine market (DMA 156) and WCJB-TV (ABC/CW) in the Gainesville, Florida market (DMA 161) (collectively, the “Diversified Acquisition”) for a total purchase price of $85.0 million. On April 1, 2017, we commenced operating these stations, subject to the ultimate control of the sellers, pending completion of the acquisitions. We advanced $68.0 million of the purchase price to the sellers on April 3, 2017. On May 1, 2017, we completed the Diversified Acquisition and paid the remaining amount due to the sellers.

The preliminary fair value estimates of the assets acquired, liabilities assumed and resulting goodwill of these acquisitions that we anticipate recording in our condensed consolidated financial statements are summarized as follows (in thousands):

Acquisition

Clarksburg

Diversified

Total

Property and equipment
$ 3,000 $ 13,500 $ 16,500
Goodwill
3,000 30,000 33,000
Broadcast licenses
20,000 27,500 47,500
Other intangible assets
500 14,000 14,500

Total
$ 26,500 $ 85,000 $ 111,500

Amounts in the table above are based upon management’s preliminary estimates of the fair values using valuation techniques including income, cost and market approaches. The fair value estimates are based on, but not limited to, expected future revenue and cash flows, expected future growth rates, and estimated discount rates.

~~Property and equipment are being depreciated over their estimated useful lives ranging from three years to 40 years.~~

Amounts related to other intangible assets represent primarily the estimated fair values of retransmission agreements and favorable income leases. These intangible assets will be amortized over their estimated useful lives.

Goodwill is calculated as the excess of the consideration transferred over the fair value of the identifiable net assets acquired and liabilities assumed, and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce, as well as future synergies that we expect to generate from each acquisition. We have preliminarily determined that $33.0million of goodwill will be recorded. The use of different estimates or assumptions could result in materially different allocations. The goodwill recognized related to these acquisitions is expected to be deductible for income tax purposes.

~~Incremental Term Loan Under 2017 Senior Credit Facility~~

On April 3, 2017, we borrowed $85.0 million under the 2017 Incremental Term Loan under the 2017 Senior Credit Facility. The majority of these additional funds were used to fund the Diversified Acquisition. The interest rates and maturity applicable to the 2017 Incremental Term Loan are the same as the 2017 Initial Term Loan. As a result of our entering into the 2017 Incremental Term Loan, our combined quarterly principal payments will increase to $1.6 million beginning on June 30, 2017. We incurred approximately $0.4 million in deferred financing costs that will be amortized on a straight-line basis over the life of the loan.

~~Results of FCC Spectrum Auction~~

~~On February 6, 2017, we announced that we anticipate receiving $90.8 million in proceeds from the FCC’s recently completed reverse auction for broadcast spectrum.~~

The anticipated proceeds reflect the FCC’s acceptance of one or more bids placed by us during the auction to modify and/or surrender spectrum used by certain of our television stations. We do not expect any material change in operations for us or for any individual market in which we operate.

We anticipate that the auction proceeds will be received in the second or third quarter of 2017. Due to prior planning in connection with our recently completed acquisitions, we anticipate that we will be able to defer any related income tax payments on a long-term basis.

Pending Acquisition

On May ~~4, 2017,~~ 1, 2018, we ~~announced that we have~~ entered into an agreement to acquire ~~WCAX-TV (CBS)~~KDLT-TV (NBC), a television station serving the Sioux Falls, South Dakota market (DMA 110), for $32.5 million. The transaction is subject to regulatory approvals and other customary closing conditions. We expect that this transaction will close in the Burlington, Vermont – Plattsburgh, New York television market (DMA 97) from Mt. Mansfield Television, Inc., for $29.0 million in cash. Subject to regulatory and other approvals, we expect to complete this acquisition later in thesecond or third quarter of ~~2017 primarily through the use of~~2018, using cash on ~~hand and, if necessary, borrowings under our 2017 Senior Credit Facility.~~hand.

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

The following discussion and analysis of the financial condition and results of operations of Gray Television, Inc. and its consolidated subsidiaries (except as the context otherwise provides, “Gray,” the “Company,” “we,” “us” or ~~“our,”~~“our”) isshould be read in conjunction with our unaudited condensed consolidated financial statements and notes thereto included elsewhere herein, as well as with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017 (the “2017 Form 10-K”) filed with the SEC.

In addition to a primary broadcast channel, each of our stations can also broadcast additional secondary digital channels within a market by utilizing the same bandwidth, but with different programming from the primary channel. In addition to affiliations with ABC, CBS and FOX, our secondary channels are affiliated with numerous smaller networks and program services including, among others, the ~~CBS Network (“CBS”)~~CW, MY, MeTV, This TV, Ant., ~~the NBC Network (“NBC”), the ABC Network (“ABC”)~~Telemundo, Cozi, Heroes and ~~the FOX Network (“FOX”). As~~Icons and MOVIES! Networks. Certain of ~~March 31, 2017,~~ our secondary digital channels are affiliated with more than one network simultaneously. We also broadcast local news/weather channels in some markets. Our combined TV station group ~~reached~~reaches approximately ~~10.1%~~10.4% of total United States television households.

~~The following analysis~~Based on the consolidated results of the ~~financial condition~~four Nielsen “sweeps” periods in 2017, our television stations achieved the #1 ranking in overall audience in 42 of our 57 markets and ~~results~~the #1 ranking in local news audience in 38 of ~~operations~~ our markets. In addition, our stations achieved the #1 or #2 ranking in both overall audience and news audience in all 57of ~~Gray Television, Inc.~~our 57 markets.

Over the last several years, the television broadcasting industry has been characterized by a high level of acquisition activity. We continue to believe that there are a number of television stations, and ~~its consolidated subsidiaries should be read~~a few station groups, that have attractive operating profiles and characteristics, and that share our commitment to local news coverage in ~~conjunction with our unaudited condensed consolidated financial statements~~the communities in which they operate and ~~related notes contained in this report~~to creating high-quality and ~~our audited consolidated financial statements and related notes contained in our Annual Report on Form 10-K~~locally-driven content. On a highly selective basis, we may pursue opportunities for the ~~fiscal year ended~~acquisition of additional television stations or station groups that fit our strategic and operational objectives, and where we believe that we can improve revenue, efficiencies and cash flow through active management and cost controls. As we consider potential acquisitions, we primarily evaluate potential station audience and revenue shares and the extent to which the acquisition target would positively impact our existing station operations. Consistent with this strategy, from October 31, 2013 through December 31, ~~2016 (the “2016 Form 10-K”).~~

~~On January 13,~~ 2017, we ~~acquired KTVF-TV (NBC), KXDF-TV (CBS),~~completed 23 acquisition transactions and ~~KFXF-TV (FOX)~~three divestiture transactions. These transactions added a net total of 51 television stations in ~~the Fairbanks, Alaska~~31 television ~~market for $8.0 million (the “Fairbanks Acquisition”).~~

~~On January 17, 2017, we acquired WBAY-TV (ABC), in the Green Bay, Wisconsin~~markets, including 26 new television market, and KWQC-TV (NBC), in the Davenport, Iowa, Rock Island, Illinois, and Moline, Illinois or “Quad Cities” television market (collectively, the “Media General Acquisition”), for an adjusted purchase price of $269.9 million.

~~We refer~~markets, to ~~the five~~our operations including eight stations acquired ~~through March 31,~~in 2017 ~~as the “2017 Acquisitions.” We refer to the 13~~(excluding certain television stations ~~acquired and retained~~we began operating in 2016, ~~including the two stations~~and subsequently acquired in 2017, in the Clarksburg, West Virginia market, ~~that we commenced operating under a local programming and marketing agreement (“LMA”) in June 2016 as~~ the ~~“2016 Acquisitions.”~~“2017 Acquisitions”).

~~On May 13, 2016, we entered into an agreement with Withers Broadcasting Company~~Our operating revenues are derived primarily from broadcast and internet advertising and retransmission consent fees and, to a lesser extent, from other sources such as production of ~~West Virginia to acquire WDTV-TV (CBS)~~commercials, tower rentals and WVFX-TV (FOX/CW) in the Clarksburg-Weston, West Virginia television market (DMA 169) (the “Clarksburg Acquisition”) for a total purchase price of $26.5 million. On June 1, 2016, we began operating the stations, subject to the control of the seller, under an LMA. Also, on May 31, 2016, we pre-paid $16.5 million of the acquisition price and acquired certain non-license assets of these stations. On May 1, 2017, we completed the acquisition of the remaining assets of the stations and paid the remaining amount due to the sellers.

On February 15, 2017, we entered into an agreement with Community Broadcasting Service and Diversified Broadcasting, Inc. to acquire WABI-TV (CBS/CW) in the Bangor, Maine television market (DMA 156) and WCJB-TV (ABC/CW) in the Gainesville, Florida television market (DMA 161) (collectively, the “Diversified Acquisition”) for a total purchase price of $85.0 million. On March 27, 2017, we amended this agreement in order to enter into an LMA to operate each station, subject to the control of the seller, until we completed the acquisitions. The LMA for each station was effective on April 1, 2017. We pre-paid $68.0 million of the purchase price to the sellers on April 3, 2017. On May 1, 2017, we completed the Diversified Acquisition and paid the remaining amount due to the sellers.management fees.

On May 4, 2017, we announced that we have entered into an agreement to acquire WCAX-TV (CBS) in the Burlington, Vermont – Plattsburgh, New York television market (DMA 97) from Mt. Mansfield Television, Inc., for $29.0 million in cash. Subject to regulatory and other approvals, we expect to complete this acquisition later in the third quarter of 2017 primarily through the use of cash on hand at closing and, if necessary, borrowings under our 2017 Senior Credit Facility.

~~For additional information regarding our recent acquisitions, see Note 2 “Acquisitions” and Note 10 “Subsequent Events.”~~

On February 7, 2017, we entered into the 2017 Senior Credit Facility. As of March 31, 2017, the 2017 Senior Credit Facility provided total commitments of $655.0 million, consisting of a$555.0 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 term loan.

On 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 a result of our entering into the 2017 Incremental Term Loan our combined quarterly principal payments will increase to $1.6 million beginning on June 30, 2017.

Broadcast stations like ours rely on advertising revenue, and, as a result, they are sensitive to cyclical changes in the economy. Our political advertising revenue is generally not as significantly affected by economic slowdowns or recessions as our non-political advertising revenue.

Broadcast advertising ~~revenue~~ is ~~generally highest~~sold for placement either preceding or following a television station’s network programming and within local and syndicated programming. Broadcast advertising is sold in time increments and is priced primarily on the basis of a program’s popularity among the specific audience an advertiser desires to reach, as measured by Nielsen. In addition, broadcast advertising rates are affected by the number of advertisers competing for the available time, the size and demographic makeup of the market served by the station and the availability of alternative advertising media in the second and fourth quarters each year. This seasonality results partly from increases in consumer advertising in the spring and retail advertising in the period leading up to and including the Christmas holiday season.market area. Broadcast advertising ~~revenue is also typically higher in even-numbered years due to spending by political candidates, political parties and special interest groups~~rates are generally the highest during the ~~“on year”~~most desirable viewing hours, with corresponding reductions during other hours. The ratings of ~~the two-year political~~a local station affiliated with a major network can be affected by ratings of network programming. Most advertising ~~cycle. This political advertising spending typically is heaviest during the fourth quarter. In addition, the broadcast of Olympic Games by our NBC-affiliated stations during even-numbered years~~contracts are short-term, and generally ~~leads to increased viewership and revenue during those years.~~run only for a few weeks.

We also sell internet advertising on our stations’ websites. These advertisements may be sold as banner advertisements, pre-roll advertisements or video and other types of advertisements or sponsorships.

Our broadcast and internet advertising revenues are affected by several factors that we consider to be seasonal in nature. These factors include:

Automotive advertisers have traditionally accounted for a significant portion of our revenue. For the ~~three-month period~~three months ended March 31, 2018 and 2017, ~~excluding political advertising revenue, our largest advertising customer category was automotive. For each of the three-month periods ended March 31, 2017~~we derived approximately 24% and ~~2016, we earned approximately~~ 25% ~~and 23%~~, respectively, of our total broadcast advertising revenue ~~excluding~~from customers in the automotive industry. Strong demand for our advertising inventory from political advertisers can require significant use of available inventory, which in turn can lower our advertising revenue from ~~automotive customers. Our business and operating results could be materially adversely affected if~~our non-political advertising revenue categories in the even numbered “on-year” of the two year election cycle. These temporary declines are expected to reverse themselves in the following “off-year” of the two year election cycle.

While our total revenues have increased in recent years as a result of our acquisitions, they have also experienced a gradual improvement as a result of improvements in general economic conditions. However, revenue remains under pressure from ~~automotive customers were~~the internet as a competitor for advertising spending. We continue to ~~decrease significantly.~~enhance and market our internet websites in an effort to generate additional revenue. Our ~~business~~aggregate internet revenue is derived from both advertising and sponsorship opportunities directly on our websites.

Our primary broadcasting operating ~~results could also be materially adversely affected if revenue decreased from one or more other significant advertising categories,~~expenses are employee compensation, related benefits and programming costs. In addition, the broadcasting operations incur overhead expenses, such as maintenance, supplies, insurance, rent and utilities. A large portion of the ~~medical, restaurant, communications, furniture~~operating expenses of our broadcasting operations is fixed. We continue to monitor our operating expenses and ~~appliances, entertainment, or financial service industries.~~seek opportunities to reduce them where possible.

Please see our “Results of Operations” and “Liquidity and Capital Resources” sections below for further discussion of our operating results.

Set forth below are the principal types of revenue, less agency commissions, earned by us for the periods indicated and the percentage contribution of each type of revenue to our total revenue (dollars in thousands):

~~Three-Months~~Three-Months EndedMarch 31, 2018(“the 2018 three-month period”)Compared to Three-Months Ended March 31, 2017 ~~Compared to Three-Months Ended~~~~March 31, 2016~~(“the 2017 three-month period”)

Revenue. Total revenue increased ~~$29.7~~$22.8 million, or ~~17%~~11%, to ~~$203.5~~$226.3 million in the ~~2017~~2018 three-month period. ~~Revenue from the~~We acquired three television stations between April 1, 2017 ~~Acquisitions~~ and ~~2016 Acquisitions~~March 31, 2018. Collectively, these three television stations accounted for approximately ~~$47.5~~$9.6 million of the increase in our total revenue in the ~~2017~~2018 three-month period. ~~The 2016 Acquisitions accounted for approximately $16.6 million of our~~Including the impact attributable to these three stations, total revenue ~~in the 2016 three-month period. In addition to the impact of the 2017 Acquisitions and the 2016 Acquisitions, total revenue for our legacy stations~~ increased primarily due to retransmission consent revenue that increased ~~by $9.2~~$18.0 million. Political advertising revenue ~~at our legacy stations decreased by $8.3~~increased $4.5 million in the first quarter of ~~2017,~~2018, resulting primarily from ~~2017~~2018 being the ~~“off-year”~~“on-year” of the two-year election cycle. Local ~~and national~~ revenue ~~at our legacy stations decreased,~~increased $2.9 million, in part, as a result of revenue from the broadcast of the 2018 Super Bowl on our NBC-affiliated stations of approximately $2.3 million, compared to $0.6 million that we earned from the broadcast of the 2017 Super Bowl on our FOX-affiliated ~~stations, which generated local and national advertising~~stations. In addition, 2018 total revenue ~~of approximately $0.6 million, compared to $1.6 million that we earned~~ from the broadcast of the ~~2016 Super Bowl~~Winter Olympic Games on our ~~CBS-affiliated stations. Our portfolio of CBS-affiliated~~NBC-affiliated stations ~~is significantly larger compared to our portfolio of FOX-affiliated stations.~~was approximately $5.5 million.

Our five largest local and national advertising categories on a combined local and national basis by customer type, excluding political advertising, demonstrated the following changes during the 2017 three-month period compared to the 2016 three-month period: automotive decreased 2%; medical decreased 4%; furniture and appliances decreased 5%; restaurant decreased 10%; and communications increased 2%.

Broadcast ~~Expenses~~ Expenses. Broadcast expenses (before depreciation, amortization and gain or loss on disposal of assets) increased ~~$24.9~~$16.1 million, or ~~23%~~12%, to ~~$133.5~~$149.7 million in the 2018 three-month period. The three television stations that we acquired between April 1, 2017 ~~three-month period due primarily to the 2017 Acquisitions~~ and ~~2016 Acquisitions, which~~March 31, 2018 collectively accounted for approximately ~~$30.3~~$6.6 million of the increase in broadcast ~~expense in the 2017 three-month period. The 2016 Acquisitions accounted for approximately $10.8 million of our broadcast expenses in the 2016 three-month period. In addition to~~operating expenses. Including the impact ~~of the 2017 Acquisitions and the 2016 Acquisitions,~~attributable to these three stations, non-compensation expense ~~at our legacy stations~~ increased ~~$4.5~~$13.1 million primarily as a result of a ~~$5.1~~$9.4 million increase in retransmission expense, consistent with the increased retransmission consent revenue.~~In addition to the impact of the 2017 Acquisitions and 2016 Acquisitions, compensation~~ Compensation expense ~~at our legacy stations~~ increased ~~$0.9 million due to increases in incentive compensation.Non-cash~~$2.9 million. Non-cash stock based compensation expenses were $1.2 million in the 2018 three-month period and $0.3 ~~millionin each~~million in the 2017 three-month period.

Corporate and Administrative Expenses. Corporate and administrative expenses (before depreciation, amortization and gain or loss on disposal of assets) ~~decreased $8.0~~increased $0.6 million, or ~~51%~~7%, to ~~$7.7~~$8.3 million, due primarily to ~~decreases~~increases of ~~$7.3~~$0.3 million in professional fees ~~related to our acquisitions. Compensation~~and compensation expense ~~decreased $0.4~~increases of $0.3 million during the ~~2017~~2018 three-month ~~period due to decreased incentive compensation costs.~~period. We recorded corporate non-cash stock-based compensation expense of $0.9 million in the 2018 three-month period compared to $1.0 million in ~~each~~the 2017 three-month period.

Depreciation. Depreciation of property and equipment totaled ~~$12.6~~$13.7 million and ~~$11.1~~$12.6 million for the ~~2017~~2018 three-month period and the ~~2016~~2017 three-month period, respectively. Depreciation increased primarily due to the addition of depreciable assets acquired in connection with the 2017 ~~Acquisitions and the 2016~~ Acquisitions.

Amortization. Amortization of intangible assets totaled ~~$5.6~~$5.4 million and ~~$3.9~~$5.6 million for the ~~2017~~2018 three-month period and the ~~2016~~2017 three-month period, respectively. Amortization expense ~~increased~~decreased primarily due to the ~~addition of~~ finite-lived intangible assets acquired in connection with the 2017 Acquisitions ~~and the 2016 Acquisitions.~~now being fully amortized.

Interest ~~Expense~~Expense. Interest expense increased ~~$1.9~~$1.1 million ~~or 9%,~~ to ~~$23.2~~$24.3 million for the ~~2017~~2018 three-month period compared to the ~~2016~~2017 three-month period. This increase was attributable to an increase in the average ~~borrowings outstanding but partially offset by a decrease in our average~~ interest rates. The average interest ~~rate~~rates on our total outstanding debt balance ~~was~~were 5.0% and 4.9% ~~and 5.6%~~ during the ~~2017~~2018 three-month period and the ~~2016~~2017 three-month period, respectively. Our average outstanding debt balance was $1.8 billion ~~and $1.5 billion~~ during the 2018 and 2017 three-month ~~period and the 2016 three-month period, respectively, with the increase primarily attributable to the borrowings to finance the 2017 Acquisitions and 2016 Acquisitions.~~periods.

Lossfrom Early Extinguishment of ~~Debt~~.Debt. In the first quarter of 2017, we recorded a loss from early extinguishment of debt of approximately $2.5 million, related to the amendment and restatement of our senior credit facility.

Income tax expense. We recognized income tax expense of ~~$7.3~~$6.4 million and ~~$6.4~~$7.3 million in the ~~2017~~2018 three-month period and the ~~2016~~2017 three-month period, respectively. For the ~~2017~~2018 three-month period and the ~~2016~~2017 three-month period, our effective income tax rate was ~~41.1%~~24.3% and ~~41.6%~~41.1%, respectively. We estimate our differences between taxable income or loss and recorded income or loss on an annual basis. Our tax provision for each quarter is based upon these full year projections which are revised each reporting period. These projections incorporate estimates of permanent differences between U.S. GAAP income or loss and taxable income or loss, state income taxes and adjustments to our liability for unrecognized tax benefits. For the ~~2017~~2018 three-month period, these estimates increased or decreased our statutory Federal income tax rate of ~~35.0%~~21.0% to our effective income tax rate of ~~41.1%~~24.3% as follows: state income taxes added ~~4.4%~~4.7%, permanent differences between our U.S. GAAP income and taxable income added ~~1.9%~~0.8%, and a discrete adjustment resulted in a reduction of ~~0.2%~~2.2%.

The following table presents data that we believe is helpful in evaluating our liquidity and capital resources (in thousands).

Our 2017 Senior Credit Facility consists of the 2017 Revolving Credit Facility and the 2017 Term Loan. Excluding accrued interest, the amount outstanding under our 2017 Senior Credit Facility and the 2014 Senior Credit Facility as of March 31, 2017 and December 31, 2016 consisted solely of a term loan totaling $555.0 million and$556.4 million, respectively. On April 3, 2017, we borrowed $85.0 million under the 2017 Incremental Term Loan. Our maximum borrowing availability under our 2017 Revolving Credit Facility is limited by our required compliance with certain restrictive covenants, including a first lien net leverage ratio covenant.

As of March 31, 2017, the interest rate on the balance outstanding under the 2017 Senior Credit Facility was 3.3%. As of December 31, 2016, the interest rate on the balance outstanding under the 2014 Senior Credit Facility was 3.9%.

2017 Term Loan borrowings bear interest, at our option, of either LIBOR plus an applicable margin or the Base Rate (as defined below) plus an applicable margin. Until our results of operations for the quarter ending September 30, 2017 have been certified, the applicable margin will be 2.50% for all LIBOR borrowings and 1.50% for all Base Rate borrowings (the “Initial Applicable Margin”). Thereafter, (i) if the leverage ratio as set forth in the 2017 Senior Credit Facility (the “Leverage Ratio”) is less than or equal to 5.25 to 1.00, the applicable margin will be 2.25% for all LIBOR borrowings and 1.25% for all Base Rate borrowings and (ii) if the Leverage Ratio is greater than 5.25 to 1.00, the Initial Applicable Margin will apply.

Borrowings under the 2017 Revolving Credit Facility bear interest, at our option, based on LIBOR plus 1.50% to 2.00% or the Base Rate plus 0.50% to 1.00%, 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% to 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 ofthe amendment and restatement of our prior senior credit facility in the form of the 2017 Senior Credit Facility, on February 7, 2017, we recorded a loss from early extinguishment of debt of approximately $2.5 million in the first quarter of 2017, and we incurred approximately $4.6 million in deferred financing costs that will be amortized over the life of the 2017 Senior Credit Facility.

As a result of entering into the 2017 Incremental Term Loan, our combined quarterly principal payments will increase to $1.6 million beginning on June 30, 2017, and we incurred approximately $0.4 million in deferred financing costs that will be amortized on a straight line basis over the life of the loan.

Our obligations under the 2017 Senior Credit Facility are secured by substantially all of our and our consolidated subsidiaries' 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. GME is not a guarantor of, and its assets are not pledged to secure our obligations under, the 2017 Senior Credit Facility. Gray Television, Inc. is a holding company with no 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 all of Gray Television, Inc.'s subsidiaries. GME is not a guarantor of the 2024 Notes or the 2026 Notes. As of March 31, 2017, there were no significant restrictions on the ability of Gray Television, Inc.'s subsidiaries to distribute cash to Gray.

The 2017 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 a first lien leverage ratio not to exceed certain maximum limits 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 March 31, 2017 and December 31, 2016, we were in compliance with all required covenants under all our debt obligations.

Net CashProvided By (Used In) ~~Provided By~~Operating, Investing and Financing Activities

Net cash provided by operating activities was $14.4 million in the 2018 three-month period compared to net cash used in operating activities ~~was~~of $0.5 million in the 2017 three-month ~~period compared to net cash provided by operating activities~~period. The increase of ~~$29.7~~$14.9 million in the ~~2016 three-month period. The decrease of $30.2 million in the 2017~~2018 three-month period was primarily the result of an increase in net income of ~~$1.5~~$9.4 million ~~and an increase~~that was partially offset by a $3.4 million net decrease in non-cash expenses, primarily ~~depreciation, amortization of intangible assets and~~ deferred taxes and loss on extinguishment of ~~$9.0~~debt. Approximately $8.9 million ~~offset by an increase in current assets and a decrease in current liabilities resulting in a use~~ of cash was provided by changes in net working ~~capital accounts of $40.7 million.~~capital. These changes are primarily due to the impact of the 2017 ~~Acquisitions and the 2016~~ Acquisitions.

Net cash used in investing activities was ~~$293.4~~$7.8 million in the ~~2017~~2018 three-month period compared to net cash used in investing activities of ~~$420.2~~$293.4 million for the ~~2016~~2017 three-month period. The decrease was largely due to a decrease in cash used for acquisition activity in the ~~2017~~2018 three-month period.

Net cash used in financing activities was approximately ~~$7.8~~$25.6 million in the ~~2017~~2018 three-month period compared to net cash ~~provided by~~used in financing activities of ~~$413.8~~$7.8 million in the ~~2016~~2017 three-month period. Cash used in financing activities in the ~~2017~~2018 three-month period was primarily due to the ~~$1.4~~$1.6 million of ~~repayments of the 2017 Term Loan, $4.6 million of deferred financing costs related to entering into the~~principal payments on our 2017 Senior Credit Facility, $19.6 million used to repurchase approximately 1.6 million shares of our common stock and ~~$1.8~~$4.4 million of payments for taxes related to net share settlements of equity awards. We funded the 2017 Acquisitions through borrowings in the third quarter of 2016. The net cash provided by financing activities in the 2016 three-month period was used to fund a portion of our 2016 Acquisitions.

We have $6.4 million in debt principal payments due over the next twelve months. We estimate that we will make approximately ~~$90.4~~$93.3 million in debt interest payments over the twelve months immediately following March 31, ~~2017.~~2018.

Although our cash flows from operations are subject to a number of risks and uncertainties, we anticipate that our cash on hand, future cash expected to be generated from operations, borrowings from time to time under the 2017 Senior Credit Facility (or any such other credit facility as may be in place at the appropriate time) and, potentially, external equity or debt financing, will be sufficient to fund any debt service obligations, estimated capital expenditures and acquisition-related obligations. Any potential equity or debt financing would depend upon, among other things, the costs and availability of such financing at the appropriate time. We also ~~presently~~ believe that our future cash expected to be generated from operations and borrowing availability under the 2017 Senior Credit Facility (or any such other credit facility) will be sufficient to fund our future capital expenditures and long-term debt service obligations until at least February 7, 2024, which is the maturity date of the term loans under the 2017 Senior Credit Facility.

Capital expenditures in the ~~2017~~2018 and ~~2016~~2017 three-month periods were ~~$4.0~~$6.3 million and ~~$5.9~~$4.0 million, respectively. We anticipate that our capital expenditures for the remainder of ~~2017~~2018 will range between approximately ~~$26.0~~$50.0 million and ~~$31.0~~$53.0 million. In addition, capital expenditures for Repack during the remainder of 2018 are expected to range between approximately $49.0 million and $50.0 million.

~~Results~~The legislation authorizing the Repack provides the FCC with a $1.7 billion fund to reimburse reasonable costs incurred by stations operating under a full power license that are reassigned to new channels. Twenty-six of ~~FCC Spectrum Auction~~

~~On February 6, 2017,~~our current full power stations and five of our low power stations are affected by the Repack. We expect to receive reimbursements for the majority of our expenses related to the Repack of our full power stations. However, we ~~announced that we anticipate receiving $ 90.8 million in proceeds from~~cannot predict whether the ~~FCC’s recently completed reverse auction for broadcast spectrum.~~fund will be sufficient to reimburse all of our expenses.

The ~~anticipated proceeds reflect~~sufficiency of the FCC’s ~~acceptance~~fund to reimburse for Repack costs is dependent upon a number of ~~one or more bids placed by us during~~factors including the ~~auction~~amounts to ~~modify and/or surrender spectrum used by certain~~be reimbursed to other industry participants for repacking costs. Currently, we estimate that our total reimbursable cost for the Repack of our ~~television~~full power stations will be approximately $81.4 million. In addition to the reimbursable costs, we intend to make other changes and improvements to our broadcast equipment and facilities that would not have been economically feasible if we were not also purchasing equipment for the Repack. We refer to these related but non-reimbursable capital expenditures as “Repack Related.” Currently, we estimate that Repack Related capital expenditures will be approximately $26.7 million. We are currently developing our estimate of non-reimbursable Repack Related capital expenditures for our low power stations. ~~We do not expect any material change~~The Repack process began in ~~operations for us or for any individual market in which we operate.~~

the summer of 2017 and will take approximately three years to complete. We anticipate that the ~~auction proceeds~~majority of our costs associated with Repack will ~~be received~~qualify for capitalization, rather than expense. During the year ended December 31, 2017, our capitalized Repack costs and associated reimbursements were $2.8 million and $0.1 million, respectively. As of March 31, 2018, the amount receivable from the FCC for Repack was approximately $4.2 million.

On May 1, 2018, we entered into an agreement to acquire KDLT-TV (NBC), a television station serving the Sioux Falls, South Dakota market (DMA 110) for $32.5 million. The transaction is subject to regulatory approvals and other customary closing conditions. We expect that this transaction will close in the second or third quarter of ~~2017. Due to prior planning in connection with our recently completed acquisitions, we anticipate that we will be able to defer any related income tax payments~~2018, using cash on ~~a long-term basis.~~hand.

We file a consolidated federal income tax return and such state and local tax returns as are required. As a result of our utilization of certain of our net operating loss carryforwards, we have begun, and expect to continue, to pay more significant amounts of income taxes. During the ~~2017~~2018 three-month period, we made income tax payments (net of refunds) of ~~$0.3~~$8.5 million. During the remainder of ~~2017,~~2018, we anticipate making income tax payments (net of refunds) of approximately ~~$1.1~~$36.0 million. ~~Income tax payments are likely to be higher beginning in 2018, assuming no significant changes to the corporate tax code as currently in effect.~~

During the ~~three-months ended March 31, 2017,~~2018 three-month period, we ~~contributed $0.6 million~~did not make a contribution to our defined benefit pension plan. During the remainder of ~~2017,~~2018, we expect to contribute ~~$1.7~~$2.0 million to this pension plan.

The preparation of financial statements in conformity with U.S. GAAP requires management to make judgments and estimations that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. We consider our accounting policies relating to intangible assets and income taxes to be critical policies that require judgments or estimations in their application where variances in those judgments or estimations could make a significant difference to future reported results. These critical accounting policies and estimates are more fully discussed in our ~~2016~~2017 Form 10-K.

This Quarterly Report on Form 10-Q (this “Quarterly Report”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are all statements other than those of historical fact. When used in this Quarterly Report, the words “believes,” “expects,” “anticipates,” “estimates,” “will,” “may,” “should” and similar words and expressions are generally intended to identify forward-looking statements. Among other things, statements that describe our expectations regarding our results of operations, general and industry-specific economic conditions, future pension plan contributions, income tax payments and capital expenditures are forward-looking statements. Readers of this Quarterly Report are cautioned that any forward-looking statements, including those regarding the intent, belief or current expectations of our management, are not guarantees of future performance, results or events and involve risks and uncertainties, and that actual results and events may differ materially from those contained in the forward-looking statements as a result of various factors including, but not limited to, those listed under the heading “Risk Factors” in our ~~2016~~2017 Form 10-K and as may be described in subsequently filed quarterly reports on Form 10-Q, as well as the other factors described from time to time in our filings with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made. We undertake no obligation to update such forward-looking statements to reflect subsequent events or circumstances.

We believe that the market risk of our financial instruments as of March 31, ~~2017~~2018 has not materially changed since December 31, ~~2016.~~2017. Our market risk profile on December 31, ~~2016~~2017 is disclosed in our ~~2016~~2017 Form 10-K.

As of the end of the period covered by this Quarterly Report, an evaluation was carried out under the supervision and with the participation of management, including the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), of the effectiveness of our disclosure controls and procedures. Based on that evaluation, the CEO and the CFO have concluded that, as of the end of the period covered by this Quarterly Report, our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or furnish under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and to ensure that such information is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosures. No system of controls, no matter how well designed and implemented, can provide absolute assurance that the objectives of the system of controls are met and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

~~There were no~~During the three-month period ended March 31, 2018, we implemented changes in our internal control over financial reporting ~~during the three-month period ended March 31, 2017 identified~~ in connection with ~~this~~the adoption of ASC 606 - Revenue from Contracts with Customers, as amended. These changes included controls related to the collection of data for the amounts that we disclose in the footnotes to our financial statements. We also implemented changes in our internal control over financial reporting in connection with the adoption of ASU No. 2016-01 – Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities. These changes relate to the implementation of procedures to document our identification and evaluation of factors that may identify potential impairment of the value of certain non-current investments. Our evaluation included controls that may have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Please refer to the information set out under the heading “Risk Factors” in Part I, Item 1A in our ~~2016~~2017 Form 10-K for a description of risk factors that we determined to be most material to our financial condition and results of operations. We do not believe there have been any material changes in these risk factors. Additional risks not currently known to us or that we do not currently consider material may also materially adversely affect our financial condition and results of operations in the future.

In each of March and November 2004, the Board of Directors of the Company authorized the Company to repurchase up to 2.0 million shares of the Company's common stock or Class A common stock. In March 2006, this authorization was increased to an aggregate of 5.0 million shares (the “2004-2006 Repurchase Authorization”). As of March 31, 2018, 279,200 shares remain available for repurchase under this authorization, which has no expiration date.

On November 6, 2016, the Board of Directors of the Company authorized the Company to purchase up to an additional $75.0 million of our outstanding common stock prior to December 31, 2019 (the “2016 Repurchase Authorization”).

The extent to which the Company repurchases any of its shares, the number of shares and the timing of any repurchases will depend on general market conditions, regulatory requirements, alternative investment opportunities and other considerations. The Company is not required to repurchase a minimum number of shares, and the repurchase authorizations may be modified, suspended or terminated at any time without prior notice.

The following table summarizes repurchases of our common stock in the three-months ended March 31, 2018, all of which were pursuant to the 2016 Repurchase Authorization:

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.

Georgia		58-0285030
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

4370 Peachtree Road, NE, Atlanta, Georgia		30319
(Address of principal executive offices)		(Zip code)

	Large accelerated filer ☒		Accelerated filer ☐
	Non-accelerated filer ☐ (do not check if a smaller reporting company)		Smaller reporting company ☐
	Emerging growth company ☐

Common Stock (No Par Value)		Class A Common Stock (No Par Value)
~~66,284,493~~82,039,917 shares outstanding as of May 1 ~~2017~~, 2018		~~6,404,862~~6,729,035 shares outstanding as of May 1 ~~2017~~, 2018


PART I.		FINANCIAL INFORMATION			PAGE

Item 1.		Financial Statements

		Condensed consolidated balance sheets (Unaudited) – March 31, ~~2017~~2018 and December 31, ~~2016~~2017	3		3

		Condensed consolidated statements of operations (Unaudited) ~~–three months~~– three-months ended March 31, ~~2017~~2018 and ~~2016~~2017	5		5

		Condensed consolidated statement of stockholders' ~~equity(Unaudited)~~equity (Unaudited) – ~~three months~~three-months ended March 31, ~~2017~~2018	6		6

		Condensed consolidated statements of cash flows (Unaudited) ~~–three months ended~~– three months-ended March 31, ~~2017~~2018 and ~~2016~~2017	7		7

		Notes to condensed consolidated financial statements (Unaudited)		8


Item 2.		Management's Discussion and Analysis of Financial Condition and Results of Operations	21	22

Item 3.		Quantitative and Qualitative Disclosures About Market Risk	27	29

Item 4.		Controls and Procedures	27	29

PART II.		OTHER INFORMATION

Item 1A.		Risk Factors	27	29

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	27

Item 6.		Exhibits	29	30

SIGNATURES		30

	March 31,		December 31,
	2018		2017
Assets:
Current assets:
Cash	$	443,425	$	462,399
Accounts receivable, less allowance for doubtful accounts of $4,656 and $4,606, respectively		168,186		171,230
Current portion of program broadcast rights, net		9,750		14,656
Prepaid income taxes		22,251		13,791
Prepaid and other current assets		6,001		4,681
Total current assets		649,613		666,757

Property and equipment, net		343,178		350,658
Broadcast licenses		1,530,703		1,530,703
Goodwill		611,100		611,100
Other intangible assets, net		68,348		73,784
Investment in broadcasting and technology companies		16,599		16,599
Other		13,171		11,256
Total assets	$	3,232,712	$	3,260,857

[X]	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the quarterly period ended March 31, 2018or

~~PART I.~~	~~FINANCIAL INFORMATION~~

~~Item 1.~~	~~Financial Statements~~

~~(1)~~GRAY TELEVISION, INC.
~~Our consolidated total assets as of March 31, 2017 included total assets of $149.8million of a variable interest entity (“VIE”). These assets can only be used to settle the obligations of the VIE.~~CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in thousands except for share data)

																								Accumulated
	Class A											Class A						Common						Other
	Common Stock				Common Stock				Accumulated			Treasury Stock						Treasury Stock						Comprehensive
	Shares		Amount		Shares		Amount		Deficit			Shares			Amount			Shares			Amount			Loss			Total

Balance at December 31, 2016		8,073,993	$	21,764		71,229,497	$	658,135	$	(101,365	)		(1,669,131	)	$	(23,340	)		(5,135,406	)	$	(44,688	)	$	(17,645	)	$	492,861

Adoption of ASU 2016-09excess tax benefit forstock-based compensation		-		-		-		-		1,107			-			-			-			-			-			1,107

Net income		-		-		-		-		10,505			-			-			-			-			-			10,505

Issuance of common stock:
401(k) plan		-		-		557		7		-			-			-			-			-			-			7
2007 Long Term IncentivePlan -restricted stock		198,220		-		307,943		-		-			(81,561	)		(892	)		(77,632	)		(874	)		-			(1,766	)

Share-based compensation		-		570		-		767		-			-			-			-			-			-			1,337


Balance at March 31, 2017		8,272,213	$	22,334		71,537,997	$	658,909	$	(89,753	)		(1,750,692	)	$	(24,232	)		(5,213,038	)	$	(45,562	)	$	(17,645	)	$	504,051

GRAY TELEVISION, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(in thousands)

							Estimated
	March 31,			December 31,			Useful Lives
	2017			2016			(in years)
Property and equipment:
Land	$	48,421		$	44,611
Buildings and improvements		145,077			139,078			7	to	40
Equipment		487,667			471,798			3	to	20
		681,165			655,487
Accumulated depreciation		(341,181	)		(329,394	)
Total property and equipment, net	$	339,984		$	326,093

	Acquisition
	Fairbanks			Media General			Total

Current assets	$	122		$	666		$	788
Property and equipment		2,650			20,471			23,121
Goodwill		471			85,919			86,390
Broadcast licenses		2,228			149,846			152,074
Other intangible assets		2,702			13,398			16,100
Other non-current assets		71			282			353
Current liabilities		(140	)		(695	)		(835	)
Other long-term liabilities		(84	)		-			(84	)

Total	$	8,020		$	269,887		$	277,907

	Minimum Principal Maturities
Year	2017 Senior Credit Facility⁽¹⁾		2024 Notes		2026 Notes		Total
2017	$	4,173	$	-	$	-	$	4,173
2018		5,564		-		-		5,564
2019		5,564		-		-		5,564
2020		5,564		-		-		5,564
2021		5,564		-		-		5,564
Thereafter		528,617		525,000		700,000		1,753,617
Total	$	555,046	$	525,000	$	700,000	$	1,780,046

	Net Balance at											Net Balance at
	December 31,											March 31,
	2016		Additions		Dispositions		Impairments		Amortization			2017

Goodwill	$	485,318	$	86,390	$	-	$	-	$	-		$	571,708
Broadcast licenses		1,340,305		152,074		-		-		-			1,492,379
Finite-lived intangibleassets		56,250		20,101		-		-		(5,567	)		70,784
Total intangible assetsnet of accumulatedamortization	$	1,881,873	$	258,565	$	-	$	-	$	(5,567	)	$	2,134,871

	As of March 31, 2017							As of December 31, 2016
			Accumulated							Accumulated
	Gross		Amortization			Net		Gross		Amortization			Net
Intangible assets not currentlysubject to amortization:
Broadcast licenses	$	1,546,078	$	(53,699	)	$	1,492,379	$	1,394,004	$	(53,699	)	$	1,340,305
Goodwill		571,708		-			571,708		485,318		-			485,318
	$	2,117,786	$	(53,699	)	$	2,064,087	$	1,879,322	$	(53,699	)	$	1,825,623

Intangible assets subjectto amortization:
Network affiliationagreements	$	5,264	$	(1,612	)	$	3,652		1,264	$	(1,264	)	$	-
Other finite-livedintangible assets		121,892		(54,760	)		67,132		105,792		(49,542	)		56,250
	$	127,156	$	(56,372	)	$	70,784	$	107,056	$	(50,806	)	$	56,250

Total intangibles	$	2,244,942	$	(110,071	)	$	2,134,871	$	1,986,378	$	(104,505	)	$	1,881,873

	Three Months Ended
	March 31,
	2018		2017
Market and service type:
Advertising:
Local	$	105,469	$	102,597
National		24,512		24,814
Political		5,775		1,321
Total advertising		135,756		128,732
Retransmission consent		85,551		67,573
Other		4,951		7,156
Total revenue	$	226,258	$	203,461

Sales Channel:
Direct	$	133,422	$	114,522
Advertising agency intermediary		92,836		88,939
Total revenue	$	226,258	$	203,461

	Acquisition
	Clarksburg		Diversified		Total

Property and equipment	$	3,000	$	13,500	$	16,500
Goodwill		3,000		30,000		33,000
Broadcast licenses		20,000		27,500		47,500
Other intangible assets		500		14,000		14,500

Total	$	26,500	$	85,000	$	111,500

	As of
	March 31,		December 31,
	2017		2016
Cash	$	23,541	$	325,189
Long-term debt, including current portion	$	1,754,280	$	1,756,747
Borrowing availability under the Revolving Credit Facility	$	100,000	$	60,000

	As of
	March 31,		December 31,
	2018		2017
Cash	$	443,425	$	462,399
Long-term debt, less deferred financing costs	$	1,836,828	$	1,837,428
Borrowing availability under the Revolving Credit Facility	$	100,000	$	100,000

Period	Total Number of Shares Purchased (1)		Average Price Paid per Share (2)		Total Number of Shares Purchased as Part of Publicly Announced Plans		Maximum Number of Shares (or Approximate Dollar Value) that May Yet Be Purchased Under the Plans or Programs (3)

January 1, 2018 through January 31, 2018:		-	$	-		-	$	73,080,585

February 1, 2018 through February 28, 2018		-	$	-		-	$	72,589,193

March 1, 2018 through March 31, 2018		1,551,710	$	12.61		1,551,710	$	53,017,169

Total		1,551,710	$	12.61		1,551,710

Exhibit Number		Description of Document

~~10.1~~3.1		~~Restatement Agreement, dated as~~Restated Articles of ~~February 7, 2017, by and among~~Incorporation of Gray Television, Inc., as ~~Borrower, the guarantors party thereto, Wells Fargo Bank, National Association, as administrative agent, and the other lenders party thereto~~amended (incorporated by reference to Exhibit ~~10.1~~3.1 to our Current Report on Form 8-K filed with the SEC on ~~February 10, 2017)~~

~~10.2~~		Third Amended and Restated Credit Agreement, dated as of February 7, 2017, by and among Gray Television, Inc., as Borrower, the lenders party thereto, Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Bank, Bank of America, N.A. and Royal Bank of Canada, as Syndication Agent, Deutsche Bank AG New York Branch, as Documentation Agent and Wells Fargo Securities, LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets and Deutsche Bank Securities Inc., as Joint Lead Arrangers and Bookrunners (incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K filed with the SEC on February 10, 2017)May 8, 2018)

31.1		Rule 13(a) – 14(a) Certificate of Chief Executive Officer

31.2		Rule 13(a) – 14(a) Certificate of Chief Financial Officer

32.1		Section 1350 Certificate of Chief Executive Officer

32.2		Section 1350 Certificate of Chief Financial Officer

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

		GRAY TELEVISION, INC.



Date:May ~~4, 2017~~ 8, 2018	By:	/s/ James C. Ryan
		James C. Ryan
		Executive Vice President and Chief Financial Officer