Gray Television, Inc. today announced that it completed a series of transactions that resulted in Gray acquiring 12 television stations and programming of three additional television stations from Hoak Media, LLC and Parker Broadcasting, Inc. In addition, Gray completed the refinancing of its senior credit facility, which now consists of a seven-year $525 million term loan facility and a five-year $50 million revolving credit facility. The proceeds from the term loan were used primarily to complete the Hoak Acquisition for approximately $306 million including working capital adjustments and to refinance $159 million outstanding under our previously existing term loan, pay transaction fees and expenses, and for other general corporate purposes. We did not draw any amounts under the refinanced revolving credit facility.
The Hoak Acquisition significantly expanded Gray's growing portfolio of market-leading owned and/or operated television stations with the acquisition of the following television stations:
| STATION | AFFILIATION | MARKET | MARKET RANK |
| KSFY | ABC | Sioux Falls, SD | 111 |
| KABY* | ABC | Sioux Falls, SD | 111 |
| KPRY* | ABC | Sioux Falls, SD | 111 |
| KVLY | NBC | Fargo-Valley City, ND | 116 |
| KNOE | CBS | Monroe- El Dorado, LA | 137 |
| KFYR | NBC | Minot-Bismarck-Dickinson, ND | 145 |
| KMOT* | NBC | Minot-Bismarck-Dickinson, ND | 145 |
| KUMV* | NBC | Minot-Bismarck-Dickinson, ND | 145 |
| KQCD* | NBC | Minot-Bismarck-Dickinson, ND | 145 |
| KALB | NBC/CBS | Alexandria, LA | 179 |
| KNOP | NBC | North Platte, NE | 208 |
| KIIT-LP | FOX | North Platte, NE | 208 |
| * satellite station | |||
When announcing the Hoak Acquisition on November 20, 2013, Gray reported that Excalibur Broadcasting, LLC would acquire five television stations in existing or future Gray markets from Hoak, Parker, and Prime Cities Broadcasting, Inc., and that Gray would operate these stations through shared services agreements. As a result of new FCC policies announced and imposed after the parties entered into those agreements, Excalibur and its counter-parties have abandoned those transactions.
Nevertheless, Gray has secured alternative agreements with Hoak, Parker, and Prime Cities whereby Gray will be able to attain the economic benefits sought in the original set of agreements.
In particular:
- KHAS-TV, Lincoln-Hastings, Nebraska: Late last night, KHAS-TV ceased broadcasting. This morning, Hoak transferred to Gray all of the station's affiliation, programming, and operational agreements, as well as its tower, studio, and other tangible and intangible assets other than its FCC license and transmission equipment. At the same time, Gray hired KHAS-TV's employees. To preserve and expand NBC programming in the market, Gray launched a new "NBC Nebraska" service on the primary channel of one of its own stations in the Lincoln-Hastings, Nebraska market, KSNB-TV. To accommodate the new NBC service on KSNB-TV's primary channel, Gray moved the station's pre-existing program line-up consisting of MeTV Network, My Network, local news and other programming to KSNB-TV's channel 4.2.
- KNDX-TV/KXND-TV, Minot-Bismarck, North Dakota: Last month, Gray announced that it had acquired certain assets associated with KNDX-TV and KXND-TV, the Prime Cities stations operating as the Fox affiliate for the Minot-Bismarck, North Dakota market. Late last night, Prime Cities ceased broadcasting KNDX-TV in Bismarck and KXND-TV in Minot. Prime Cities, however, continued regular broadcasts on its low power stations in the Minot-Bismarck market, which are operated by Gray pursuant to a local marketing agreement until Gray completes its acquisition of the licenses of these low power stations.
Early this morning, KFYR-TV and the other NBC affiliated stations acquired by Gray in the Minot-Bismarck market began simulcasting the signals of the low power stations on their multicast channels. Consequently, the Fox and other programming previously offered by Prime Cities are now available from the Gray-owned and NBC affiliated stations in the market. The Fox operation will continue to be known as "KNDX" and "Western Dakota Fox."
- KXJB-TV (CBS) Fargo, North Dakota, and KAQY-TV (ABC), Monroe, Louisiana. As a result of the Hoak Acquisition, Gray assumed essentially all of Hoak's contracts. Included in those contracts were Hoak's rights to provide back-office services and limited programming to Parker's KXJB-TV and KAQY-TV through the former Hoak (now Gray) television stations located in Fargo and Monroe, respectively.
Gray has now closed on all previously announced transactions, other than its proposed acquisition of three television stations in Montana for approximately $2.0 million announced on May 7, 2014. (Gray operates two of these stations through a pre-closing local marketing agreement and sells advertising for the third station through a pre-existing joint sales agreement.) Including these Montana television stations, Gray now owns and/or operates television stations in 42 television markets broadcasting 139 program streams including 75 affiliates of the Big Four networks (ABC, CBS, NBC and FOX). We own and/or operate the number-one ranked television station in 28 of those 42 markets and the number-one or number-two ranked television station operations in 38 of those 42 markets.
Gray Television Stations:
