43196--4/7/2010--GRAY_TELEVISION

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{capital, credit, financial}

{stock, price, share}

{debt, indebtedness, cash}

{operation, natural, condition}

{tax, income, asset}

{regulation, government, change}

{customer, product, revenue}

{financial, litigation, operation}

Our operating and financial flexibility is limited by the terms of our senior credit facility. Servicing our debt and other obligations requires a significant amount of cash, and our ability to generate sufficient cash depends on many factors, some of which are beyond our control. Our operating and financial flexibility is limited by the terms of our Series D Perpetual Preferred Stock. We have suspended cash dividends on both classes of our common stock and have not paid certain accumulated dividends under our Series D Perpetual Preferred Stock. To the extent a potential investor ascribes value to a dividend paying stock, the value of our stock may be correspondingly reduced. We may not be able to maintain the NYSE listings for our common stock and/or Class A common stock. We have, in the past, incurred impairment charges on our goodwill and/or broadcast licenses, and any such future charges may have a material effect on the value of our total assets. We must purchase television programming in advance but cannot predict whether a particular show will be popular enough to cover its cost. We are highly dependent upon our network affiliations, and may lose a large amount of television programming if a network (i) terminates its affiliation with us, (ii) significantly changes the economic terms and conditions of any future affiliation agreements with us or (iii) significantly changes the type, quality or quantity of programming provided to us under an affiliation agreement. We operate in a highly competitive environment. Competition occurs on multiple levels (for audiences, programming and advertisers) and is based on a variety of factors. If we are not able to successfully compete in all relevant aspects, our revenues will be materially adversely affected. Our dependence upon a single advertising category could adversely affect our business. The required phased-in introduction of digital television will continue to require us to incur significant capital and operating costs and may expose us to increased competition. Any potential hostilities or terrorist attacks, or similar events leading to broadcast interruptions, may affect our revenues and results of operations. Risks Related to Regulatory Matters Federal broadcasting industry regulation limits our operating flexibility. The FCC s duopoly restrictions limit our ability to own and operate multiple television stations in the same market and our ability to own and operate a television station and newspaper in the same market.

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43196--4/7/2010--GRAY_TELEVISION_INC