Gray Television, Inc. Capital Accumulation Plan
Notes to Financial Statements
1. Description of the
Plan
The following description of the Gray Television, Inc. Capital Accumulation Plan (the Plan) provides only general information.
Reference should be made to the Plan document for a more complete description of the Plans provisions.
General
The Plan was established and made effective October 1, 1994, for the administration and allocation of contributions by Gray Television, Inc. (the
Company or the Employer), and to encourage eligible employees to defer a part of their current income to provide for their retirement, death, or disability under the provisions of Section 401(k) of the Internal Revenue
Code. The Plan covers all employees of the Company and its subsidiaries. An employee is eligible to participate in the Plan beginning the first of the month following or coinciding with the date that he has completed 500 hours of service during his
initial six months of employment. If an employee does not complete 500 hours of service during his initial six months of employment, then he is eligible to participate beginning the first of the month following or coinciding with the date he has
completed one year of service. For acquired stations, the Company will determine eligibility for participation based on information in the buy/sell agreement. If no information is provided, the Company will honor previous service to determine
eligibility into the Plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The Company is the Plans sponsor. The Employee Benefits Committee is the Plan Administrator. Reliance
Trust Company (Reliance) is the Plans trustee. Empower Retirement (Empower), a subsidiary of Orchard Trust Company, serves as the Plans custodian and recordkeeper. In 2021, the Company acquired the outstanding
shares of Quincy Media, Inc and Meredith Corporation. This transaction increased the number of employees eligible to participate in the Plan and, therefore, the assets of the Plan. The closing of Quincy Media, Inc. was officially completed on August
2nd, 2021. Approximately $17,759,687 of assets rolled into the Gray Television, Inc. Capital Accumulation Plan as part of this transaction. In addition, the closing of Meredith Corporation was officially completed on December 1st, 2021. Employees of Meredith Corporation did not become participants of the Companys plan until January 1st, 2022.
Contributions
The Plan was amended and restated as of
December 1, 2020, to add Roth and after-tax contribution features, to allow for in-Plan Roth conversions, and make certain other clarifying changes. The Plan allows
participants to make contributions up to 100% of their compensation as before-tax contributions, and beginning December 1, 2020 as Roth and/or after-tax
contributions. If no deferral election is made, the participant shall be automatically enrolled in the Plan and will be deemed to have authorized the Company to defer 3% of the participants compensation to the Plan on a before-tax basis. Contribution percentages auto escalate by 1% each year if a participant does not change the contribution percentage from the default percentage. Employees may elect to opt out from being
automatically enrolled in the Plan. Participants may change their deferral percentages daily. Participants who have attained age 50 before the end of the Plan year are eligible to make before-tax catch-up contributions, which may also be made as Roth contributions beginning December 1, 2020. Participants may also contribute amounts representing distributions from other qualified defined contribution
plans.
Participants contributions and catch-up contributions for employees 50 and older on a before-tax and/or Roth basis are limited by the Internal Revenue Code Section 402(g)(1) to $20,500 and $6,500, respectively, in 2022. In addition, total annual additions to a participants account shall
not exceed the lesser of $61,000 or 100% of a participants annual compensation. Contributions by highly compensated employees are subject to additional restrictions.
The Employer shall contribute to the Plan a Qualified Automatic Contribution Arrangement (QACA) matching contribution. Under this arrangement, the Plan must
offer a schedule of minimum default percentages that start at 3%, which must increase each year to at least 6%. The QACA matching contribution is equal to a percentage of the eligible contributions of Plan participants not to exceed 3.5% of eligible
compensation as defined in the Plan document. The QACA matching contribution is 100% of the first 1% of eligible compensation, plus an additional 50% of the next 5% of eligible compensation. A true-up matching
contribution is made for participants who reached the contribution limit within the plan year. True-up matching contributions are issued after the end of the plan year but no later than September 15th of the
following plan year.
The Employer may also elect to make a discretionary profit-sharing contribution, as determined by a declaration of its Board of
Directors, to each active participants account based on such participants years of service and eligible compensation during the year. For the year ended December 31, 2022, the Employer made a discretionary profit-sharing
contribution of $8,789,307 in the form of Employer stock, which was recorded as Employer contributions receivable as of December 31, 2022, and was remitted to the Plan in March 2023. Plan participants who have satisfied the applicable
eligibility requirements and are employed by the Company as of December 31 of the plan year are eligible to receive such contribution.
Investment
Options
Participants may direct their contributions, Employer contributions, and any related earnings into investment options sponsored by the Plan.
The Plan currently offers twenty-eight mutual funds, one stable value fund, a self-directed brokerage account, and Employer common stock as investment options for participants. Participants may change their investment elections daily by phone or via
the internet.
4