What changed in this filing

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Item 1. Financial Statements

2024-08-09 compared with 2024-05-10 · 162 added, 95 removed, 332 unchanged (44% of the section changed)

26 unchanged sentences

Deferred income taxes

Long-term debt

Other liabilities

12 unchanged sentences

Three Months Ended

Six Months Ended

(In thousands, except per share data)

3 unchanged sentences

Other operating expense, net

Operating (loss) income

Operating income (loss)

Interest expense

Interest income

Income (loss) before income tax expense

Income tax provision (benefit)

Net (loss) income

Earnings (loss) per share:

Income before income tax expense

Income tax provision

Earnings per share:

Weighted average common shares

4 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

For the three months ended March 31, 2024 and 2023

For the three and six months ended June 30, 2024 and 2023

Stockholders’

6 unchanged sentences

Balance at March 31, 2023

Net income, three months ended June 30, 2023

Forfeiture of restricted stock

Dividends declared per common share

Compensation expense related to restricted stock awards

Purchase of shares held in treasury

Balance at June 30, 2023

Stockholders’

1 unchanged sentence

Balance at December 31, 2023

Net income (loss), three months ended March 31, 2024

Net loss, three months ended March 31, 2024

Dividends declared per common share

2 unchanged sentences

Balance at March 31, 2024

Net income, three months ended June 30, 2024

Forfeiture of restricted stock

Dividends declared per common share

Compensation expense related to restricted stock awards

Balance at June 30, 2024

See accompanying notes to unaudited condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

(In thousands)

1 unchanged sentence

Cash flows from operating activities:

Net (loss) income

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

Deferred income tax expense (benefit)

Deferred income tax expense

Amortization of deferred costs

13 unchanged sentences

Acquisition of property and equipment (Capital Expenditures)

Acquisition of broadcast properties

Proceeds from sale and disposal of assets

Proceeds from other gains and losses

Other investing activities

Net cash provided by (used in) investing activities

Net cash used in investing activities

Cash flows from financing activities:

Proceeds from long-term debt

Cash dividends paid

10 unchanged sentences

Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for annual financial statements.

In our opinion, the accompanying financial statements include all adjustments of a normal, recurring nature considered necessary for a fair presentation of our financial position as of March 31, 2024 and the results of operations for the three months ended March 31, 2024 and 2023.

Results of operations for three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

In our opinion, the accompanying financial statements include all adjustments of a normal, recurring nature considered necessary for a fair presentation of our financial position as of June 30, 2024 and the results of operations for the three and six months ended June 30, 2024 and 2023.

Results of operations for three and six months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

We own or operate broadcast properties in 28 markets, including 82 FM and 32 AM radio stations and 79 metro signals.

For further information, refer to the consolidated financial statements and footnotes thereto included in the Saga Communications, Inc.

(the “Company”) annual report on Form 10-K for the year ended December 31, 2023.

We have evaluated events and transactions occurring subsequent to the balance sheet date of March 31, 2024, for items that should potentially be recognized in these financial statements or discussed within the notes to these financial statements.

annual report on Form 10-K for the year ended December 31, 2023.

We have evaluated events and transactions occurring subsequent to the balance sheet date of June 30, 2024, for items that should potentially be recognized in these financial statements or discussed within the notes to these financial statements.

Earnings Per Share Information

1 unchanged sentence

The two-class method is an earnings allocation formula that determines earnings per share for each class of common stock and participating security.

The Company has participating securities related to restricted stock units, granted under the Company’s Second Amended and Restated 2005 Incentive Compensation Plan, that earn dividends on an equal basis with common shares.

The Company has participating securities related to restricted stock units, granted under the Company’s Second Amended and Restated 2005 Incentive Compensation Plan and the Company’s 2023 Incentive Compensation Plan, that earn dividends on an equal basis with common shares.

In applying the two-class method, earnings are allocated to both common shares and participating securities.

3 unchanged sentences

Three Months Ended

Six Months Ended

(In thousands, except per share data)

Net (loss) income

Income (loss) allocated to unvested participating securities

Net (loss) income available to common shareholders

Income allocated to unvested participating securities

Net income available to common shareholders

Denominator for basic earnings per share — weighted average shares

2 unchanged sentences

Denominator for diluted earnings per share — adjusted weighted-average shares and assumed conversions

Earnings (loss) per share:

There were no stock options outstanding that had an antidilutive effect on our earnings per share calculation for the three months ended March 31, 2024 and 2023, respectively.

Earnings per share:

There were no stock options outstanding that had an antidilutive effect on our earnings per share calculation for the three and six months ended June 30, 2024 and 2023, respectively.

The actual effect of these shares, if any, on the diluted earnings per share calculation will vary significantly depending on the fluctuation in the stock price.

2 unchanged sentences

held-to-maturity, available-for-sale, or trading securities, and depending upon the classification, value the security at amortized cost or fair market value.

At March 31, 2024 and December 31, 2023, we have recorded $ 8.6 million and $ 10.6 million, respectively, of held-to-maturity U.S.

Treasury Bills at amortized cost basis that have a fair market value of $ 8.6 million and $ 10.6 million, respectively.

At June 30, 2024 and December 31, 2023, we have recorded $ 8.7 million and $ 10.6 million, respectively, of held-to-maturity U.S.

Treasury Bills and Treasury Notes at amortized cost basis that have a fair market value of $ 8.7 million and $ 10.6 million, respectively.

Our held-to-maturity U.S.

Treasury Bills currently all have original maturity dates ranging from April 2024 to July 2024.

Treasury Bills and Treasury Notes all have original maturity dates ranging from July 2024 to December 2024.

Our financial instruments are comprised of cash and cash equivalents, short-term investments, accounts receivable, accounts payable and long-term debt.

The carrying value of cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to their short maturities.

The carrying value of long-term debt approximates fair value as it carries interest rates that either fluctuate with the secured overnight finance rate (“SOFR”), prime rate or have been reset at the prevailing market rate at March 31, 2024.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Allowance for Credit Losses

A provision for credit losses is recorded based on our judgment of collectability of receivables.

Allowance for Doubtful Accounts

A provision for doubtful accounts is recorded based on our judgment of collectability of receivables.

Amounts are written off when determined to be fully uncollectible.

3 unchanged sentences

In the event we recover amounts previously written off, we will reduce the specific allowance for credit loss.

Our allowance for credit losses was $ 913,000 and $ 618,000 at March 31, 2024 and December 31, 2023, respectively.

Our allowance for doubtful accounts was $ 1,009,000 and $ 618,000 at June 30, 2024 and December 31, 2023, respectively.

Our effective tax rate is higher than the federal statutory rate as a result of the inclusion of state taxes in the income tax amount and permanent differences related to executive compensation.

We have historically calculated the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full fiscal year to “ordinary” income or loss (pretax income or loss excluding unusual or infrequently occurring discrete items) for the reporting period.

We serve twenty-seven radio markets (reporting units) that aggregate into one operating segment (Radio), which also qualifies as a reportable segment.

We serve twenty-eight radio markets (reporting units) that aggregate into one operating segment (Radio), which also qualifies as a reportable segment.

We operate under one reportable business segment for which segment disclosure is consistent with the management decision-making process that determines the allocation of resources and the measuring of performance.

8 unchanged sentences

Assets and liabilities related to the TBAs/LMAs are included in the accompanying unaudited Condensed Consolidated Balance Sheets.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Recent Accounting Pronouncements

8 unchanged sentences

We are currently evaluating the impact ASU 2023-09 will have on our financial statement disclosures.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Nature of goods and services

11 unchanged sentences

Revenue is generally recognized when the event is completed, as the promotional events are completed or as each performance obligation is satisfied.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Disaggregation of Revenue

Revenues from contracts with customers comprised the following for three months ended March 31, 2024 and 2023:

Revenues from contracts with customers comprised the following for three and six months ended June 30, 2024 and 2023:

Three Months Ended

Six Months Ended

(in thousands)

Types of Revenue

9 unchanged sentences

Generally all contract liabilities are expected to be recognized within one year and are included in accounts payable in the Company’s Condensed Consolidated Financial Statements and are immaterial.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Transaction Price Allocated to the Remaining Performance Obligations

17 unchanged sentences

Amortizable intangible assets are included in other intangibles, deferred costs and investments in the consolidated balance sheets.

The Company considered the current and expected future economic and market conditions, and other potential indicators of impairment and determined a triggering event had not occurred which would necessitate any interim impairment tests during the three months ended March 31, 2024.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

We will continue to monitor changes in economic and market conditions, and if any event or circumstances indicate a triggering event has occurred, we will perform an interim impairment test of our intangible assets at the appropriate time.

5 unchanged sentences

Customer relationships are amortized over three years .

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Common Stock and Treasury Stock

Our founder, Chairman, President and CEO, Edward K.

Our founder and former Chairman, President and CEO, Edward K.

Christian, passed away on August 19, 2022.

9 unchanged sentences

Voting Rights.

Holders of shares of Common Stock vote as a single class on all matters submitted to a vote of the stockholders, with each share of Class A Common Stock entitled to one vote.

Holders of shares of Common Stock vote as a single class on all matters submitted to a vote of the shareholders, with each share of Class A Common Stock entitled to one vote.

Christian’s passing, each share of Class B Common Stock was entitled to ten votes, except (i) in the election for directors, (ii) with respect to any “going private” transaction between the Company and the principal stockholder, and (iii) as otherwise provided by law.

2 unchanged sentences

The Board of Directors consisted of eight members at December 31, 2023.

Currently, our Board of Directors consists of eight members.

Currently, our Board of Directors consists of seven members.

Holders of Common Stock are not entitled to cumulative voting in the election of directors.

The holders of the Common Stock vote as a single class with respect to any proposed “going private” transaction with the principal stockholder or an affiliate of the principal stockholder, with each share of each class of Common Stock entitled to one vote per share.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Under Florida law, the affirmative vote of the holders of a majority of the outstanding shares of any class of common stock is required to approve, among other things, a change in the designations, preferences and limitations of the shares of such class of common stock.

1 unchanged sentence

Upon our liquidation, dissolution, or winding-up, the holders of Class A Common Stock are entitled to share ratably in accordance with the number of shares held in all assets available for distribution after payment in full of creditors.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following summarizes information relating to the number of shares of our common stock issued in connection with stock transactions through March 31, 2024:

The following summarizes information relating to the number of shares of our common stock issued in connection with stock transactions through June 30, 2024:

Common Stock Issued

3 unchanged sentences

Balance, December 31, 2023

Balance, March 31, 2024

Forfeiture of restricted stock

Balance, June 30, 2024

We have a Stock Buy-Back Program to allow us to purchase up to $ 75.8 million of our Class A Common Stock.

As of March 31, 2024, we have remaining authorization of $ 18.0 million for future repurchases of our Class A Common Stock.

As of June 30, 2024, we have remaining authorization of $ 18.0 million for future repurchases of our Class A Common Stock.

On September 14, 2017, the Board of Directors authorized the repurchase of our Class A Common Stock under our trading plan adopted pursuant to Securities and Exchange Commission Rule 10b5-1.

6 unchanged sentences

We continue to monitor economic conditions to determine if and when it makes sense to make additional buybacks under our plan.

During the three months ended March 31, 2024 and 2023, no shares were repurchased under the Stock Buy-Back Program.

During the three and six months ended June 30, 2024 and 2023, no shares were repurchased under the Stock Buy-Back Program.

We lease certain land, buildings and equipment for use in our operations.

5 unchanged sentences

Our lease agreements do not contain any residual value guarantees or material restrictive covenants.

As of March 31, 2024, we do not have any non-cancellable operating lease commitments that have not yet commenced.

As of June 30, 2024, we do not have any non-cancellable operating lease commitments that have not yet commenced.

ROU assets are classified within other intangibles, deferred costs and investments, net on the condensed consolidated balance sheet while current lease liabilities are classified within other accrued expenses and long-term lease liabilities are classified within other liabilities.

Leases with an initial term of 12 months or less are not recorded on the balance sheet.

ROU assets were $ 6.6 million and $ 7.0 million at March 31, 2024 and December 31, 2023 respectively.

Lease liabilities were $ 6.8 million and $ 7.3 million at March 31, 2024 and December 31, 2023, respectively.

During the three months ended March 31, 2024, we did not record any additional ROU assets under operating leases.

Payments on lease liabilities during the three months ended March 31, 2024 and 2023 totaled $ 528,000 , and $ 526,000 , respectively.

Lease expense includes cost for leases with terms in excess of one year.

For the three months ended March 31, 2024 and 2023, our total lease expense was $ 475,000 , and $ 460,000 , respectively.

Short-term lease costs are de minimis in nature.

ROU assets were $ 6.5 million and $ 7.0 million at June 30, 2024 and December 31, 2023 respectively.

Lease liabilities were $ 6.8 million and $ 7.3 million at June 30, 2024 and December 31, 2023, respectively.

During the six months ended June 30, 2024, we recorded additional ROU assets under operating leases of $ 282,000 .

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

We have no financing leases and minimum annual rental commitments under non-cancellable operating leases consisted of the following at March 31, 2024 (in thousands):

lease liabilities during the three and six months ended June 30, 2024 and 2023 totaled $ 445,000 , $ 973,000 , $ 415,000 , and $ 941,000 , respectively.

Lease expense includes cost for leases with terms in excess of one year.

For the three and six months ended June 30, 2024 and 2023, our total lease expense was $ 475,000 , $ 950,000 , $ 457,000 and $ 917,000 , respectively.

Short-term lease costs are de minimis in nature.

We have no financing leases and minimum annual rental commitments under non-cancellable operating leases consisted of the following at June 30, 2024 (in thousands):

Years Ending December 31,

1 unchanged sentence

Present value of lease liabilities (d)

(a) Remaining payments are for the nine-months ending December 31, 2024.

(a) Remaining payments are for the six-months ending December 31, 2024.

(b) Lease payments include options to extend lease terms that are reasonably certain of being exercised.

There were no legally binding minimum lease payments for leases signed but not yet commenced at March 31, 2024.

There were no legally binding minimum lease payments for leases signed but not yet commenced at June 30, 2024.

Therefore, we must estimate our discount rate for such leases to determine the present value of lease payments at the lease commencement date.

(d) The weighted average remaining lease term and weighted average discount rate used in calculating our lease liabilities were 6.3 years and 5.5 % , respectively, at March 31, 2024.

(d) The weighted average remaining lease term and weighted average discount rate used in calculating our lease liabilities were 6.3 years and 5.5 % , respectively, at June 30, 2024.

Acquisitions and Dispositions

5 unchanged sentences

Management assigned fair values to the acquired property and equipment through a combination of cost and market approaches based upon each specific asset’s replacement cost, with a provision for depreciation, and to the acquired intangibles, primarily an FCC license, based on the Greenfield valuation methodology, a discounted cash flow approach.

Pending Acquisitions

2024 Acquisitions and Dispositions

On February 13, 2024, we entered into an agreement to purchase the assets of WKOA (FM), WKHY (FM), WASK (FM), WXXB (FM), WASK (AM) and W269DJ from Neuhoff Communications, Inc.

serving the Greater Lafayette, Indiana radio market for $ 5.3 million which we expect to finance through funds generated from operations or borrowings under our credit agreement.

During the first quarter of 2024, we have placed an escrow deposit of $ 250,000 for this acquisition.

We expect to close on this acquisition in the second quarter of 2024.

2024 Dispositions

serving the Greater Lafayette, Indiana radio market for $ 5.3 million, subject to certain purchase price adjustments.

The Company closed on this transaction on May 31, 2024, using funds from operations and borrowings under our credit agreement, of $ 5,850,000 , which included the purchase price of $ 5,300,000 , the purchase of $ 482,000 in accounts receivable and certain closing adjustments and transactional costs of approximately $ 68,000 .

Management attributes the goodwill recognized in the acquisition to the power of the existing brands in Lafayette, Indiana as well as synergies and growth opportunities expected through the combination with the Company’s existing stations.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

On May 31, 2024, we closed on an agreement to sell WNDN-FM located in our Ocala-Gainesville, Florida market to Suncoast Radio, Inc.

for $ 150,000 .

We recorded a $ 20,000 loss on the sale in our other operating (income) expense , net line on our Condensed Consolidated Statement of Operations.

On March 29, 2024, we closed on an agreement to sell WYSE-AM, W275CP translator and W248CM translator located in our Asheville, North Carolina market to EZ Radio LLC for $ 10,000 .

1 unchanged sentence

On March 22, 2024, we submitted a request to the FCC to cancel our FCC license for KBAI-AM located in our Bellingham, Washington market.

We recorded a $ 800,000 loss on the disposal in our other operating (income) expense, net line item on our Condensed Consolidated Statement of Operations.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

We recorded an $ 800,000 loss on the disposal in our other operating (income) expense, net line item on our Condensed Consolidated Statement of Operations.

2023 Dispositions

3 unchanged sentences

We recorded a $ 22,000 loss on the disposal in our other operating (income) expense, net line item on our Condensed Consolidated Statement of Operations.

An income tax benefit of $ 580,000 was recorded for the three months ended March 31, 2024 compared to income tax expense of $ 350,000 for the three months ended March 31, 2023.

The effective tax rate was approximately 26.9 % for the three months ended March 31, 2024 compared to 27.6 % for the three months ended March 31, 2023.

Condensed Consolidated Balance Sheet of 2024 and 2023 Acquisitions:

The following unaudited condensed balance sheets represent the estimated fair value assigned to the related assets and liabilities of the 2024 and 2023 acquisitions.

The allocation of the purchase price for the 2024 acquisition is preliminary at June 30, 2024.

Saga Communications, Inc.

Condensed Consolidated Balance Sheet of 2024 and 2023 Acquisitions

Acquisitions in

(In thousands)

Assets Acquired:

Current assets

Property and equipment

Other assets:

Broadcast licenses

Other intangibles, deferred costs and investments

Total other assets

Total assets acquired

Liabilities Assumed:

Current liabilities

Total liabilities assumed

Net assets acquired

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Pro Forma Results of Operations for Acquisitions (Unaudited)

The following unaudited pro forma results of our operations for the three months ended June 30, 2024 and 2023 assume the 2024 acquisitions occurred as of January 1, 2023.

The pro forma results give effect to certain adjustments, including depreciation, amortization of intangible assets, increased interest expense on acquisition debt and related income tax effects.

The pro forma results have been prepared for comparative purposes only and do not purport to indicate the results of operations that would actually have occurred had the combinations been in effect on the dates indicated or which may occur in the future.

Three Months Ended

Six Months Ended

(In thousands, except per share data)

Pro forma Consolidated Results of Operations

Net operating revenue

Station operating expense

Corporate general and administrative

Other operating expense, net

Operating income (loss)

Interest expense

Interest income

Other income, net

Income before income tax expense

Income tax provision

Earnings per share:

An income tax expense of $ 955,000 was recorded for the three months ended June 30, 2024 compared to $ 1,250,000 for the three months ended June 30, 2023.

The effective tax rate was approximately 27.6 % for the three months ended June 30, 2024 compared to 27.2 % for the three months ended June 30, 2023.

An income tax expense of $ 375,000 was recorded for the six months ended June 30, 2024 compared to $ 1,600,000 for the six months ended June 30, 2023.

The effective tax rate was approximately 28.9 % for the six months ended June 30, 2024 compared to 27.3 % for the six months ended June 30, 2023.

Income tax provisions for interim (quarterly) periods are based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e.

4 unchanged sentences

2005 Incentive Compensation Plan (as amended, the “Second Restated 2005 Plan”).

This plan was first approved in 2005, and subsequently re-approved in 2010 and 2013.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

was first approved in 2005, and subsequently re-approved in 2010 and 2013.

The amendment to the Second Restated 2005 Plan (i) extended the date for making awards to September 6, 2023 and (ii) increased the number of authorized shares under the Plan by 90,000 shares of Class B Common Stock.

12 unchanged sentences

The number of shares of Common Stock that may be issued under the 2023 Plan may not exceed 600,000 shares of Class A Common Stock.

The Form of Restricted Stock Option Agreements for Employees and Directors under the 2023 Plan have been filed as exhibits to this Form 10-Q are incorporated by reference.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Stock-Based Compensation

All stock options granted were fully vested and expensed at December 31, 2012;

therefore, there was no compensation expense related to stock options for the three months ended March 31, 2024 and 2023, respectively.

There were no stock options granted during 2024 or 2023 and there were no stock options outstanding as of March 31, 2024.

therefore, there was no compensation expense related to stock options for the three and six months ended June 30, 2024 and 2023, respectively.

There were no stock options granted during 2024 or 2023 and there were no stock options outstanding as of June 30, 2024.

All outstanding stock options were exercised in 2017.

The following summarizes the restricted stock transactions for the three months ended March 31, 2024:

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following summarizes the restricted stock transactions for the three and six months ended June 30, 2024:

Outstanding at January 1, 2024

Non-vested and outstanding at March 31, 2024

For the three months ended March 31, 2024 and 2023, we had $ 453,000 and $ 245,000 , respectively, of total compensation expense related to restricted stock-based compensation arrangements.

Non-vested and outstanding at June 30, 2024

For the three and six months ended June 30, 2024 and 2023, we had $ 520,000 , $ 973,000 , $ 248,000 and $ 493,000 , respectively, of total compensation expense related to restricted stock-based compensation arrangements.

This expense is included in corporate general and administrative expenses in our results of operations.

The associated tax benefit recognized for the three months ended March 31, 2024 and 2023 was $ 119,000 and $ 64,000 , respectively.

The associated tax benefit recognized for the three and six months ended June 30, 2024 and 2023 was $ 137,000 , $ 256,000 , $ 65,000 and $ 129,000 , respectively.

Long-Term Debt

The Company has no debt outstanding at December 31, 2023 or March 31, 2024.

Long-term debt consisted of the following:

(In thousands)

Revolving credit facility

Amounts payable within one year

On December 19, 2022, we entered into a Third Amendment to our Credit Facility, (the “Third Amendment”), which extended the maturity date to December 19, 2027, reduced the lenders to JPMorgan Chase Bank, N.A., and the Huntington National Bank (the “Lenders”), established an interest rate equal to the secured overnight financing rate (“SOFR”) as administered by the SOFR Administrator (currently established as the Federal Reserve Bank of New York) as the interest base and increased the basis points.

2 unchanged sentences

These debt issuance costs are included in other assets, net in the consolidated balance sheets.

As a result of the Second Amendment to our Credit Facility (the “Second Amendment”), the Company incurred an additional $ 120,000 of transaction fees related to the Credit Facility that were capitalized.

As a result of the Second Amendment, the Company incurred an additional $ 120,000 of transaction fees related to the Credit Facility that were capitalized.

As a result of the Third Amendment, the Company incurred an additional $ 161,000 of transaction fees related to the Credit Facility that were capitalized.

The cumulative transaction fees are being amortized over the remaining life of the Credit Facility.

Interest rates under the Credit Facility are payable, at our option, at alternatives equal to SOFR ( 5.34 % at March 31, 2024), plus 1 % to 2 % or the base rate plus 0 % to 1 % .

The spread over SOFR and the base rate vary from time to time, depending upon our financial leverage.

Letters of credit issued under the Credit Facility will be subject to a participation fee (which is equal to the interest rate applicable to Eurocurrency Loans, as defined in the Credit Agreement) payable to each of the Lenders and a fronting fee equal to 0.25 % per annum payable to the issuing bank.

Under the Third Amendment, we now pay quarterly commitment fees of 0.25 % per annum on the unused portion of the

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Credit Facility.

Interest rates under the Credit Facility are payable, at our option, at alternatives equal to SOFR ( 5.33 % at June 30, 2024), plus 1 % to 2 % or the base rate plus 0 % to 1 % .

The spread over SOFR and the base rate vary from time to time, depending upon our financial leverage.

Under the Third Amendment, we now pay quarterly commitment fees of 0.25 % per annum on the unused portion of the Credit Facility.

We previously paid quarterly commitment fees of 0.2 % to 0.3 % per annum on the unused portion of the Revolving Credit Facility.

The Credit Facility contains a number of financial covenants (all of which we were in compliance with at March 31, 2024) which, among other things, require us to maintain specified financial ratios and impose certain limitations on us with respect to investments, additional indebtedness, dividends, distributions, guarantees, liens and encumbrances.

We have approximately $ 50 million of unused borrowing capacity under the Revolving Credit Facility at both March 31, 2024 and December 31, 2023.

The Credit Facility contains a number of financial covenants (all of which we were in compliance with at June 30, 2024) which, among other things, require us to maintain specified financial ratios and impose certain limitations on us with respect to investments, additional indebtedness, dividends, distributions, guarantees, liens and encumbrances.

We had approximately $ 45 million and $ 50 million of unused borrowing capacity under the Revolving Credit Facility at June 30, 2024 and December 31, 2023, respectively.

From time to time, the Company may be involved in various legal proceedings that are incidental to the Company’s business.

In management’s opinion, the Company is not a party to any current legal proceedings that are material to its financial condition, either individually or in the aggregate.

During 2024, the Company’s Board of Directors declared a quarterly cash dividend and a variable cash dividend on its Class A Common Stock.

These dividends totaling approximately $ 5.3 million were accrued or paid during the first quarter of 2024.

During 2023, our Board of Directors declared four quarterly cash dividends and one special dividend totaling $ 3.00 per share on our Class A shares.

These dividends totaling approximately $ 18.6 million were accrued or paid during 2023.

During 2024, the Company’s Board of Directors has declared two quarterly cash dividends and a variable dividend on its Class A Common Stock.

These dividends totaling $ 1.10 per share and approximately $ 6.9 million were paid during 2024.

During 2023, the Company’s Board of Directors declared four quarterly cash dividends and one special dividend on its Class A Common Stock.

These dividends totaling $ 3.00 per share and approximately $ 18.6 million were accrued or paid during 2023.

The Company currently intends to declare regular quarterly cash dividends as well as variable dividends in accordance with the terms of its variable dividend policy.

As previously reported, our Board adopted a variable dividend policy for the allocation of available cash aligned with the goals of maintaining a strong balance sheet, increasing cash returns to shareholders, and continuing to grow the Company through strategic acquisitions.

The Company may also declare special dividends and implementation of stock buybacks in future periods.

The Company may also declare special dividends and implement stock buybacks in future periods.

The declaration and payment of any future dividend, whether fixed, special, or based on the variable policy, or the implementation of any stock buyback program will remain at the full discretion of the Board and will depend on the Company’s financial results, cash requirements, future expectations, and other pertinent factors.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

During the second quarter of 2024, the Company received $ 1,133,000 related to the sale of an investment in Broadcast Music, Inc.

(“BMI”) and recorded a gain of $ 1,133,000 .

The gain on sale of investment is recorded in other (income) expense, net in the Company’s Condensed Consolidated Statement of Operations.

In 2012, Congress mandated that the FCC conduct an incentive auction of broadcast television spectrum as set forth in the Middle Class Tax Relief and Job Creation Act of 2012 ("Spectrum Act").

3 unchanged sentences

During the first quarter of 2023, we received approximately $ 115,000 in reimbursement for our FM stations.

This reimbursements was recorded in other (income), expense, net, in the Company’s Condensed Consolidated Statement of Operations.

This reimbursement was recorded in other (income), expense, net, in the Company’s Condensed Consolidated Statement of Operations.

We do not anticipate receiving any additional reimbursements.

SAGA COMMUNICATIONS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Commitments and Contingencies

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements