Item 4 — Purpose of Transaction
This Amendment No. 1 amends the Schedule 13D initially filed on January 8, 2025. On January 25, 2025, Gate City Capital Management ("Gate City") sent the letter attached as Exhibit A (the "January Letter") to Saga Communications, Inc. ("Saga" or the "Company"). The January Letter highlights Gate City's concerns that the Company's pursuit of a digital transformation was having an adverse impact on the Company's financial results, operations, liquidity and share price. On February 10, 2025, representatives from Gate City spoke with representatives from Saga to review the January Letter. Following this conversation, representatives from Gate City became increasingly concerned that Saga intended to continue spending heavily in the Company's digital transformation initiatives. Representatives from Gate City expressed its concerns that these digital initiatives were outside of the Company's core competencies, Saga had minimal managerial expertise in executing the Company's digital transformation strategy, and the digital transformation efforts would divert managerial time, attention and resources away from the Company's core broadcast business. Following the conversation between Gate City and Saga on February 10, 2025, Gate City sent a letter to Saga on February 11, 2025 informing the Company of Gate City's intent to nominate four directors at the upcoming 2025 annual meeting (the "February Letter"), which is attached as Exhibit B. Representatives from Gate City and Saga subsequently entered into formal negotiations to appoint one of Gate City's potential nominees to the Saga Board of Directors. These negotiations concluded without a formal agreement on March 4, 2025. Given the failure to reach a negotiated settlement of these issues, Gate City is exploring a variety of its options. Gate City remains disappointed in the Company's pursuit of a digital transformation strategy that Gate City believes is likely to prove value destructive for shareholders. "