Company: UHG
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001830188-25-000079
Chunk: 53

Company: United Homes Group, Inc.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 1
Chunk 53
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 of the Company and its subsidiaries (as determined on the last day of each fiscal quarter) of (x) not less than 1.35 to 1.00 through December 31, 2025 and (y) thereafter greater than 1.50 to 1.00, provided that the Company and its subsidiaries may allow such debt service coverage ratio to be less than 1.35 to 1.00 in two instances from December 11, 2024 until December 31, 2025 so long as the debt service coverage ratio is greater than or equal to 1.20 to 1.00 as of the last day of such fiscal quarter; and (d) that the Company maintain minimum liquidity of not less than $20.0 million and unrestricted cash of not less than $10.0 million at all times. The obligations under the Credit Agreement are guaranteed by UHG and secured by a security interest in UHG’s 100% ownership and economic interest of GSH. The Company was in compliance with all debt covenants as of September 30, 2025 and December 31, 2024.The term loan was issued at an original issuance discount of $2.1 million, and the Company incurred debt issuance costs of $0.8 million that were allocated to the term loan, resulting in net cash proceeds of $67.1 million.

Note 7 - Related party transactionsLot depositsThe Company enters into option contracts with related parties to acquire lots for the construction of homes. Out of the lot deposits outstanding as of September 30, 2025 and December 31, 2024, $5.0 million and $6.8 million, respectively, are with related parties. LeasesThe Company has three separate operating lease agreements with a related party, including a lease of an office space used for its corporate headquarters. In addition, the Company leases certain model homes from related parties. During the second quarter of 2024, the Company modified the lease of its corporate headquarters to reduce the leased space for the premises, which was accounted for as a lease modification and partial termination. The Company recorded a gain of $0.2 million as a result of the modification. The terms of the related party leases, including rent expense and future minimum payments, are described in Note 9 - Commitments and contingencies.Services agreementThe Company previously shared office spaces with a related party and certain employees of the Company provided services to the same related party. As such