Company: SDHC
Filing Date: 2025-04-23
Form Type: DEF 14A
Source: 0001982518-25-000012
Chunk: 59

Company: Smith Douglas Homes Corp.
Filing Date: 2025-04-23
Form: DEF 14A
Chunk 59
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 conflict with our interests and your interests, and the Continuing Equity Owners may exercise their consent rights relating to any such challenge in a manner adverse to our interests and your interests.

The Tax Receivable Agreement requires us to provide the Continuing Equity Owners with a schedule showing the calculation of payments due under the Tax Receivable Agreement. We are required to provide such schedule within 90 days after filing our U.S. federal income tax return for each taxable year with respect to which a payment obligation arises. This calculation will be based upon the advice of our tax advisors. Payments under the Tax Receivable Agreement will generally be made to the Continuing Equity Owners within five business days after this schedule becomes final pursuant to the procedures set forth in the Tax Receivable Agreement, although interest on such payments will begin to accrue at a rate equal to Secured Overnight Financing Rate (“SOFR”) plus 100 basis points from the due date (without extensions) of such tax return. Any late payments that may be made under the Tax Receivable Agreement will continue to accrue interest at a rate equal to SOFR plus 500 basis points, until such payments are made, generally including any late payments we may subsequently make because we did not have enough available cash to satisfy our payment obligations at the time they originally arose.

#### Prior LLC Agreement
Prior to the Transactions, Smith Douglas Holdings LLC and the Continuing Equity Owners were parties to the Operating Agreement of Smith Douglas Holdings LLC, dated as of September 21, 2023, as amended from time to time, which governed the business operations of Smith Douglas Holdings LLC and defined the relative rights and privileges associated with the existing units of Smith Douglas Holdings LLC. We refer to this agreement, as amended, as the Prior LLC Agreement. Under the Prior LLC Agreement, the board of managers of Smith Douglas Holdings LLC had the sole and exclusive right and authority to manage and control the business and affairs of Smith Douglas Holdings LLC, and the day-to-day business operations of Smith Douglas Holdings LLC were overseen and implemented by officers of Smith Douglas Holdings LLC. Each Original Equity Owner’s rights under the Prior LLC Agreement continued until the effective time of the Smith Douglas LLC Agreement, as described below, at which time the Continuing Equity Owners continued as members that hold LLC Interests with the respective rights thereunder.

#### Smith Douglas LLC Agreement
In connection with the consummation of the Transactions, we and the Continuing Equity Owners entered into the Smith Douglas LLC Agreement.

Appointment as managing member . Under the Smith Douglas LLC Agreement, we became a member and the sole manager of