Company: SDHC
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001982518-25-000020
Chunk: 77

Company: Smith Douglas Homes Corp.
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 8
Chunk 77
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 immediately repay all amounts outstanding under the Amended Credit Facility. As of March 31, 2025, the Company was in compliance with all covenants related to the Amended Credit Facility.As of March 31, 2025, there were $40.0 million of outstanding borrowings under the Amended Credit Facility. As of December 31, 2024, there were no outstanding borrowings under the Amended Credit Facility. As of March 31, 2025 and December 31, 2024, there were no outstanding letters of credit. Availability as determined in accordance with the Borrowing Base, as defined, totaled approximately $194.6 million as of March 31, 2025.On July 31, 2023, the Company entered into a three-year seller note payable of $5.0 million as part of the consideration for the acquisition of Devon Street which bears interest at 8% per annum. The seller note is payable in quarterly installments of principal and accrued interest beginning September 30, 2023 through maturity on September 30, 2026. The seller was previously employed as the division president of the Houston division until December 31, 2024. As of March 31, 2025 and December 31, 2024, the balance on the seller note payable was $2.6 million and $3.1 million, respectively, which is included in notes payable in the accompanying unaudited condensed consolidated balance sheets.

20

Future maturities of notes payable to third parties, including borrowings under the Amended Credit Facility, are as follows as of March 31, 2025 (in thousands):Year ending December 31, 2025 (1)$1,285 20261,363 202740,000  $42,648 (1)Remaining payments are for the nine months ending December 31, 2025.

Note 6 ‑ Fair value of financial instruments:

ASC Topic 820, Fair Value Measurements and Disclosures, establishes a framework for measuring fair value and disclosing fair value measurements. ASC Topic 820 establishes a three‑level hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs in measuring fair value. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date.•Level 1 ‑ Valuation is based on quoted prices in active markets for identical assets and liabilities;•Level