Company: SDHC
Filing Date: 2025-04-23
Form Type: DEF 14A
Source: 0001982518-25-000012
Chunk: 60

Company: Smith Douglas Homes Corp.
Filing Date: 2025-04-23
Form: DEF 14A
Chunk 60
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 Smith Douglas Holdings LLC. As the sole manager, we are able to control all of the day-to-day business affairs and decision-making of Smith Douglas Holdings LLC without the approval of any other member. As such, we, through our officers and directors, are responsible for all operational and administrative decisions of Smith Douglas Holdings LLC and daily management of Smith Douglas Holdings LLC’s business. Pursuant to the terms of the Smith Douglas LLC Agreement, we cannot be removed or replaced as the sole manager of Smith Douglas Holdings LLC except by our resignation, which may be given at any time by written notice to the members.

Compensation, fees, and expenses . We are not entitled to compensation for our services as the manager of Smith Douglas Holdings LLC. We are entitled to reimbursement by Smith Douglas Holdings LLC for reasonable fees and expenses incurred on behalf of Smith Douglas Holdings LLC, including all expenses associated with the Transactions, any subsequent offering of our Class A common stock, being a public company, and maintaining our corporate existence.

Distributions . The Smith Douglas LLC Agreement requires “tax distributions” (as that term is used in the agreement) to be made by Smith Douglas Holdings LLC to its members, except to the extent such distributions would

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render Smith Douglas Holdings LLC insolvent or are otherwise prohibited by law or any of our future debt agreements. Tax distributions will be made on a quarterly basis to each member of Smith Douglas Holdings LLC, including us, pro rata in accordance with economic interests and based on such member’s allocable share of the taxable income of Smith Douglas Holdings LLC and an assumed tax rate that will be determined by us, as described below. For this purpose, each member’s allocable share of Smith Douglas Holdings LLC’s taxable income shall be net of its allocable share of taxable losses of Smith Douglas Holdings LLC and our share of tax distributions shall be in amounts that permit us to satisfy our tax liabilities and our ordinary course payment obligations under the Tax Receivable Agreement. The assumed tax rate for purposes of determining tax distributions from Smith Douglas Holdings LLC to its members will be the highest combined U.S. federal, state, and local tax rate that may potentially apply to any one of Smith Douglas Holdings LLC’s members that is a resident of Atlanta, Georgia, regardless of the actual, final tax liability or resident status of any such member. The Smith Douglas LLC Agreement also allows for cash distributions to be made by Smith Douglas Holdings LLC (subject to our sole discretion as the sole manager of Smith Douglas Holdings LLC) to its members on a