GARCIA ERNEST C. II 4

What Happened

• Ernest C. Garcia II, a 10% owner of Carvana (through ECG II SPE, LLC or "E‑SPE"), sold (wrote) 4,000,000 European-style covered call options on May 1, 2026 in two tranches of 2,000,000 each (exercise prices $450 and $500), receiving a cash premium of $68.0575 per option (total ≈ $272,230,000; each 2M tranche ≈ $136,115,000). Separately, 4,000,000 previously sold covered calls expired unexercised on April 17, 2026 (no proceeds on expiration).

Key Details

• Transaction dates & prices:
  • Apr 17, 2026: Expiration of 4,000,000 short derivative positions (previous covered calls) — expired out of the money, $0.
  • May 1, 2026: Sold 2,000,000 covered calls @ $68.0575 (reported as $68.06) — proceeds ≈ $136,115,000 (twice, total ≈ $272,230,000).
  • New covered calls expire May 21, 2027; strikes: $450 (2M) and $500 (2M).
• Shares owned after transaction: not specified in this filing.
• Filers & control: The options were sold by E‑SPE, an entity wholly owned and controlled by Mr. Garcia (F1).
• Collateral/pledge: E‑SPE pledged 4,000,000 Class B shares and 5,000,000 Carvana Group LLC Class A units to secure obligations; E‑SPE retains voting and dispositive power subject to the pledge (F5).
• Filing notes: This Form 4 was filed voluntarily and reports the expiration in advance of what otherwise could appear on Form 5 (F2). The filing appears timely (reporting period 2026-05-01; filed 2026-05-01).

Context

• These entries reflect derivative activity (writing covered calls), not direct open-market sales of common stock. E‑SPE received substantial cash premiums now but can be obligated to sell underlying shares if the options are exercised at the strike prices before/at expiration. For retail investors, covered-call writing is an income strategy that limits upside above the strikes; as a 10% owner, Mr. Garcia is acting through an entity he controls rather than making a standard executive open‑market trade.