Ernest C. Garcia II Enters Covered Call Transaction on 10M Carvana ($CVNA) Shares

Executive Summary

On November 3, 2026, Ernest C. Garcia II, together with affiliated special purpose vehicles ECG II SPE, LLC ("E-SPE") and ECG II SPE II, LLC ("E-SPE II"), filed Amendment No. 40 to Schedule 13D for Carvana Co. (CVNA). The filing discloses a significant derivative transaction entered into on October 30, 2026, wherein E-SPE II wrote covered call options on 10,000,000 shares of Carvana Class A common stock to Citibank, N.A.

Key Transaction Details

• Counterparty: Citibank, N.A.
• Option Structure: European-style covered call options exercisable only on November 19, 2027.
• Underlying Shares: 10,000,000 shares of Class A Common Stock.
• Strike Price: $90.00 per share.
• Settlement Terms: Physical settlement only (cash settlement is not permitted).
• Collateral & Pledge: E-SPE II pledged Paired Interests consisting of 12,500,000 Class A Units of Carvana Group, LLC and 10,000,000 shares of Class B Common Stock to Citibank under a Security and Control Agreement.
• Guarantee: Ernest C. Garcia II provided a personal guarantee in favor of Citibank covering specific recourse events.
• Voting and Dispositive Rights: Mr. Garcia retains voting rights as well as investment and dispositive power over the pledged securities during the pendency of the options, subject to default conditions.

Beneficial Ownership Summary

Following the transaction, Ernest C. Garcia II beneficially owns an aggregate of 212,211,585 shares on an as-converted basis, representing 22.7% of the outstanding Class A common stock (based on 722,713,745 Class A shares outstanding as of October 26, 2026).

• Ernest C. Garcia II (Direct & Controlled Entities): 212,211,585 shares (22.7%)
• ECG II SPE, LLC: 20,000,000 shares (2.7%)
• ECG II SPE II, LLC: 20,000,000 shares (2.7%)

Market Implications

This transaction effectively sets a potential exit or share monetization mechanism for 10 million shares at a valuation of $90.00 per share by late 2027 while generating option premium income today. Because it involves 10,000,000 shares (~1.4% of total outstanding shares on an as-converted basis) and substantial collateral pledges by the controlling shareholder, this transaction carries high market significance.