CARVANA CO.

The Compensation and Nominating Committee believes that stock-based performance compensation is essential to align the interests of Carvana’s management and its stockholders in enhancing the long-term value of our equity and to encourage executives to remain with the Company. Due to the Compensation and Nominating Committee's focus on long-term growth, the majority of executive compensation is tied to long-term stock price. This structure is reviewed by the Compensation and Nominating Committee annually and may change in the future. Among the varied types of equity awards the Compensation and Nominating Committee is authorized to use under the equity plan, the Compensation and Nominating Committee determined to use time-based RSU grants for the purpose of retention and performance recognition. The Compensation and Nominating Committee determined that time-based RSUs were the most appropriate form of equity compensation for 2025 in light of current market conditions and the Company’s strategic priorities. This approach provides a straightforward and effective means of incentivizing and retaining key executives and directly ties the value of executive compensation to the performance of the Company’s stock over time, ensuring alignment with stockholder interests.