SCHEDULE: Zalupski Retains Majority Stake in Dream Finders Homes

Patrick O. Zalupski maintains a 64.3% beneficial ownership in Dream Finders Homes, Inc., including shares pledged under forward sale contracts.

Summary

• Patrick O. Zalupski beneficially owns 59,746,508 shares of Dream Finders Homes, Inc. Class A Common Stock, representing 64.3% of the class.
• This ownership includes 57,726,153 shares of Class B Common Stock, which are convertible into Class A Common Stock on a one-for-one basis.
• The total beneficial ownership is calculated assuming the conversion of all Class B shares and is based on 35,155,531 Class A shares outstanding as of July 25, 2025.
• Mr. Zalupski entered into prepaid variable forward sale contracts on August 14, 2024, December 5, 2024, and June 5, 2025, pledging an aggregate of 3,000,000 Class B shares as security.
• Under these contracts, Mr. Zalupski retained dividend and voting rights for the pledged shares.
• He received aggregate upfront cash payments of approximately $46.4 million from these forward contracts.
• The contracts obligate Mr. Zalupski to deliver shares or an equivalent amount of cash on future settlement dates, determined by the Class A Common Stock's volume-weighted average price relative to specified Floor and Cap Prices.

Sentiment

Score: 6

Explanation: The filing is primarily factual regarding beneficial ownership. The high insider ownership is generally positive, indicating strong alignment. However, the pledging of a significant number of shares introduces a degree of personal financial risk for the executive, which could indirectly impact the company.

Positives

• Patrick O. Zalupski's substantial 64.3% beneficial ownership demonstrates significant insider commitment and alignment with shareholder interests.
• The forward sale contracts provided Mr. Zalupski with approximately $46.4 million in upfront cash, offering personal liquidity while retaining voting and dividend rights on the pledged shares during the contract term.

Negatives

• A significant portion of Mr. Zalupski's shares (3,000,000 Class B shares) are pledged under prepaid variable forward sale contracts, which could expose him to margin calls or forced sales under certain market conditions.

Risks

• Pledging of 3,000,000 Class B shares under forward sale contracts creates a potential risk of forced share delivery or cash settlement, depending on future stock price performance.
• The terms of the forward contracts involve complex settlement mechanisms tied to Class A Common Stock prices, which could result in Mr. Zalupski delivering a varying number of shares or cash, potentially impacting his ownership percentage or liquidity.
• While Mr. Zalupski retains voting rights on pledged shares, a significant decline in stock price could trigger obligations under the contracts that might necessitate further personal financial actions.

Future Outlook

Future obligations under the prepaid variable forward sale contracts will be settled between August 2027 and April 2029, with the number of shares or cash delivered dependent on the Class A Common Stock's price relative to specified Floor and Cap Prices at the time of settlement.

Industry Context

Dream Finders Homes operates in the homebuilding industry. The filing highlights significant insider ownership, a common characteristic among founder-led companies, which can be viewed as a strong indicator of management's long-term commitment to the company's success.

Comparison to Industry Standards

• This filing primarily details beneficial ownership and personal financial arrangements of a key executive, rather than operational or financial performance. Therefore, direct comparisons to industry-standard operational results or project benchmarks are not applicable.
• High insider ownership, as demonstrated by Mr. Zalupski's 64.3% stake, is a common characteristic of founder-led companies in the homebuilding sector, often viewed as a sign of strong alignment between management and shareholder interests.

Stakeholder Impact

• Shareholders may view the high beneficial ownership by Patrick O. Zalupski as a positive indicator of long-term commitment and confidence in the company's future.
• The pledging of shares under forward contracts could be perceived as a liquidity event for the executive, but also introduces a potential risk if stock prices decline significantly, though voting and dividend rights are retained.

Next Steps

• Settlement of the prepaid variable forward sale contracts will occur based on valuation periods between August 2027 and April 2029.

Key Dates

Keywords

Dream Finders Homes, Patrick Zalupski, Beneficial Ownership, Class A Common Stock, Class B Common Stock, SEC Filing, Schedule 13G, Insider Ownership, Homebuilder, Forward Sale Contracts, Pledged Shares