Dream Finders Homes Inc

The proposal asks shareholders to cast a non-binding advisory vote to approve the Company’s 2025 executive compensation as disclosed in the proxy statement. Management is seeking this advisory approval as a matter of good corporate governance and to obtain feedback on pay practices; the Compensation Committee will consider the outcome when setting future compensation. Context: the company pays a mix of base salary, short-term cash incentives tied largely to adjusted pre-tax income and other performance metrics, and long-term time-vested restricted stock units to align executives with shareholder interests. The board recommends a vote FOR, noting that the program emphasizes at-risk pay, multi-year vesting, stock ownership guidelines and clawback policies. The likely rationale for the recommendation is that the Company’s pay programs are designed to motivate and retain executives, align with strategic objectives, and are supported by independent compensation consultants and favorable advisory vote results in 2025.

This management proposal seeks shareholder approval to convert the company’s state of incorporation from Delaware to Texas, adopting a Plan of Conversion and new Texas charter and bylaws. The Board—acting on a Special Committee’s review—recommends FOR approval, arguing Texas’ recent statutory reforms (including codification of the business judgment rule and establishment of a Business Court) provide greater statutory clarity, potential litigation predictability, and other governance features attractive to the company. Management also highlights potential cost savings (elimination of Delaware franchise tax), alignment with the company’s substantial Texas operations, and minimal operational impact (no change to business, management, employees, or listing). The proxy details differences between Delaware and Texas law that could affect shareholder rights (books-and-records inspection thresholds, derivative suit ownership thresholds, forum selection clauses, limitations on class voting, advancement and indemnification procedures), and notes litigation challenging aspects of Texas law and the relative lack of Texas case law interpreting recent TBOC amendments. The Board’s rationale is that the benefits (statutory clarity, business-friendly environment and cost savings) outweigh risks (less Delaware precedent, litigation uncertainty, potential criticism from proxy advisors). The proposal requires a majority of voting power. The recommendation reflects the Board’s view that reincorporation to Texas is in shareholders’ best interests, while acknowledging possible trade-offs in stockholder rights and litigation landscape.

This management proposal asks shareholders to approve the potential conversion mechanism for the Company’s Series A Convertible Preferred Stock—specifically the conversion terms that could result in issuance of Class A shares at a discount and potentially exceed NYSE thresholds that trigger shareholder approval. Management needs approval under NYSE rules because the conversion formula (90-trading-day trailing average less 20%, subject to a $4.00 floor) could result in more than 19.99% of Class A shares issued at a discount or effect a change in control. The Company says it intends to redeem the preferred before conversion but must nonetheless obtain approval to comply with covenants and avoid covenant breaches. The Board recommends FOR, arguing approval preserves flexibility to honor contractual conversion rights and avoid breaches that could accelerate conversion or require repeated shareholder votes. The proxy notes the vote is required to satisfy NYSE rules (Rules 312.03(c) and (d)), not to change the conversion terms, and explains the potential issuance mechanics, the Company’s plan to redeem the preferred, and the consequences if approval is not obtained (including repeated votes every six months). The recommendation reflects a governance and compliance rationale—ensuring the Company can comply with obligations to preferred holders while meeting NYSE requirements and retaining flexibility to manage capitalization.