Form 4: Cintas Director Tysoe Reports Phantom Stock Unit Acquisitions

Cintas Corp. Director Ronald W. Tysoe reported multiple acquisitions of phantom stock units as part of a deferred compensation plan.

Summary

• Ronald W. Tysoe, a Director of Cintas Corp. (CTAS), reported numerous acquisitions of Phantom Stock Units between April 2008 and January 2010.
• These units are part of the Directors' Deferred Compensation Plan, where a portion of cash retainer fees is deferred into these units.
• Each Phantom Stock Unit holds a value equivalent to one share of Cintas Corporation common stock.
• The units do not represent actual shares of common stock and do not carry any voting rights.
• Phantom Stock Units are only payable in cash after the director's termination of service.
• Cintas Corporation completed a four-for-one stock split of its common stock on September 4, 2024, and all reported share amounts and stock prices in this filing have been adjusted to reflect this split.
• This Form 4 is the first of five filings by Mr. Tysoe on December 17, 2025, necessitated by the SEC's EDGAR system limit of 30 transactions per single Form 4.

Sentiment

Score: 5

Explanation: The filing is a routine disclosure of insider transactions related to a deferred compensation plan and a past stock split, containing no inherently positive or negative operational or financial news.

Positives

• Director Ronald W. Tysoe is increasing his beneficial ownership in Cintas Corp. through the accumulation of Phantom Stock Units, which aligns his financial interests with those of shareholders.
• The existence of a Directors' Deferred Compensation Plan demonstrates a structured approach to executive compensation and retention, potentially fostering long-term commitment.

Negatives

• Phantom Stock Units do not confer actual ownership of common stock or voting rights, limiting the director's direct influence on corporate decisions through these holdings.
• The units are only payable in cash upon termination of service, which restricts immediate liquidity and direct equity participation during active service.

Risks

• The value of the Phantom Stock Units is directly tied to the market performance of Cintas Corporation's common stock, exposing the director to market fluctuations and potential value depreciation.
• As these units are not actual shares, the director does not possess voting rights associated with these holdings, which limits direct influence on corporate governance through this specific form of compensation.

Future Outlook

This Form 4 does not contain explicit forward-looking statements or guidance regarding the company's future performance or strategic direction.

Management Comments

• Reporting Person elected to defer a portion of the Reporting Person's cash retainer fees into Phantom Stock Units pursuant to the Directors' Deferred Compensation Plan (including dividend equivalents that have been credited as additional Phantom Stock Units), each unit having a value equal to one share of Cintas Corporation common stock but are not actual shares of common stock and carry no voting rights. Phantom Stock Units are payable only in cash after termination of service as a director.
• On September 4, 2024, Cintas Corporation completed a four-for-one stock split of its common stock. All share amounts and stock prices have been adjusted to give effect to this stock split.

Industry Context

Form 4 filings are routine disclosures for reporting insider transactions, and deferred compensation plans for directors are a common practice across publicly traded companies to align management interests with long-term shareholder value. The stock split is a corporate action often undertaken to improve share liquidity and accessibility.

Comparison to Industry Standards

• The use of phantom stock units as a component of director compensation is a common practice among public companies, similar to plans at many S&P 500 firms, which aim to align director incentives with long-term shareholder value without immediate equity dilution or voting rights.
• The four-for-one stock split by Cintas Corporation is a standard corporate action, comparable to splits undertaken by companies like Apple Inc. or Tesla, Inc. in the past, typically intended to make shares more affordable and increase trading liquidity.

Corporate Governance

Related Party Transactions

• The acquisition of Phantom Stock Units by Director Ronald W. Tysoe under the Directors' Deferred Compensation Plan represents a compensation arrangement between the company and a related party (director).

Stakeholder Impact

• Shareholders: The four-for-one stock split on September 4, 2024, affects all shareholders by increasing the number of shares outstanding and proportionally decreasing the share price, potentially improving liquidity. The phantom stock units do not dilute voting power.
• Director (Ronald W. Tysoe): Benefits from a deferred compensation vehicle that ties his long-term financial interest to the company's stock performance, with payment upon termination of service.

Next Steps

• Phantom Stock Units will be payable in cash to Ronald W. Tysoe after his termination of service as a director.

Key Dates

Keywords

Cintas, CTAS, Form 4, Insider Transaction, Phantom Stock Units, Deferred Compensation, Director Compensation, Stock Split