Form 4: Kratos Executive Phillip D. Carrai Reports Stock Transactions

Phillip D. Carrai, President of the STC Division at Kratos Defense & Security Solutions, reports acquisition and disposal of common stock, including shares acquired through performance restricted stock unit settlements and sold under a 10b5-1 trading plan.

Summary

• Phillip D. Carrai, President of the STC Division at Kratos Defense & Security Solutions, filed a Form 4 detailing changes in beneficial ownership.
• On March 13, 2025, Carrai acquired a total of 66,668 shares of common stock through the settlement of performance restricted stock unit awards granted on January 3, 2020, January 4, 2021, January 3, 2022 and January 4, 2024.
• On the same day, 30,064 shares were withheld to cover tax liabilities at a price of $29.52 per share.
• On March 17, 2025, Carrai sold 6,000 shares at a weighted average price of $31.383 per share, with prices ranging from $30.71 to $31.84.
• Following these transactions, Carrai directly owns 293,897 shares of common stock and indirectly owns 46,644 shares through a trust.

Sentiment

Score: 6

Explanation: Neutral sentiment. The transactions appear to be routine, with acquisitions from stock unit settlements and sales under a pre-arranged plan. No indication of unusual activity or concern.

Positives

• The acquisition of shares through performance restricted stock unit settlements suggests Carrai's performance met certain targets.
• The execution of sales under a pre-arranged 10b5-1 trading plan indicates a structured and compliant approach to stock transactions.

Negatives

• The sale of 6,000 shares, even under a 10b5-1 plan, could be interpreted negatively by some investors, although it's a small percentage of overall holdings.

Risks

• Further sales by Carrai could put downward pressure on the stock price, although the 10b5-1 plan provides some predictability.

Future Outlook

The document does not contain specific forward-looking statements, but future transactions by Carrai may occur under the 10b5-1 trading plan.

Industry Context

Executive stock transactions are common and closely watched in the defense and security industry, as they can provide insights into management's confidence in the company's prospects. The use of 10b5-1 plans is a standard practice to avoid insider trading concerns.

Comparison to Industry Standards

• Executive compensation packages in the defense industry often include stock options and restricted stock units to align management's interests with those of shareholders.
• Companies like Lockheed Martin, Northrop Grumman, and Raytheon Technologies also utilize similar equity-based compensation strategies.
• The volume of shares traded by Carrai is relatively small compared to the overall trading volume of KTOS, suggesting it's unlikely to have a significant impact on the stock price.

Stakeholder Impact

• The transactions are unlikely to have a significant impact on shareholders, employees, customers, suppliers, or creditors, given the relatively small volume of shares traded.

Key Dates