Form 4: Telos CFO Gary Bendza Granted Significant Performance-Based RSUs Tied to Shareholder Return

Telos Corporation's Executive Vice President and Chief Financial Officer, Gary Mark Bendza, has been granted 380,373 performance-based Restricted Stock Units (RSUs) with vesting contingent on the company's Total Shareholder Return relative to peers through May 2028.

Summary

• Gary Mark Bendza, EVP and CFO of Telos Corporation (TLS), was granted 380,373 performance-based Restricted Stock Units (RSUs) on June 11, 2025.
• Each RSU represents a contingent right to receive one share of Telos common stock.
• The vesting of these RSUs is tied to Telos's common stock achieving a specific Total Shareholder Return (TSR) relative to a defined group of peer companies.
• The performance period for these RSUs spans from June 1, 2025, through May 31, 2028.
• Following this transaction, Mr. Bendza directly beneficially owns 693,808 shares of common stock and 380,373 performance-based RSUs.
• Additionally, Mr. Bendza indirectly beneficially owns 8,482.77 shares of common stock through a 401k plan.

Sentiment

Score: 7

Explanation: The document reports a standard executive compensation grant, which is generally positive as it aligns management incentives with shareholder value. The performance-based nature of the RSUs is a strong positive, though the lack of specific targets or peer group details slightly limits full assessment.

Positives

• The grant of performance-based RSUs aligns the interests of the CFO directly with shareholder returns, incentivizing long-term stock performance.
• The use of Total Shareholder Return (TSR) relative to peers as a vesting condition promotes competitive performance and strategic focus.

Negatives

• The specific 'certain Total Shareholder Return' target and the 'certain of the Issuer's peers' are not disclosed, limiting transparency on the exact performance hurdles.

Risks

• The vesting of the performance-based RSUs is contingent on achieving specific Total Shareholder Return targets relative to peers, meaning the RSUs may not vest if these targets are not met, which could impact executive compensation and retention.

Future Outlook

The performance-based RSUs granted to the CFO are designed to incentivize the achievement of specific Total Shareholder Return targets relative to peers over a performance period extending from June 1, 2025, through May 31, 2028, indicating a strategic focus on long-term shareholder value creation.

Industry Context

The grant of performance-based RSUs tied to Total Shareholder Return (TSR) relative to peers is a common practice in the technology and cybersecurity sectors, aligning executive incentives with market performance and competitive positioning. This type of compensation structure is widely adopted to ensure executives are motivated to drive value that directly benefits shareholders in a competitive landscape.

Comparison to Industry Standards

• The use of performance-based RSUs with TSR as a metric is a standard practice for executive compensation in publicly traded technology companies, comparable to compensation structures seen at companies like Palo Alto Networks, CrowdStrike, or Zscaler, which often tie executive incentives to relative stock performance.
• The multi-year performance period (June 2025 May 2028) is consistent with long-term incentive plans designed to encourage sustained growth and strategic decision-making, similar to those implemented by other industry leaders to retain key talent and align interests over an extended horizon.

Management Changes

Related Party Transactions

• The grant of performance-based RSUs to the EVP, CFO is a form of executive compensation, which is a common related-party transaction between a company and its officers.

Stakeholder Impact

• Shareholders: The performance-based nature of the RSUs directly links executive compensation to Total Shareholder Return, potentially benefiting shareholders if the company's stock performs well relative to its peers.
• Employees: While not directly impacting all employees, this compensation structure for a key executive may signal the company's commitment to performance-driven incentives.
• Management: The CFO's compensation is now significantly tied to the company's long-term stock performance, providing a strong incentive to drive shareholder value.

Next Steps

• Telos Corporation's common stock performance will be monitored relative to its peers during the performance period of June 1, 2025, through May 31, 2028, to determine the vesting of the granted RSUs.

Key Dates

Keywords

Telos Corporation, TLS, SEC Form 4, Restricted Stock Units, RSUs, Performance-Based Compensation, Executive Compensation, Total Shareholder Return, TSR, Insider Trading, Officer Compensation, Corporate Governance