KRATOS DEFENSE SECURITY SOLUTIONS INC

(a)On December 15, 2023, the Company entered into a new employment agreement effective January 1, 2024 (the “Fendley Agreement”) with Steven Fendley to continue to serve as President of the Company’s Unmanned Systems Division through December 31, 2026. The Fendley Agreement provides the following principal terms: (i) a base salary of $400,000; (ii) an opportunity to earn annual incentive compensation in an amount determined at the Company’s discretion; (iii) an opportunity to earn equity incentive grants at the discretion of the Company’s President and Compensation Committee of the Board of Directors; (iv) an opportunity to participate in the Company’s employee benefit plans that are generally made available to the Company’s employees, including but not limited to insurance programs; (v) payment of severance in the event of a termination of employment under certain circumstances and subject to Mr. Fendley’s execution of a customary release of claims agreement; and (v) confidentiality, non-interference, and non-disparagement provisions, which apply during the employee’s employment and for a certain restricted period after termination of employment.

On December 16, 2022, the Company entered into a new employment agreement effective January 1, 2023 (the “Carrai Agreement”) with Phillip Carrai to continue to serve as President of the Company’s Space Training & Cyber Division through December 31, 2025. The Carrai Agreement provides the following principal terms: (i) a base salary of $450,000; (ii) an opportunity to earn annual incentive compensation in an amount determined at the Company’s discretion; (iii) an opportunity to earn equity incentive grants at the discretion of the Company’s President and Compensation Committee of the Board of Directors; (iv) an opportunity to participate in the Company’s employee benefit plans that are generally made available to the Company’s employees, including but not limited to insurance programs; (v) payment of severance in the event of a termination of employment under certain circumstances and subject to Mr. Carrai’s execution of a customary release of claims agreement; and (v) confidentiality, non-interference, and non-disparagement provisions, which apply during the employee’s employment and for a certain restricted period after termination of employment.

The foregoing description is qualified in its entirety by the Fendley Agreement and Carrai Agreement attached as Exhibits 10.22 and 10.23, respectively, to this Annual Report on Form 10-K.

(b) Rule 10b5-1 Trading Plans

During the fiscal quarter ended December 31, 2023, none of our directors or officers (as defined in Rule 16a-1 under the Exchange Act) adopted, modified or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 105b-1 trading arrangement" (as those terms are defined in Item 408 of Regulation S-K), except as described in the table below:

(1)Denotes whether the trading arrangement is intended to satisfy the affirmative defense of Rule 10b5-1(c).

(2 Complied with the then-applicable requirements of Rule 10b5-1(c) when adopted in September 2022.

(3)This number represents the maximum number of shares of our common stock that may be sold pursuant to the trading arrangement. The number of shares actually sold will depend on the satisfaction of certain conditions set forth in the trading arrangement.