KRATOS DEFENSE & SECURITY SOLUTIONS, INC. — Director's Dealing 2010

Feb 26, 2010

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS)
CIK: 0001069258
Period of Report: 2010-02-25

Reporting Person: CARANO BANDEL L (Director)

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2010-02-25	Director Option (Right to Buy)	$12.84	A	585	Acquired	2020-02-25	Common Stock (585)	Direct

Footnotes

F1: Represents options received in lieu of cash fees from Mr. Carano's service on the Issuer's Board of Directors as approved by the Board of Directors. The grant is effective February 25, 2010.

F2: The Director Options became fully exercisable on the date of the grant.

F3: Not applicable

F4: Includes Director Option to purchase 576 shares of Common Stock, which is held by Mr. Carano on behalf of Oak Investment Partners X, Limited Partnership ("Oak X, L.P."); and Director Option to purchase 9 shares of Common Stock, which is held by Mr. Carano on behalf of Oak X Affiliates Fund, Limited Partnership ("Oak X Affiliates, L.P."). Mr. Carano is a Managing Member of Oak Associates X, L.L.C., the General Partner of Oak X, L.P. and a Managing Member of Oak X Affiliates, L.L.C., the General Partner of Oak X Affiliates, L.P.