KRATOS DEFENSE & SECURITY SOLUTIONS, INC. — Director's Dealing 2016

Jan 5, 2016

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: KRATOS DEFENSE & SECURITY SOLUTIONS, INC. (KTOS)
CIK: 0001069258
Period of Report: 2016-01-03

Reporting Person: Carrai Phillip D (President, TTS Division)

Non-Derivative Transactions

Date	Security	Code	Shares	Price	A/D	Holdings After	Ownership
2016-01-03	Common Stock	M	15000	—	Acquired	80870	Direct

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2016-01-03	Restricted Stock Units	$	M	15000	Disposed		Common Stock (15000)	Direct
2016-01-04	Restricted Stock Units	$	A	80000	Acquired		Common Stock (80000)	Direct

Holdings (Non-Derivative)

Security	Shares	Ownership
Common Stock	23394	Indirect

Footnotes

F1: Common Stock issued to reporting person pursuant to settlement of vested shares under Restricted Stock Unit (RSU) granted on January 3, 2011, which vest 100% on the five year anniversary of the date of grant, unless earlier vested pursuant to the terms of the RSU agreement.

F2: 40,000 RSUs vest 100% on the five year anniversary of the date of grant, unless earlier vested or terminated pursuant to the terms of the RSU agreement. The other 40,000 RSUs vest 20% upon each 10% increase in the closing market price of the Issuer's common stock measured from the RSU grant date through the 10-year anniversary of the RSU grant date, unless earlier vested or terminated pursuant to the terms of the RSU agreement.

F3: Each RSU represents a contingent right to receive one share of Issuer's common stock.

F4: Includes 11,277 shares purchased through Issuer's Employee Stock Purchase Plan and 11,820 shares held in Issuer's 401(k) Plan.