Leonardo DRS, Inc. 8-K

What Happened

• Leonardo DRS, Inc. announced on Jan 6, 2026 (filing date) that Sally A. Wallace, age 59, has been appointed Executive Vice President, Chief Operating Officer, effective January 1, 2026. She replaces John Baylouny as COO; Baylouny was promoted to President and Chief Executive Officer effective January 1, 2026 (previously announced).
• Ms. Wallace is a defense industry veteran with more than 20 years at DRS. Her prior roles include Executive Vice President, Business Operations (since late 2016), President of the C4ISR Group (Apr 2014–Dec 2016), and other senior operational and GM roles. She holds an MBA from the University of Chicago, an M.S. in mechanical engineering from the University of Connecticut, and a B.S. in engineering physics from Grove City College.

Key Details

• Annual base salary: $540,000.
• 2026 target annual cash bonus: 70% of base salary (actual payout tied to performance objectives set and certified by the Compensation Committee).
• Target equity award under the 2022 Omnibus Equity Compensation Plan: $700,000, split 45% time‑vested RSUs and 55% performance RSUs (PRSUs).
  • RSU vesting: ratably over three years, beginning April 1, 2027, subject to continued service.
  • PRSU vesting: based on a three‑year performance period ending April 1, 2029; final payout contingent on Compensation Committee determination of performance.
• The company issued a news release about the COO succession on Jan 6, 2026; no related‑party transactions or special arrangements were reported.

Why It Matters

• This is an executive succession and continuity move: DRS elevated an internal, long‑tenured operations leader to COO as the company transitions John Baylouny into the CEO role. That indicates leadership continuity in operations and program delivery.
• Compensation mixes cash and performance‑based equity, aligning Ms. Wallace’s incentives with multi‑year operational and performance goals; payouts for PRSUs depend on committee‑certified performance metrics.
• For investors, the filing confirms management changes and the company’s approach to retaining key operational talent; there were no disclosed family relationships or other conflicts related to the appointment.