Cognizant (CTSH) Director Files Form 4 Disclosing Dividend-Equivalent RSUs
Rhea-AI Filing Summary
Reporting person: Leo S. Mackay Jr., a director of Cognizant Technology Solutions Corp. (CTSH), filed a Form 4 disclosing receipt of restricted stock units on 08/26/2025.
The filing shows three grants of units arising from dividend equivalent accruals: 4,652.0391 deferred restricted stock units (fully vested and payable upon termination of board service), 3,432.08 restricted stock units (fully vested and deferred for settlement under the companys Non-Employee Director Compensation Guidelines), and 2,875.3818 restricted stock units (contingent units that will vest in full on June 3, 2026 and are electively deferred for settlement).
Positive
- Receipt of equity units increases the reporting persons stake via restricted stock units tied to the companys Class A common stock
- Deferral elections for settlement align compensation with long-term ownership and typically support alignment with shareholder interests
- One tranche vests on June 3, 2026, providing a clear retention schedule
Negative
- None.
Insights
TL;DR: Routine director equity accruals disclosed; deferral elections align with standard non-employee director compensation practices.
The Form 4 documents equity-based compensation credited to a sitting director via dividend equivalent rights on previously outstanding units. Two sets of units are fully vested but are subject to the reporting persons election to defer settlement under the companys Non-Employee Director Compensation Guidelines, which is a common governance mechanism to align compensation with long-term ownership and reduce immediate dilution. One tranche remains unvested until June 3, 2026, preserving retention incentives. No cash transactions or disposals are reported.
TL;DR: Grants reflect dividend-equivalent accruals rather than new cash awards; settlement timing choices may affect reported beneficial ownership timing.
The filing specifies dividend-equivalent restricted stock unit accruals converted into three unit grants. The deferred units are described as fully vested but will be settled only upon termination of board service or other specified events if the reporting person elected deferral, limiting immediate share issuance. The contingent units vesting on June 3, 2026 provide a clear future vesting date and retention link. The disclosure lacks dollar valuations beyond unit counts and shows no sales or purchases of shares for cash.
Insider Trade Summary
| Type | Security | Shares | Price | Value |
|---|---|---|---|---|
| Grant/Award | Deferred Restricted Stock Units | 20.033 | $0.00 | -- |
| Grant/Award | Restricted Stock Units | 14.779 | $0.00 | -- |
| Grant/Award | Restricted Stock Units | 12.382 | $0.00 | -- |
Footnotes (1)
- Reflects deferred restricted stock units received pursuant to dividend equivalent rights accrued on previously outstanding deferred restricted stock units. Each deferred restricted stock unit represents a right to receive one share of Class A Common Stock of the Company. The deferred restricted stock units are fully vested and will be settled upon the Reporting Person's termination of service from the Board. Reflects restricted stock units received pursuant to dividend equivalent rights accrued on previously outstanding restricted stock units. Each restricted stock unit represents a right to receive one share of Class A Common Stock of the Company. The restricted stock units are fully vested. The Reporting Person has elected, pursuant to the Company's Non-Employee Director Compensation Guidelines (the "Guidelines"), to defer settlement of such restricted stock units until the first to occur of (1) a change in control, (2) the death or permanent disability of the Reporting Person, or (3) the first July 1 following the date of the Reporting Person's termination of service (other than due to death or permanent disability). Reflects restricted stock units received pursuant to dividend equivalent rights accrued on previously outstanding restricted stock units. Each restricted stock unit represents a contingent right to receive one share of the Company's Class A Common Stock. The restricted stock units will vest fully on June 3, 2026. The Reporting Person has elected, pursuant to the Company's Guidelines, to defer settlement of such restricted stock units until the first to occur of (1) a change in control, (2) the death or permanent disability of the Reporting Person, or (3) the first July 1 following the date of the Reporting Person's termination of service (other than due to death or permanent disability).
