[8-K] Rackspace Technology, Inc. Reports Material Event

Rhea-AI Filing Summary

Rackspace Technology announced a leadership transition: Gajen Kandiah will become Chief Executive Officer effective September 3, 2025, succeeding Amar Maletira, who will serve as non-employee Vice Chairman through September 30, 2025 and then step down from the board. The board also elected Mr. Kandiah as a director on his start date. Mr. Kandiah joins with senior executive experience at Hitachi Rail, Hitachi Vantara and Cognizant.

His employment agreement provides a $1,000,000 annual salary, a target bonus of 150% of salary (pro-rated for 2025), one-time equity awards of 4,000,000 restricted stock units and 6,000,000 stock options vesting over four years, and severance and potential accelerated vesting upon certain terminations or change-in-control events.

Positive

• Experienced hire: Gajen Kandiah brings senior leadership at Hitachi and Cognizant relevant to Rackspace's business model
• Performance alignment: Compensation includes a 150% target bonus and long-term equity that tie pay to future performance
• Clear succession: Board election and transition plan provide an orderly leadership change with outgoing CEO temporarily remaining as Vice Chairman

Negative

• Potential dilution: One-time awards of 4,000,000 RSUs and 6,000,000 options are sizable and could dilute existing shareholders when vested or exercised
• High incentive cost: Combined cash and equity pay, plus severance and accelerated vesting on certain events, could increase near-term compensation expense

Insights

Financial Analyst

TL;DR: CEO appointment looks like a strategic hire with meaningful pay-for-performance incentives but introduces potential near-term dilution and compensation expense.

Mr. Kandiah brings relevant enterprise software and digital transformation leadership from Hitachi and Cognizant, which aligns with Rackspace's managed cloud and services focus. The compensation package mixes cash and substantial equity: a $1.0M base and 150% target bonus emphasize performance pay, while 10,000,000 total long-term awards (4M RSUs and 6M options) create heavy equity-based alignment with shareholders but could be dilutive when recognized. Severance and change-in-control protections are typical for CEO hires and condition eligibility on a release, limiting some immediate downside. Overall, the move is neither clearly value-accretive nor value-destructive absent execution and future results.

Corporate Governance Expert

TL;DR: Governance actions are standard: board appointment, director election, and typical executive protections and incentives.

The board promptly elected the incoming CEO as a director, which centralizes executive leadership and board oversight. Employment terms disclose standard elements: base pay, a high relative bonus target, multi-year equity vesting, and severance with release conditions. The disclosure states no related-party transactions or family relationships, reducing immediate governance concerns. Material governance considerations going forward include equity dilution from the large award and the timing of any accelerated vesting tied to specific termination or change-in-control events.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 30, 2025

RACKSPACE TECHNOLOGY, INC.

(Exact name of registrant as specified in its charter)

Delaware

001-39420

81-3369925

(State of Incorporation)

(Commission File Number)

(I.R.S. Employer Identification No.)

19122 US Highway 281N, Suite 128

San Antonio, Texas 78258

(Address of principal executive offices, including zip code)

1-800-961-4454

(Registrant's telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.01 per share

RXT

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Executive Transition

On September 2, 2025, Rackspace Technology, Inc. (the “Company” or “Rackspace”) announced that its board of directors (the “Board”) has appointed Gajen Kandiah as Chief Executive Officer (“CEO”) of the Company, effective September 3, 2025. Mr. Kandiah will succeed Amar Maletira, whose employment with the Company will end on September 3, 2025. Thereafter, Mr. Maletira will serve as non-employee Vice Chairman of the Board until September 30, 2025, at which point he will step down from the Board. The Board also elected Mr. Kandiah as a director of the Board upon his commencement of employment.

Mr. Kandiah, age 58, spent over 4 years with Hitachi Rail as President and Chief Operating Officer of Hitachi Digital from February 2023 through April 2025, Executive Chairman of Hitachi Digital Services from October 2023 through April 2025, Chairman of Hitachi Cyber from January 2024 through April 2025, Chief Executive Officer of Hitachi Vantara from July 2020 through October 2023, and various other roles related to the orchestration of the collective domain expertise and digital capabilities of group companies of Hitachi Rail, including Hitachi Digital Services, Hitachi Vantara and GlobalLogic. Prior to Hitachi Rail, Mr. Kandiah spent over 15 years with Cognizant, where he held various roles, including as President, Digital Business & Engineering, from October 2015 through June 2019. In addition, Mr. Kandiah also serves on multiple private company boards.

Except as otherwise disclosed in this current report, there are no arrangements or understandings between Mr. Kandiah, on the one hand, and any other person, on the other hand, pursuant to which Mr. Kandiah was selected as an officer of the Company. Additionally, there are no family relationships between Mr. Kandiah and any director, executive officer or nominees thereof of the Company. There are no related party transactions between the Company and Mr. Kandiah that would require disclosure under Item 404(a) of Regulation S-K.

Employment Agreement

In connection with his appointment as CEO, the Company has entered into an employment agreement (the “Employment Agreement”) with Mr. Kandiah setting forth the terms of his employment and compensation. Pursuant to the Employment Agreement, Mr. Kandiah will receive an annual salary of $1,000,000 and be eligible for a bonus with a target of 150% of salary, with a pro-rated target amount paid for 2025. Mr. Kandiah will also be granted one-time equity awards, consisting of 4,000,000 restricted stock units and 6,000,000 stock options, each vesting over 4 years.

The Employment Agreement also provides that in the event Mr. Kandiah’s employment is terminated by Rackspace without “Cause” or he voluntarily resigns for “Good Reason” (each as defined in the Employment Agreement), and he signs and does not revoke a release, Mr. Kandiah will be eligible for severance benefits, including payments of a multiple of salary and target bonus (with the multiple ranging between one and two depending on the timing and whether in connection with a change in control) and potential accelerated vesting of certain equity awards (depending on the timing and whether in connection with a change in control).

The summary of the Employment Agreement is not complete and is qualified in its entirety by the Employment Agreement, a copy of which is attached hereto as Exhibit 10.1 and is incorporated by reference herein.

Item 7.01.    Regulation FD Disclosure.

On September 2, 2025, the Company issued a press release announcing the foregoing transition. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated into this Item 7.01 by reference.

The information in this Current Report on Form 8-K is being “furnished” pursuant to Item 7.01 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, and is not incorporated by reference into any Company filing, whether

made before or after the date hereof, except as shall be expressly set forth by specific reference in such filing and regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number

Exhibit Description

10.1

Employment Agreement by and between Rackspace Technology, Inc. and Gajen Kandiah, dated August 30, 2025.

99.1

Press Release dated September 2, 2025.

104

Cover Page Interactive Data File (formatted as Inline XBRL)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

RACKSPACE TECHNOLOGY, INC.

Date:

September 2, 2025

By:

/s/ Michael Bross

Michael Bross

Senior Vice President, Chief Legal Officer and Corporate Secretary

FAQ

Who is the new CEO of Rackspace (RXT)?

Gajen Kandiah will become CEO effective September 3, 2025 and was elected to the board on his start date.

What is the new CEO's base salary and bonus target?

$1,000,000 base salary with a bonus target of 150% of salary, pro-rated for 2025.

What equity awards did the company grant to the incoming CEO?

A one-time award of 4,000,000 restricted stock units and 6,000,000 stock options, each vesting over four years.

Will the outgoing CEO remain with Rackspace?

Yes. Amar Maletira will serve as non-employee Vice Chairman through September 30, 2025 and then will step down from the board.

Are there any related-party transactions between Rackspace and the new CEO?

The filing discloses no related-party transactions requiring disclosure under applicable rules.