Defense contracting giant L3Harris Technologies ousted CEO Chris Kubasik on Sunday after learning he engaged in "certain conduct ... that was not consistent with the values of the Company," the company said in a statement on Monday.
L3Harris's board appointed Sam Mehta as CEO and president, the company said. Mehta most recently was the company's president of the Space & Mission Systems and Communications & Spectrum Dominance segments.
Shares of L3Harris fell by more than 4% on the heels of the news of Kubasik's ouster, which "was unrelated to the Company's financial reporting, controls, customer relationships or operational performance," the company's statement said.
"Following its investigation of these matters with the assistance of independent counsel, the Board determined that it would be in the best interests of the Company to enter into a separation agreement with Kubasik," the statement said.
Kubasik's ouster comes seven months after the Defense Department committed to a $1 billion convertible preferred equity investment in L3Harris' missile solutions business, which will become a separate company as part of the deal. An initial public offering for the missile business has been postponed from the latter half of 2026 until mid-2027.
L3Harris was responsible for modifying a 747 jumbo jet controversially gifted by Qatar to the United States to serve as a new Air Force One for President Donald Trump.
Kubasik, 65, in addition to being CEO, had been L3Harris' chairman of the board. He had been CEO since 2021. L3Harris on Monday said that Lewis Hay III, the company's lead independent director, was named independent chairman of the board.
CNBC has reached out to Kubasik for comment.
The news outlet Semafor, citing two people briefed on the investigation, reported that Kubasik was ousted "after an independent probe found he had engaged in an inappropriate relationship with an employee."
CNBC has asked L3Harris whether that report is accurate.
In 2012, the board of the major defense contractor Lockheed Martin asked for and received Kubasik's resignation as president and chief operating officer, weeks before he was scheduled to become CEO, after "an ethics investigation confirmed that he had a close personal relationship with a subordinate employee," Lockheed said in a statement at the time.
In a filing with the Securities and Exchange Commission that details Kubasik's separation agreement, L3Harris said that Kubasik "does not admit, and expressly disclaims, any violation of Company policy or basis for termination for 'cause,' but has determined to resolve all matters relating to the Executive's separation from employment on the terms set forth in this Agreement."
Under the separation agreement, Kubasik will not receive any bonus under the company's 2026 incentive plan but will keep nearly 384,000 stock options.
Kubasik and his wife, Jane Kubasik, are longtime supporters of the athletics program at their alma mater, the University of Maryland. The Kubasik First Impact Program helps a select cohort of Maryland student-athletes each academic year prepare for life beyond their sport.
Hay, in a statement about Mehta's elevation to CEO, said, "Sam is a proven executive who brings deep knowledge of our business, priorities and culture, making him ideally suited to become President and CEO of L3Harris at this important time in our company's and our nation's history."
"Sam's readiness to lead L3Harris reflects the Board's robust succession planning and our focus on cultivating talent," Hay said.
Mehta, in a statement, said, "I am honored by the opportunity to serve as President and CEO of L3Harris. I look forward to working even more closely with my fellow senior leaders and my talented colleagues across the Company to support the needs of our country and our allies."
"Today, L3Harris has a portfolio purpose-built for the future of warfare, and we are well-positioned to continue executing our focused growth strategy as The Trusted Disruptor," he said.
