UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

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RealPage, Inc.

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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REALPAGE, INC.

Notice of 2020 Annual Meeting of Stockholders

June 3, 2020

We are pleased to invite you to attend the 2020 Annual Meeting of Stockholders of RealPage, Inc.

When and Where: The meeting will be held via live webcast by visiting the following website: www.meetingcenter.io/289622160 on June 3, 2020, at 10:00 a.m., Central time. You will need the control number and password included on your proxy card or voting instruction form that you received with your proxy materials in order to access the meeting, to vote your shares or submit questions during the meeting. Instructions on how to connect to the meeting and participate via the Internet, including how to demonstrate proof of stock ownership, are listed on your proxy card.

Items of Business: The meeting is being held to conduct the following items of business which are described in greater detail in the Proxy Statement accompanying this notice:

 

1.

To elect each of Alfred R Berkeley, III, Peter Gyenes, and Charles F. Kane to our board of directors for a term of three years.

 

2.

To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2020.

 

3.

To approve an advisory (non-binding) proposal concerning our executive compensation program.

 

4.

To approve the RealPage, Inc. 2020 Equity Incentive Plan.

 

5.

To transact such other business as may properly come before the meeting or any adjournment thereof.

Record Date: Our board of directors set April 9, 2020 as the record date for the meeting. Our stockholders of record at the close of business on that date are entitled to receive this notice and to vote at the meeting.

Meeting Attendance and Voting: Whether or not you plan to attend the annual meeting via live webcast, we hope that you will vote as soon as possible. Voting by written proxy will ensure your representation at the meeting. For specific instructions on how to vote your shares, please review the instructions on the proxy card. Stockholders who attend the meeting may vote at the annual meeting even if they have submitted a proxy. However, if you have submitted a proxy and wish to vote electronically at the meeting, you must notify the inspector of elections of your intention to revoke the proxy that you previously submitted and instead vote in person at the meeting. Under Delaware law, attendance at the annual meeting via live webcast is deemed “present in person.” If your shares are held in the name of a broker, trustee, bank or other nominee, please coordinate with your broker, trustee, bank or other nominee to determine how to vote your shares.

Additional Information: The 2020 Proxy Statement and 2019 Annual Report to Stockholders are included with this notice and are also available at https://investor.realpage.com.

 

By Order of the Board of Directors

David G. Monk

Executive Vice President, Chief Legal Officer and Secretary

Richardson, Texas

April 29, 2020

REALPAGE, INC.

Proxy Statement

For the

2020 Annual Meeting of Stockholders

TABLE OF CONTENTS

 

PROXY STATEMENT		1
GOVERNANCE		2
•  Proposal One — Election of Directors		2
•  Board Composition		2
•  Required Vote		2
•  Recommendation of our Board for Proposal One		2
•  2020 Director Nominees — Class I Directors		2
•  Incumbent Directors whose terms of office continue after the Annual Meeting		5
•  Board and Committee Governance		7
•  Board Leadership Structure		7
•  Director Qualifications		7
•  Director Independence		9
•  Board and Committee Meetings and Attendance		9
•  Board Committees		9
•  Board Oversight of Risk		12
•  Communication with our Board		12
•  Additional Governance Information		13
•  Articles and Bylaws		13
•  Code of Business Conduct and Ethics		13
•  Corporate Governance Guidelines		13
•  Director Minimum Stock Ownership Requirements		13
•  Hedging, Short Sale and Pledging Policy under our Insider Trading Policy		14
•  Director Attendance at Annual Meetings of Stockholders		14
•  Director Compensation		14
•  Determining Compensation for Non-Employee Directors in 2019		14
•  Discussion of Director Compensation		14
•  Director Compensation Table for Year ended December 31, 2019		15
•  Transactions With Related Persons, Promoters And Certain Control Persons		16
•  Stock Options and Restricted Stock		16
•  Employment Arrangements and Indemnification Agreements		16
•  Other Relationships		16
•  Policies and Procedures for Related Party Transactions		16
•  Limitations of Liability and Indemnification Matters		17
SECURITY OWNERSHIP		18
•  Ownership of Equity Securities of RealPage		18
EXECUTIVE OFFICERS		20
EXECUTIVE COMPENSATION		23
•  Compensation Discussion and Analysis		23
•  Compensation Philosophy and Objectives		23
•  Compensation Decision-Making Process		24
•  Competitive Positioning		25
•  2019 Elements of Executive Compensation		26
•  Base Salaries		27
•  Performance-Based Cash Bonuses		27

REALPAGE, INC.

2201 Lakeside Boulevard

Richardson, Texas 75082

(972) 820-3000

PROXY STATEMENT

FOR THE

2020 ANNUAL MEETING OF STOCKHOLDERS

April 29, 2020

We are furnishing you this proxy statement and proxy card to solicit proxies on behalf of the board of directors (the “Board”) of RealPage, Inc. (“RealPage”, the “Company”, “we” or “us”) to be voted at our 2020 Annual Meeting of Stockholders (“Annual Meeting”). Due to the possible public health impact of the coronavirus (COVID-19) and to support the well-being of our employees and stockholders, please note that the Annual Meeting will be held via live webcast at www.meetingcenter.io/289622160 on June 3, 2020, at 10:00 a.m., Central time. You will need the control number and password included on your proxy card or voting instruction form that you received with your proxy materials in order to access the meeting, to vote your shares or submit questions during the Annual Meeting. Instructions on how to connect to the Annual Meeting and participate via the Internet, including how to demonstrate proof of stock ownership, are listed on your proxy card. The proxies also may be voted at any adjournments or postponements of the Annual Meeting.

We are first mailing the proxy materials to stockholders on April 29, 2020. Please refer to “Information Concerning Solicitation and Voting” located on page 67 in this proxy statement for information relating to the distribution of our annual meeting materials to our stockholders.

All properly executed written proxies and all properly completed proxies submitted by telephone or Internet that are delivered pursuant to this solicitation will be voted at the Annual Meeting in accordance with the directions given in the proxy, unless the proxy is revoked prior to completion of voting at the Annual Meeting.

Only owners of record of shares of our common stock as of the close of business on April 9, 2020 (the “Record Date”) are entitled to notice of, and to vote at, the Annual Meeting or any adjournments or postponements of the Annual Meeting. Each owner of record on the Record Date is entitled to one vote for each share of common stock held. On the Record Date, 96,243,953 shares of our common stock, $0.001 par value, were issued, outstanding and entitled to vote at the Annual Meeting.

The Notice of Annual Meeting, this Proxy Statement and our Annual Report on Form 10-K for the year ended December 31, 2019 are available at https://investor.realpage.com.

Our principal executive offices are located at 2201 Lakeside Boulevard, Richardson, Texas 75082.

 

1

GOVERNANCE

PROPOSAL ONE: ELECTION OF DIRECTORS

 

What Am I Voting On?

Stockholders are being asked to elect three director nominees for three-year terms. This section includes information about our Board, each director nominee, and each incumbent director whose term continues after the Annual Meeting.

Voting Recommendation:

FOR the election of each director nominee. We believe the combination of the various qualifications, skills and experiences of the 2020 director nominees will contribute to an effective and well-functioning Board as we believe the director nominees possess the necessary qualifications to provide effective oversight of the business and quality advice and counsel to our management.

Board Composition

Our Board is currently composed of eight members, divided into three classes with staggered three-year terms. There are currently three directors in Class I, two directors in Class II and three directors in Class III. The current terms of office of the Class I directors, Mr. Alfred R. Berkeley, III, Mr. Peter Gyenes and Mr. Charles F. Kane, will expire at this Annual Meeting and Mr. Berkeley, Mr. Gyenes and Mr. Kane will stand for re-election to our Board at the Annual Meeting.

The terms of office of the Class II directors, Mr. Scott S. Ingraham and Mr. Jeffrey T. Leeds, will expire at the 2021 annual meeting. The terms of office of the Class III directors, Ms. Dana S. Jones, Mr. Stephen T. Winn and Mr. Jason A. Wright, will expire at the 2022 annual meeting. Our certificate of incorporation and our bylaws provide that the number of directors will be fixed from time to time by a resolution of the majority of our Board. Nine directors are currently authorized.

Required Vote

Directors are elected by a plurality of the votes cast. The three nominees who receive the greatest number of votes cast will be elected directors for three-year terms, in each case until their successors are duly elected and qualified. Withheld votes and broker non-votes, if any, will not be counted either for or against the election of a director nominee. Cumulative voting is not permitted by our certificate of incorporation.

Unless otherwise instructed, the proxy holders will vote the proxies received by them for our nominees named below. If any of our nominees is unable or declines to serve as a director at the time of the Annual Meeting, the proxies will be voted for any nominee who is designated by the present Board to fill the vacancy. It is not expected that any nominee will be unable or will decline to serve as a director.

Recommendation of our Board for Proposal One

Our Board unanimously recommends that stockholders vote FOR the nominees listed below.

2020 DIRECTOR NOMINEES — CLASS I DIRECTORS

The nominating and governance committee of our Board (“Nominating and Governance Committee”) recommended the three individuals set forth in the table below for nomination by our Board. Based on such recommendations, our Board nominated such directors for election at the Annual Meeting as Class I directors to serve for a term expiring at the 2023 annual meeting of stockholders, or until their successors have been duly elected and qualified or until their earlier death, resignation or removal.

 

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Our Board and Nominating and Governance Committee believe that the combination of the various qualifications, skills and experiences of the director nominees will contribute to an effective and well-functioning Board and that, individually and as a whole, the director nominees possess the necessary qualifications to provide effective oversight of our business and quality advice and counsel to our management.

The following sets forth information concerning the nominees for election as directors at the Annual Meeting, including information as to each nominee’s age as of the Record Date, current principal occupation and business experience.

 

Name of Director		Age				Position and Offices Held with Company		Director Since
Alfred R. Berkeley, III (1)			75			Director			2003
Peter Gyenes (1)(2)(3)			74			Director			2010
Charles F. Kane (1)(2)(3)			62			Director			2012

 

(1)	Member of Compensation Committee

(2)	Member of Audit Committee

(3)	Member of Nominating and Governance Committee

Class I Directors (Terms Expire in 2020)

Alfred R. Berkeley, III has served as a member of our Board since December 2003 and as a member of our Compensation Committee since January 2004. Mr. Berkeley also served as a member and as chairman of our Audit Committee from January 2004 to February 2012 and as our lead independent director from February 2011 to February 2012. Mr. Berkeley has served as Chairman of Princeton Capital Management, Inc., an investment adviser, since December 2012 and Princeton Capital Management LLC since September 2017. Mr. Berkeley has served as Vice Chairman of Gentag, Inc., a developer of technology for near field communications, since November 2011. Mr. Berkeley served as the Chairman of Pipeline Financial Group, Inc., the parent of Pipeline Trading Systems LLC, a block trading brokerage service, from December 2003 until November 2011. From December 2003 to March 2010, Mr. Berkeley also served as the Chief Executive Officer of Pipeline Financial Group, Inc. He also served as Acting Chairman of the National Infrastructure Advisory Council for the President of the United States from 2001 until December 2011. Mr. Berkeley also served as a trustee of Johns Hopkins University and a member of the Johns Hopkins University Applied Physics Laboratory, LLC from 1999 until June 2011. He formerly served as Vice Chairman of the Nomination Evaluation Committee for the National Medal of Technology and Innovation, which makes candidate recommendations to the Secretary of Commerce. He was appointed Vice Chairman of the NASDAQ Stock Market, Inc. in July 2000, serving through July 2003, and served as President of NASDAQ from 1996 until 2000. From 1972 to 1996, Mr. Berkeley served in a number of capacities at Alex. Brown & Sons Incorporated, which was acquired by Bankers Trust New York Corporation and later by Deutsche Bank AG. Most recently, he was Managing Director in the corporate finance department where he financed computer software and electronic commerce companies. He joined Alex. Brown & Sons Incorporated as a Research Analyst in 1972 and became a general partner in 1983. From 1985 to 1987, he served as Head of Information Services for the firm. From 1988 to 1990, Mr. Berkeley took a leave of absence from Alex. Brown & Sons Incorporated to serve as President and Chief Executive Officer of Rabbit Software Inc., a public telecommunications software company. He served as a captain in the United States Air Force and a major in the United States Air Force Reserve.

Mr. Berkeley also served as a director of Kintera, Inc. until May 2008, when it was acquired by Blackbaud, Inc. (NASDAQ: BLKB). Mr. Berkeley also served on the board of Fortegra Financial Corporation (NYSE: FRF), an insurance services company that provides distribution and administration services and insurance-related products to insurance companies, insurance brokers and agents and other financial services companies in the United States from December 2010 to November 2011. Mr. Berkeley served on the boards of directors of ACI Worldwide, Inc. (NASDAQ: ACIW) from 2008 until June 2012 and Edgar Online, Inc. (NASDAQ: EDGR), which was sold to RR Donnelley, from November 2010 through August 2012. Mr. Berkeley also serves as a

 

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director of several private companies. Mr. Berkeley received his B.A. in English from the University of Virginia and his M.B.A. from The Wharton School of the University of Pennsylvania. On October 24, 2011, Mr. Berkeley entered into a consent decree with the Securities and Exchange Commission (“SEC”) relating to his role at Pipeline Trading Systems, LLC. We believe Mr. Berkeley’s qualifications to serve on our Board include his extensive experience in corporate finance and securities matters, including his experience as chief executive officer of various companies and his leadership positions with the NASDAQ Stock Market, Inc., and his knowledge gained from service on the boards of various publicly traded and private companies and federal committees.

Peter Gyenes has served as a member of our Board since January 2010, as chairman of our Compensation Committee since February 2010, as a member of our Audit Committee since February 2010, and as a member of our Nominating and Governance Committee since February 2010. Mr. Gyenes served as the non-executive Chairman of the board of directors of Sophos Group plc (LSE: SOPH), a global security software company, from March 2006 until March 2020, as lead independent director from September 2012 to July 2015, and as Chairman from July 2015 until March 2020. Mr. Gyenes served as Chairman and Chief Executive Officer of Ascential Software Corporation, a market leader in data integration software, and its predecessor companies VMark Software, Ardent Software and Informix from 1996 until it was acquired by International Business Machines Corporation in 2005. Mr. Gyenes served on the board of directors of Netezza Corporation from 2008 until it was acquired by International Business Machines Corporation in 2010. Mr. Gyenes also served on the board of Lawson Software, Inc. from 2006 until it was acquired by Infor in July 2011, served on the board of EnerNoc (NASDAQ: ENOC) from 2013 until 2015, served on the board of Cimpress NV (NASDAQ: CMPR) from 2009 until 2015, served on the board of IntraLinks Holdings, Inc. from 2008 to 2017, Carbonite, Inc. (NASDAQ:CARB) from 2015 to 2019 and Sophos Group plc (LSE: SOPH), a global security software company, from 2006 to 2020. He currently serves on the boards of directors of Pegasystems Inc. (NASDAQ: PEGA), a leader in cloud software for customer engagement and operational excellence and serves as trustee emeritus of the Massachusetts Technology Leadership Council. Mr. Gyenes received his B.A. in mathematics and his M.B.A. in marketing from Columbia University. We believe Mr. Gyenes’ qualifications to serve on our Board include his experience as the Chief Executive Officer of a publicly traded company, his knowledge gained from service on the boards of various public and private companies and his more than 40 years of experience in technology, sales, marketing and general management positions within the computer systems and software industry.

Charles F. Kane has served as a member of our Board, as a member of our Compensation Committee and as a member of our Nominating and Governance Committee since June 2012. Mr. Kane has served as a member of our Audit Committee since June 2012 and as chairman of our Audit Committee since February 2013. Mr. Kane is an adjunct professor of international finance at the Massachusetts Institute of Technology Sloan Graduate Business School of Management. Mr. Kane is also a Director and Strategic Advisor of One Laptop Per Child, a non-profit organization founded at Massachusetts Institute of Technology that provides computing and internet access for students in the developing world, for whom he served as President and Chief Operating Officer from 2008 until 2009. Mr. Kane served as Executive Vice President and Chief Administrative Officer of Global BPO Services Corp., a special purpose acquisition corporation, from July 2007 until March 2008, and as Chief Financial Officer of Global BPO from August 2007 until March 2008. Prior to joining Global BPO, he served as Chief Financial Officer of RSA Security Inc., a provider of e-security solutions, from May 2006 until RSA was acquired by EMC Corporation in October 2006. From July 2003 until May 2006, he served as Chief Financial Officer of Aspen Technology, Inc., a provider of supply chain management software and professional services. Mr. Kane is currently a director of Carbonite, Inc. (NASDAQ: CARB), a leading provider of online backup solutions for consumers and small and medium sized businesses, and Progress Software (NASDAQ: PRGS), a global software company that simplifies the development, deployment and management of business applications on-premise or in the cloud, on any platform or device, to any data source, with enhanced performance, minimal IT complexity and low total cost of ownership. Mr. Kane was previously a director of Applix Inc., Borland Software Corporation, Demandware Inc. and Netezza Corporation. Mr. Kane is a Certified Public Accountant and holds a B.B.A. in accounting from the University of Notre Dame and an M.B.A. in international finance from Babson College. We believe Mr. Kane’s experience as a senior executive officer at a number of publicly

 

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traded companies, including as chief financial officer of several of those companies, and his experience serving on the boards of directors of other public and private companies, qualify him to serve on our Board. As an Audit Committee financial expert and chairman of our Audit Committee, Mr. Kane provides a high level of expertise and leadership experience in the areas of finance, accounting, audit oversight and risk analysis derived from his experience as the chief financial officer of publicly traded technology companies. Mr. Kane also offers substantial public company board experience to our Board.

INCUMBENT DIRECTORS WHOSE TERMS OF OFFICE CONTINUE AFTER THE ANNUAL MEETING

The following sets forth information concerning our directors whose terms of office continue after the Annual Meeting, including information as to each director’s age as of the Record Date, current principal occupation and business experience.

 

Name of Director		Age				Position and Offices Held with Company		Director Since
Scott S. Ingraham (2)(3)			66			Director			2012
Dana S. Jones (1)			44			Director			2019
Jeffrey T. Leeds (3)			64			Director			1999
Stephen T. Winn			73			Chairman, and CEO			1998
Jason A. Wright (1)(2)(3)			48			Director			2003

 

(1)	Member of Compensation Committee

(2)	Member of Audit Committee

(3)	Member of Nominating and Governance Committee

Class II Directors (Terms Expire in 2021)

Scott S. Ingraham has served as a member of our Board since February 2012 and as a member of our Audit Committee and our Nominating and Governance Committee since February 2012. Mr. Ingraham is presently the co-founder and Principal of Zuma Capital, Inc., a private investment firm. He co-founded and served as the Chief Executive Officer and Chairman of Rent.com, an Internet residential real estate listing site, from 1999 until its acquisition by eBay in February 2005. Prior to founding Rent.com, Mr. Ingraham was the CEO, president and co-founder of Oasis Residential, a NYSE-traded apartment REIT which merged into Camden Property Trust in 1998. Mr. Ingraham is on the Board of Trust Managers of Camden Property Trust (NYSE: CPT), a real estate investment trust focused on the development and ownership of apartment properties. Camden Property Trust is one of our larger customers. Mr. Ingraham also serves as a director of Kilroy Realty Corporation (NYSE: KRC), a publicly held real estate investment trust focused on the development and ownership of office and industrial properties. Mr. Ingraham graduated from the University of Texas at Austin with a B.B.A. in Finance. We believe Mr. Ingraham’s qualifications to serve on our Board include his substantial financial and business expertise as the chief executive officer of several companies in the real estate industry and his significant experience serving on boards of other publicly traded companies.

Jeffrey T. Leeds has served as a member of our Board and a member of our Nominating and Governance Committee since December 1999. Mr. Leeds has served as chairman of our Nominating and Governance committee since February 2012. Mr. Leeds is President and Co-Founder of Leeds Equity Partners. Leeds Equity Partners, based in New York, is the oldest and largest private equity firm in the United States focused exclusively on investments in the Knowledge Industries — education, training, and business and information services. Prior to co-founding Leeds Equity Partners in 1993, Mr. Leeds spent seven years specializing in mergers and acquisitions and corporate finance at Lazard Freres & Co. LLC, a subsidiary of Lazard Group LLC. Prior to joining Lazard Freres & Co. LLC, Mr. Leeds served as a law clerk to the Hon. William J. Brennan, Jr. of the Supreme Court of the United States during the 1985 October Term. Mr. Leeds also worked in the corporate department of the law firm of Cravath, Swaine & Moore LLP in New York. Mr. Leeds currently serves on the

 

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board of directors of BARBRI, INTO University Partnerships, Knowledge Factor, Fusion Education Group, Endeavor Schools, LLC and Simplify Compliance Holdings, LLC. Mr. Leeds served on the Board of Education Management Corporation (NASDAQ: EDMC) from 2006 through 2017. Mr. Leeds is a member of the Council on Foreign Relations and a member of the Board of Visitors at The Colin L. Powell School for Civic and Global Leadership at The City College of New York. Mr. Leeds received his B.A. in history summa cum laude from Yale University and his J.D. magna cum laude from Harvard Law School. He was also a Marshall Scholar at the University of Oxford. We believe Mr. Leeds’s qualifications to serve on our Board include his extensive business and legal experience in corporate finance and his knowledge gained from service on the boards of various publicly traded and private companies.

Class III Directors (Terms Expire in 2022)

Dana S. Jones has served as a member of our Board and our Compensation Committee since October 2019. Ms. Jones has been CEO of Sparta Systems, a market leader in digital enterprise quality management software for the life sciences space, since April 2018. Prior to joining Sparta, during 2016 and 2017, Ms. Jones served as CEO of Active Network, a leader in activity and event management software. Under her leadership, Ms. Jones supervised the growth of Active Network, leading to the sale of the Sports and Communities divisions to Global Payments Inc. (NYSE:GPN). Before joining Active Network, from 2012 to 2017, Ms. Jones was Chief Marketing Officer and Senior Vice President of Products for Sabre Airline Solutions, a global provider of software to the airline industry. During her time at Sabre, Ms. Jones oversaw revenue and earnings growth and product innovation, and played an important role in the company’s initial public offering. Prior to Sabre, Ms. Jones co-founded Noesis Energy, and served as Executive Vice President of Product, Sales, Marketing, and Operations. Ms. Jones serves on the Board of Directors of Agilysys (NASDAQ:AGYS), a leader in hospitality software. Ms. Jones has held Executive and General Management positions for early stage and global publicly traded enterprise software companies over the last 20 years, including The Reynolds and Reynolds Company and Vignette. She began her career as a management consultant with A.T. Kearney. Ms. Jones graduated Summa Cum Laude from the University of Michigan and holds a BSE in industrial and operations engineering. We believe Ms. Jones’ qualifications to serve on our Board include her experiences as an accomplished software executive with decades of experience leading and growing cloud-based global enterprise software businesses.

Stephen T. Winn has served as our Chief Executive Officer and a member of our Board since November 1998, during which time he served as Chairman of our Board, and as our President from August 2012 until January 2020, a position that Mr. Winn previously held from November 1998 to December 2009. From January 1998 to March 1999, Mr. Winn served in various executive positions, including President of Research Institute of America, a provider of information services to the accounting industry and a wholly owned subsidiary of Thomson Reuters Corporation. From June 1969 to January 1998, Mr. Winn served as President and Chief Executive Officer of Computer Language Research Inc., a publicly traded company focused on tax compliance, tax research and accounting software, which was acquired by Thomson Reuters Corporation. Mr. Winn is a member of the board of directors of the National Multifamily Housing Council. In January 2002, he was one of 25 people recognized by the National Apartment Association as a leader in the multifamily industry. Mr. Winn received Ernst & Young LLP’s “Entrepreneur of the Year 2012 Southwest Area North Technology Sector” award. Mr. Winn received his B.S. in electrical engineering from The University of Texas at Austin and his M.S. in management science from Stanford University. In addition to Mr. Winn’s role as our Chief Executive Officer, we believe Mr. Winn’s qualifications to serve on our Board include his previous service in executive positions at various public and private technology companies and his extensive experience in the multifamily rental housing industry.

Jason A. Wright has served as a member of our Board since December 2003 and as our lead independent director since February 2012. Mr. Wright has served as a member of our Audit Committee since January 2004 and served as chairman of our Audit Committee from February 2012 until February 2013. Mr. Wright has served as a member of our Compensation Committee since October 2006 and a member of our Nominating and Governance Committee since February 2010. Mr. Wright is a partner in the Tech & Telecom Group at Apax Partners LLC, where he focuses primarily on investments in enterprise software and technology-enabled services.

 

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Prior to joining Apax in 2000, Mr. Wright served in a variety of roles at General Electric Capital Corporation, a subsidiary of General Electric Corporation, including the evaluation and execution of investment opportunities for the Technology Ventures Group, and Mr. Wright was also a consultant at Andersen Consulting, now Accenture plc. Mr. Wright currently serves on the board of directors of various private companies. Mr. Wright received his B.A. in economics from Tufts University and his M.B.A. in finance from The Wharton School of the University of Pennsylvania. We believe Mr. Wright’s qualifications to serve on our Board include his extensive business and financial experience related to enterprise software and technology-enabled services companies.

BOARD AND COMMITTEE GOVERNANCE

Board Leadership Structure

Our governance framework provides our Board with flexibility to select the appropriate leadership structure for us. The current leadership structure is composed of a combined chairman of the board and chief executive officer, a lead independent director, Board committees led by independent directors and active engagement by all directors. Our Board believes this structure provides an effective balance between strong Company leadership and appropriate safeguards and oversight by independent directors.

Our Board believes that our Chief Executive Officer, Stephen T. Winn, is best situated to serve as Chairman because he is the director most familiar with our business and industry, and most capable of effectively identifying strategic priorities and leading the discussion and execution of strategy. Our independent directors have different perspectives and roles in strategic development. Our independent directors bring experience, oversight and expertise from outside our company and industry, while the Chief Executive Officer brings company-specific experience and expertise. Our Board believes that the combined role of Chairman and Chief Executive Officer promotes strategy development and execution, and facilitates information flow between management and our Board, which are essential to effective governance.

Mr. Jason A. Wright serves as our lead independent director. Our lead independent director is responsible for coordinating activities of our other independent directors, presiding at all meetings of our Board at which the Chairman is not present, including executive sessions of the independent directors, serving as liaison between the Chairman and the independent directors, having the authority to call meetings of the independent directors, and performing various other duties as directed by our Board. Under our Corporate Governance Guidelines, the lead independent director is charged with relaying the discussions of the executive sessions to the Chief Executive Officer, as appropriate, participating in the discussion of Chief Executive Officer performance with our Compensation Committee, and ensuring that our Board annually conducts a self-assessment.

Director Qualifications

Our Board believes that maintaining a Board with a range of skills and experience meeting our needs is important, as is maintaining a size that facilitates group discussion and collegiality.

Our Nominating and Governance Committee, consisting solely of independent directors as determined under applicable NASDAQ listing standards, is responsible for reviewing with our Board, on an annual basis, the requisite skills and characteristics of potential new Board members as well as the composition of our Board as a whole. This assessment includes members’ qualification as independent, as well as consideration of character, judgment, diversity, age, skills, including financial literacy, and experience in the context of the needs of our Board and our business. Nominees for directorship are selected by our Nominating and Governance Committee and approved by our Board in accordance with such policies and principles as our Board may promulgate after considering the recommendation of our Nominating and Governance Committee.

Our Corporate Governance Guidelines emphasize the importance of maintaining a Board with a range of skills and experience meeting the needs of the Company. Our Nominating and Governance Committee seeks to

 

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identify for Board positions the most qualified candidates, without regard to race, color, veteran status, religion, gender, sex, sexual orientation, medical condition, national origin, marital status or any other characteristics protected by law. Our Nominating and Governance Committee does not have a formal policy with respect to diversity; however, our Board and Nominating and Governance Committee believe that it is important that the members of our Board represent diverse viewpoints, and are committed to an inclusive approach in identifying candidates who provide a variety skills and experience to the Board, including qualified female Board candidates. Our Nominating and Governance Committee’s process for identifying and evaluating nominees typically involves a series of internal discussions, review of information concerning candidates, and interviews with selected candidates. From time to time, we also have engaged one or more executive search consulting firms to assist in the identification and recruitment of potential director candidates.

Our Corporate Governance Guidelines provide that each director should be able and prepared to devote sufficient time and effort to his or her duties as a director. Directors are not permitted to sit on more than six publicly traded company boards or, if such director is a CEO of a public company, he or she is not permitted to sit on the board of more than two public companies besides the board of his or her own company.

Our Board does not have term limits. Directors who have served on our Board for an extended period of time are able to provide valuable insight into our operations and future based on their experience with and understanding of our industry, business operations, history, policy and objectives. Our Board believes that, as an alternative to term limits, it can ensure that the Board continues to evolve through the evaluation and nomination process required by our Corporate Governance Guidelines.

Our Corporate Governance Guidelines also provide that, as a general matter, a director should not stand for re-election as a non-employee director after his or her 75^th birthday. Non-employee directors are required to tender their resignation no later than the expiration of their elected term following their 75^th birthday. Retirement of a director who has reached the age of retirement may be postponed if our Board determines that it would be in the best interests of RealPage and its stockholders under the particular circumstances. In considering the nominees for 2020, the Board considered that Mr. Berkeley is 75 years old and determined that Mr. Berkeley’s extensive experience in corporate finance and securities matters, his experience as a chief executive officer of various companies, his leadership positions with the NASDAQ Stock Market, Inc., and knowledge gained from service on the boards of various publicly traded and private companies and federal committees, are valuable to the Board. The Board has requested, and Mr. Berkeley has consented, to his nomination for an additional term on the Board. In addition, our Board may nominate any person for election as a non-employee director regardless of his or her age if our Board determines that, due to his or her unique capabilities or special circumstances, the election of such person is in the best interest of RealPage.

Our directors are elected under our bylaws by a plurality of the voting power of the shares present in person or represented by proxy at the annual meeting and entitled to vote on the election of directors, which means that the nominees who receive the greatest number of votes will be elected and withheld votes and broker non-votes will not be counted either for or against the election of a director nominee. However, under our Corporate Governance Guidelines, any nominee for director in an uncontested election (i.e., an election where the number of candidates for election does not exceed the number of directors to be elected) who receives a greater number of votes “withheld” from his or her election than votes “for” such election, shall promptly tender his or her resignation following the meeting at which they are elected or reelected as director. In such event, the Nominating and Governance Committee will promptly consider the tendered resignation and will recommend to the Board whether to accept the tendered resignation or to take some other action. In making this recommendation, the Nominating and Governance Committee will consider all factors deemed relevant by its members in deciding whether to recommend acceptance of a director’s resignation.

The Board will act on the Nominating and Governance Committee’s recommendation no later than 90 days following certification of the election results. In considering the Nominating and Governance Committee’s recommendation, the Board will consider all factors deemed relevant by its members in deciding whether to accept a director’s resignation.

 

8

Our Nominating and Governance Committee will consider nominees recommended by stockholders provided such recommendations are made in accordance with procedures described in this proxy statement under “Deadline for Receipt of Stockholder Proposals for 2021 Annual Meeting.” There are no differences in the manner in which our Nominating and Governance Committee evaluates nominees for director based on whether the nominee is recommended by a stockholder.

Director Independence

In accordance with the listing requirements of the NASDAQ Stock Market and our Corporate Governance Guidelines, a majority of our Board must be composed of independent directors. Our Board has determined that each of Mr. Berkeley, Mr. Gyenes, Mr. Ingraham, Ms. Jones, Mr. Kane, Mr. Leeds and Mr. Wright is independent under applicable NASDAQ listing standards and Rule 10A-3 of the Securities Exchange Act of 1934, as amended, or the “Exchange Act.”

Board and Committee Meetings and Attendance

Under our bylaws, regular meetings of our Board are held at such times as our Board may determine. Special meetings of our Board may be called by a majority of the authorized number of directors, the Chairman, the Chief Executive Officer, the President or the Secretary. Our Board held a total of six meetings during 2019. Each director attended 75% or more of the total number of meetings of our Board and the committees of our Board on which such director served during 2019.

The non-employee directors on our Board and Board committees generally meet quarterly in executive session. Executive sessions of our Board may include, among other things, a discussion of the performance of the Chairman and Chief Executive Officer, matters concerning the relationship of our Board with the management directors and other members of senior management, and such other matters as the non-employee directors deem appropriate. No formal action of our Board is taken during executive sessions of the non-employee directors, although the non-employee directors may subsequently recommend matters for consideration by the full Board. In addition, our Audit Committee holds an executive session at each of its meetings and our Compensation Committee holds an executive session at the meeting in which annual compensation is reviewed and determined. On occasion, our non-employee directors invite our Chief Legal Officer to attend executive sessions in the role as legal counsel, but members of management, including Mr. Winn, are otherwise not present at executive sessions of Board and committee meetings. Although all of our current non-employee directors are considered to be independent, if any non-employee directors were determined not to be independent, the independent directors would be required to meet alone in an executive session at least twice per year.

Board Committees

Our Board has three standing committees:

 

•

the Audit Committee;

 

•

the Compensation Committee; and

 

•

the Nominating and Governance Committee.

 

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Committee members are appointed by our Board, which considers the recommendation of our Nominating and Governance Committee and the desires of the individual directors. The table below lists the current membership of each committee and the number of committee meetings held in 2019.

 

Name of Director

Audit Committee

Compensation Committee

Nominating and Governance Committee

Alfred R. Berkeley, III

Member

Peter Gyenes

Member

Chairman

Member

Scott Ingraham

Member

Member

Dana S. Jones

Member

Charles F. Kane

Chairman

Member

Member

Jeffrey T. Leeds

Chairman

Jason A. Wright

Member

Member

Member

Number of meetings held in 2019

4

4

2

Our Board has determined that each member of each committee is independent under the applicable requirements of NASDAQ and SEC rules and regulations. Our Board has adopted a charter for each committee. Copies of such charters are available without charge, upon request in writing to RealPage, Inc., 2201 Lakeside Boulevard, Richardson, Texas 75082, Attn: Chief Legal Officer or on our website at https://investor.realpage.com/corporate-governance/governance-documents or https://www.realpage.com/ by clicking on “Company,” “Investor Relations,” “Governance” and then “Governance Documents.” We believe that the composition, charter and functioning of each of our committees comply with the applicable requirements of NASDAQ and SEC rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.

The primary responsibilities of each committee are described below.

Audit Committee

Our Audit Committee’s responsibilities are specifically set forth in the committee’s charter, which can be found at https://investor.realpage.com/corporate-governance/governance-documents or https://www.realpage.com/ by clicking on “Company,” “Investor Relations,” “Governance” and then “Governance Documents.” Among other things, our Audit Committee is responsible for:

 

•

approving the audit and non-audit services to be performed by our independent auditors;

 

•

evaluating the qualifications, performance and independence of our independent auditors;

 

•

monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to financial statements or accounting matters;

 

•

reviewing the adequacy and effectiveness of our internal control policies and procedures;

 

•

discussing the scope and results of the audit with the independent auditors and reviewing with management and the independent auditors our interim and year-end operating results;

 

•

preparing the audit committee report required in our annual proxy statement; and

 

•

reviewing and evaluating, at least annually, its own performance and that of its members, including compliance with the committee charter.

Our Board has determined that each member of our Audit Committee is independent under the applicable requirements of NASDAQ and SEC rules and regulations, meets the requirements for financial literacy and sophistication, and qualifies as an “audit committee financial expert” under the applicable requirements of NASDAQ and SEC rules and regulations.

 

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Compensation Committee

Our Compensation Committee’s responsibilities are specifically set forth in the committee’s charter, which can be found at https://investor.realpage.com/corporate-governance/governance-documents or https://www.realpage.com/ by clicking on “Company,” “Investor Relations,” “Governance” and then “Governance Documents.” Among other things, our Compensation Committee is responsible for:

 

•

overseeing our overall compensation philosophy, compensation plans and benefits programs;

 

•

reviewing and recommending to the full Board, or approving, new executive compensation programs and revisions to existing programs;

 

•

periodically reviewing executive compensation programs and total compensation levels, including conducting comparative analyses of total compensation relative to market, quantifying maximum payouts to executives under performance-based incentive plans and total payments under a variety of termination conditions, including upon a change of control, and the impact of tax and accounting rules and changes;

 

•

reviewing and recommending compensation programs for outside directors;

 

•

reviewing and approving corporate goals and objectives relevant to compensation of our Chief Executive Officer and evaluating his performance in light of such goals and objectives;

 

•

reviewing and approving the following for our Chief Executive Officer and our other executive officers identified by our Compensation Committee: annual base salaries, annual incentive bonuses, including the specific goals and amounts, equity compensation, employment agreements, severance arrangements and change in control arrangements, signing bonuses and payment of relocation costs, and any other benefits, compensation or arrangements;

 

•

reviewing and recommending to the full Board, or approving, any contracts or other transactions with our current or former executive officers;

 

•

reviewing the plans for officer development and corporate succession plans for our Chief Executive Officer and other senior executive officers;

 

•

in its discretion, retaining or obtaining advice of compensation consultants, outside legal counsel or other advisors to assist our Compensation Committee in the performance of its responsibilities, and appointing, compensating and overseeing the work of any such consultants, counsel and advisors;

 

•

establishing and administering annual and long-term incentive compensation plans for senior executive officers, including establishing performance objectives and certifying performance achievement, and reviewing and approving all equity-based compensation plans and granting awards of shares and stock options pursuant to such plans;

 

•

administering our equity incentive plans, including granting awards under such plans to eligible persons in accordance with procedures and guidelines established by the Board, and recommending to our Board any amendments to the plans and changes in the number of shares reserved for issuance under such plans;

 

•

reviewing and discussing with management the compensation discussion and analysis and related disclosures required by the SEC, and reviewing and recommending the final compensation discussion and analysis to our Board for inclusion in our annual report and proxy statement;

 

•

preparing the compensation committee report required by the SEC to be furnished with our annual report and proxy statement;

 

•

reviewing and reassessing the adequacy of the Compensation Committee charter and recommending changes to our Board for approval; and

 

•

reviewing and evaluating, at least annually, its own performance and that of its members, including compliance with our Compensation Committee charter.

 

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Our Board has determined that each member of our Compensation Committee is independent under the applicable requirements of NASDAQ and SEC rules and regulations, and is a non-employee director, as defined by Rule 16b-3 promulgated under the Exchange Act.

Additional information regarding the processes and procedures that our Compensation Committee employs when considering and determining director and executive compensation, including the committee’s engagement of independent compensation consultants for advice in connection with the exercise of its responsibilities, is set forth below under “Governance — Director Compensation” and “Executive Compensation — Compensation Discussion and Analysis.”

Nominating and Governance Committee

Our Nominating and Governance Committee’s responsibilities are specifically set forth in the committee’s charter, which can be found at https://investor.realpage.com/corporate-governance/governance-documents or https://www.realpage.com/ by clicking on “Company,” “Investor Relations,” “Governance” and then “Governance Documents.” Among other things, our Nominating and Governance Committee is responsible for:

 

•

assisting our Board in identifying prospective director nominees and recommending nominees for each annual meeting of stockholders to our Board;

 

•

reviewing developments in corporate governance practices and developing and recommending governance principles applicable to our Board;

 

•

overseeing the evaluation of our Board and management;

 

•

recommending members for each Board committee to our Board;

 

•

reviewing and monitoring our Code of Business Conduct and Ethics and actual and potential conflicts of interest of members of our Board and officers; and

 

•

reviewing and evaluating, at least annually, its own performance and that of its members, including compliance with the committee charter.

Our Board has determined that each member of our Nominating and Governance Committee is independent under the applicable requirements of NASDAQ and SEC rules and regulations.

Board Oversight of Risk

Our Board oversees risk management in a number of ways. Our Audit Committee oversees the management of financial and accounting related risks as an integral part of its duties. Similarly, our Compensation Committee considers risk management when setting the compensation policies and programs for our executive officers and other employees. Our full Board considers various risk-related items periodically, including risks related to intellectual property, taxes, products and employees, as well as the impact on us of public health issues such as the coronavirus (COVID-19). Our Board also considers our efforts to manage such risks through safety measures, insurance or self-insurance.

Communication with our Board

Stockholders may communicate with members of our Board by mail addressed to the Chairman, to any other individual member of our Board, to the full Board, or to a particular committee of our Board. In each case, such correspondence should be sent to the following address: 2201 Lakeside Boulevard, Richardson, Texas 75082, Attention: Corporate Secretary. Correspondence received that is addressed to the members of our Board will be reviewed by our Chief Legal Officer or our Chief Legal Officer’s designee, who will forward such correspondence to the appropriate members of our Board.

 

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ADDITIONAL GOVERNANCE INFORMATION

We are committed to strong corporate governance, which we believe promotes the long-term interests of stockholders, strengthens Board and management accountability and helps build public trust in RealPage.

Articles and Bylaws

Our certificate of incorporation and bylaws can be accessed through our filings located in the “Company Filings” portion of the SEC website at www.sec.gov. Our amended and restated certificate of incorporation was attached as Exhibit 3.1 to our Form 10-Q filed with the SEC on August 6, 2018 and our bylaws were attached as Exhibit 3.4 to our Registration Statement on Form S-1/A filed with the SEC on July 26, 2010. Our Code of Business Conduct and Ethics, Corporate Governance Guidelines, Board committee charters and other governance materials can be accessed on our website, https://investor.realpage.com/corporate-governance/governance-documents or https://www.realpage.com/, by clicking on “Company,” “Investor Relations,” “Governance” and then “Governance Documents.”

Code of Business Conduct and Ethics

Our Board has adopted a Code of Business Conduct and Ethics. The code applies to all of our employees, officers (including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions), directors and agents. A copy of our Code of Business Conduct and Ethics can be found on our website at https://investor.realpage.com/corporate-governance/governance-documents or https://www.realpage.com/, by clicking on “Company,” “Investor Relations,” “Governance” and then “Governance Documents.” A copy also is available without charge upon request in writing to RealPage, Inc., 2201 Lakeside Boulevard, Richardson, Texas 75082, Attn: Chief Legal Officer. We intend to disclose future amendments to provisions of our Code of Business Conduct and Ethics, or waivers of such provisions applicable to any principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, or our directors, on our website to the extent and in the manner permitted by Item 5.05 of Form  8-K.

Corporate Governance Guidelines

Our Board has adopted Corporate Governance Guidelines that address matters pertaining to director qualifications, director responsibilities, lead independent director responsibilities, executive sessions of Board meetings, communications with stockholders, Board committee matters, director access to officers, employees and independent advisors, director compensation, director minimum stock ownership requirements, director orientation and continuing education, Chief Executive Officer evaluation, management and Board succession, indemnification and director and officer insurance, and annual Board performance evaluations. A copy of the Corporate Governance Guidelines can be found on our website at https://investor.realpage.com/corporate-governance/governance-documents or https://www.realpage.com/, by clicking on “Company,” “Investor Relations,” “Governance” and then “Governance Documents.” A copy also is available without charge upon request in writing to RealPage, Inc., 2201 Lakeside Boulevard, Richardson, Texas 75082, Attn: Chief Legal Officer.

Director Minimum Stock Ownership Requirements

Our Board members are encouraged to make a substantial investment in Company stock. Accordingly, our Corporate Governance Guidelines require our directors to own a number of shares of our common stock with an aggregate value equal to at least three times their annual cash retainer within four years after joining our Board or as soon thereafter as is practicable. During 2019 and as of the date of this proxy statement, each of our Board members maintained stock ownership consistent with our stock ownership guidelines. Our Board has also adopted a Stock Ownership Guidelines Policy for our Chief Executive Officer as described under “Executive Compensation —Other Executive Compensation Consideration —Executive Stock Ownership” below.

 

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Hedging, Short Sale and Pledging Policy under our Insider Trading Policy

We have adopted an Insider Trading Policy. That policy prohibits all employees, including our executive officers, and all directors and agents from purchasing any financial instrument that is designed to hedge or offset any decrease in the market value of our securities. All employees, including our executive officers, and all of our directors and agents are also prohibited from pledging our securities or engaging in short sales of our securities.

Director Attendance at Annual Meetings of Stockholders

We encourage, but do not require, our directors to attend our annual stockholders’ meeting. Our board members were not able to attend our 2019 annual meeting.

DIRECTOR COMPENSATION

Determining Compensation for Non-Employee Directors in 2019

Our Compensation Committee reviews and makes recommendations to our Board regarding the form and amount of compensation for non-employee directors. Directors who are employees of RealPage receive no compensation for service on our Board. Our director compensation program is designed to enable continued attraction and retention of highly qualified directors by ensuring that director compensation is in line with peer companies competing for director talent, and is designed to address the time, effort, expertise and accountability required of active board membership. Our Compensation Committee and our Board believe that annual compensation for non-employee directors should consist of both a cash component, designed to compensate members for their service on our Board and its committees, and an equity component, designed to align the interests of directors and stockholders and, by vesting over time, to create an incentive for continued service on our Board.

Discussion of Director Compensation

In 2019, the annual compensation for our non-employee directors was composed of cash compensation in the form of an annual retainer and meeting and committee fees and equity compensation in the form of restricted stock awards. Each of these components is described below.

Independent Director Compensation Plan

Our independent director compensation plan provided for the following compensation to our independent directors during 2019:

 

Retainer		$12,500 per quarter
Lead Independent Director retainer		$5,000 per quarter
Audit Committee chair retainer		$6,250 per quarter
Audit Committee member (excluding chair) retainer		$3,000 per quarter
Compensation Committee chair retainer		$5,000 per quarter
Compensation Committee member (excluding chair) retainer		$2,250 per quarter
Other Board committee chair retainer		$3,000 per quarter
Other Board committee member (excluding chair) retainer		$1,500 per quarter
Annual restricted stock grant (each April 1)		$220,000 restricted stock value (1)

 

(1)

The restrictions related to each annual restricted stock grant lapse with respect to 25% of the restricted shares subject to the grant each quarter commencing on the first day of the calendar quarter immediately following the grant date for four consecutive quarters, subject to the continuous service of the director through each applicable date.

 

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In February 2020, in connection with its regular review of independent director compensation and based in part on information and advice from Meridian Compensation Partners, LLC, its independent compensation consultant with respect to compensation elements, levels and trends in outside director compensation among our peer group of companies, our Compensation Committee determined that all elements of director compensation described above should remain the same in 2020 as in 2019.

The term “independent directors” for purposes of our independent director compensation plan means each of our non-employee directors. The annual equity grants occur automatically on April 1 of each year, pursuant to the terms of the RealPage, Inc. 2010 Equity Incentive Plan (as amended and restated June 4, 2014), as further amended (the “2010 Equity Incentive Plan”).

On April 1, 2019, pursuant to our amended independent director compensation plan and the automatic annual restricted stock grant provisions of our 2010 Equity Incentive Plan, we issued 3,645 shares of our restricted common stock to each of Alfred R. Berkeley, III, Peter Gyenes, Scott S. Ingraham, Charles F. Kane, Jeffrey T. Leeds, and Jason A. Wright. On October 21, 2019, pursuant to our amended independent director compensation plan and the prorated initial restricted stock grant provisions of our 2010 Equity Incentive Plan, we issued 1,471 shares of our restricted common stock to Dana S. Jones upon her election to the Board of Directors.

On April 1, 2020, pursuant to our amended independent director compensation plan and the automatic annual restricted stock grant provisions of our 2010 Equity Incentive Plan, we issued 3,947 shares of our restricted common stock to each of Alfred R. Berkeley, III, Peter Gyenes, Scott S. Ingraham, Dana S. Jones, Charles F. Kane, Jeffrey T. Leeds, and Jason A. Wright.

Director Compensation Table for Year Ended December 31, 2019

The following table sets forth the annual director compensation paid or accrued by us to individuals who were directors during any part of 2019. The table excludes Stephen T. Winn, who is our Chief Executive Officer and who did not receive any compensation from us in his role as director in 2019.

DIRECTOR COMPENSATION TABLE FOR YEAR ENDED DECEMBER 31, 2019

 

Name		Fees Earned or Paid in  Cash				Stock Awards (1)				Total
Alfred R. Berkley, III		$	57,000			$	220,000			$	277,000
Peter Gyenes			85,500				220,000				305,500
Scott S. Ingraham			81,250				220,000				301,250
Dana S. Jones			14,750				89,113				103,863
Charles F. Kane			86,750				220,000				306,750
Jeffrey T. Leeds			60,750				220,000				280,750
Jason A. Wright			93,750				220,000				313,750

 

(1)

Equals 3,645 shares granted to Mr. Berkeley, Mr. Gyenes, Mr. Ingraham, Mr. Kane, Mr. Leeds and Mr. Wright and equals 1,471 shares granted to Ms. Jones in 2019. The number of shares granted was determined based upon the average of the closing market price of RealPage common stock on each of the 30 trading days immediately preceding the grant date. The value of each award, as calculated pursuant to the aggregate grant date fair value computed in accordance with FASB ASC Topic 718, was $225,626 for Mr. Berkeley, Mr. Gyenes, Mr. Ingraham, Mr. Kane, Mr. Leeds and Mr. Wright and $89,113 for Ms. Jones. See Note 10 of Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2019, for a discussion of assumptions made in determining the grant date fair value of our restricted stock awards.

 

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TRANSACTIONS WITH RELATED PERSONS, PROMOTERS AND CERTAIN CONTROL PERSONS.

Since January 1, 2019, there has not been, nor is there currently proposed, any transaction or series of similar transactions to which we were or are a party in which the amount involved exceeded or exceeds $120,000 and in which any of our directors, nominees for director, executive officers, holders of more than 5% of any class of our voting securities, or any member of the immediate family of any of the foregoing persons, had or will have a direct or indirect material interest, other than compensation arrangements with directors and executive officers, which are described under “Governance — Director Compensation,” “Executive Compensation — Compensation Discussion and Analysis,” and the following transactions.

On May 1, 2019, we entered into a Preferred Provider and Strategic Marketing Agreement (“Preferred Provider Agreement”) and a RealPage One Master Agreement (“OMA”) with the Winn Family Office, LLC (“WFO”). Pursuant to these agreements, we and WFO agreed that WFO will recommend us as a preferred provider of services to managers of real estate development properties in which WFO has an ownership interest. WFO is owned and controlled by Steve Winn, the Chairman of the Board and Chief Executive Officer and (with his affiliates) a principal shareholder of RealPage. During 2019, RealPage received a total of $192,272 in fees from WFO related to these agreements. We believe that the terms provided to WFO pursuant to these agreements, including the pricing for services and the other commercial terms contained therein, are reasonable and reflect terms that we offer or would offer to unrelated third parties presenting a commercial opportunity similar in scope to that provided by WFO.

Ms. Glover’s sister in law has been a non-executive employee of RealPage since May 2011, and in such capacity receives annual compensation in excess of $120,000. Such employment terms were established by RealPage directly with Ms. Glover’s sister in law and are based upon market terms and not based upon Ms. Glover’s relationship with us.

Stock Options and Restricted Stock

Certain restricted stock grants to our non-employee directors are described in “Director Compensation.”

Certain stock option and restricted stock grants to our named executive officers (“NEOs”) are described in “Executive Compensation — Grants of Plan-Based Awards,” “Executive Compensation — Compensation Tables — Outstanding Equity Awards at December 31, 2019” and “Executive Compensation — Compensation Tables — Supplemental Information Regarding Arrangements With Executive Officers  — Employment Agreements.”

Employment Arrangements and Indemnification Agreements

We have entered into employment agreements with each of our executive officers that include, among other things, compensation terms, provisions regarding payments upon termination in certain circumstances and confidentiality, non-competition and indemnification provisions. The employment agreements with our NEOs are described under “Executive Compensation — Compensation Tables — Supplemental Information Regarding Arrangements With Executive Officers — Employment Agreements.”

Other Relationships

There are no family relationships among any of our directors or executive officers.

Policies and Procedures for Related Party Transactions

Our Code of Conduct requires that our directors, officers and employees disclose any transaction involving the Company in which they have a significant financial interest, and seek approval where required by the Code of

 

16

Conduct. Our Audit Committee is responsible for reviewing and approving in advance any related party transaction. Our Audit Committee has not adopted specific policies or guidelines relating to the approval of related party transactions. Our directors who are members of our Audit Committee determine whether to approve related party transactions in the exercise of their fiduciary duties as directors and members of our Audit Committee and the terms of our Code of Conduct.

Limitations on Liability and Indemnification Matters

Our amended and restated certificate of incorporation contains provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for:

 

•

any breach of the director’s duty of loyalty to us or our stockholders;

 

•

any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

 

•

unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or

 

•

any transaction from which the director derived an improper personal benefit.

Our amended and restated certificate of incorporation and amended and restated bylaws provide that we are required to indemnify our directors and officers, in each case to the fullest extent permitted by Delaware law. Our amended and restated bylaws also provide that we are obligated to advance expenses incurred by a director or officer in advance of the final disposition of any action or proceeding, and permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in that capacity regardless of whether we would otherwise be permitted to indemnify him or her under the provisions of Delaware law. We have entered into agreements to indemnify our directors, executive officers and other employees as determined by our Board. With specified exceptions, these agreements provide for indemnification for related expenses including, among other things, attorneys’ fees, judgments, fines and settlement amounts incurred by any of these individuals in any action or proceeding. We believe that these bylaw provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers. We also maintain directors’ and officers’ liability insurance.

The limitation of liability and indemnification provisions of our amended and restated certificate of incorporation and amended and restated bylaws may discourage stockholders from bringing a lawsuit against our directors and officers for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against our directors and officers, even though an action, if successful, might benefit us and other stockholders. Further, a stockholder’s investment may be adversely affected to the extent that we pay the costs of settlement and damage awards against directors and officers as required by these indemnification provisions. At present, there is no pending litigation or proceeding involving any of our directors, officers or employees for which indemnification is sought, and we are not aware of any threatened litigation that may result in claims for indemnification.

 

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SECURITY OWNERSHIP

OWNERSHIP OF EQUITY SECURITIES OF REALPAGE

The following table sets forth information regarding ownership of our common stock by:

 

•

each person or group of affiliated persons known by us to be the beneficial owner of more than 5% of our outstanding common stock;

 

•

each of our directors and nominees for director;

 

•

each of our NEOs; and

 

•

all directors and executive officers as a group.

The amounts for our NEOs and executive officers and directors as a group and our significant stockholders are as of April 9, 2020, the Record Date, unless otherwise indicated in a footnote below (and in that case are based upon SEC filings made on behalf of such owners). Beneficial ownership in this table is determined in accordance with the rules of the SEC, and does not necessarily indicate beneficial ownership for any other purpose. Under these rules, the number of shares of common stock deemed outstanding includes all shares of restricted stock, and those shares issuable upon exercise of options held by the respective person or group that may be exercised within 60 days after April 9, 2020. For purposes of calculating each person’s or group’s percentage ownership, unvested stock options exercisable within 60 days and all shares of restricted stock are included for that person or group, but not for any other person or group. Percentage of beneficial ownership is based on the shares of common stock outstanding as of April 9, 2020. Beneficial ownership representing less than 1% is denoted with an asterisk (*).

 

Name and Address of Beneficial Owner (1)		Number of Shares Beneficially Held				Approximate Percentage of Common Stock Outstanding
5% Stockholders:
Stephen T. Winn and entities affiliated with Stephen T. Winn (2)			12,011,248				12.44	%
BlackRock, Inc. (3)			5,024,523				5.22
The Vanguard Group (4)			7,312,160				7.60
T. Rowe Price Associates Inc. (5)			9,615,290				9.99
Named Executive Officers, Directors and Nominees:
Stephen T. Winn (2)			12,011,248				12.44
Thomas C. Ernst, Jr. (6)			111,860				*
Ashley Glover (7)			171,494				*
David G. Monk(8)			227,147				*
William P. Chaney (9)			86,407				*
W. Bryan Hill(10)			11,566				*
Alfred R. Berkeley, III (11)			37,404				*
Peter Gyenes (12)			119,973				*
Scott S. Ingraham (13)			59,800				*
Dana S. Jones(14)			5,418				*
Charles F. Kane (15)			26,764				*
Jeffrey T. Leeds (16)			186,096				*
Jason A. Wright (17)			98,425				*
All executive officers and directors as a group (17 people) (18)			13,422,804				13.91	%

 

(1)	Unless otherwise indicated and subject to applicable community property laws, to our knowledge, each stockholder named in the following table possesses sole voting and investment power over the shares listed,

 

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except for those jointly owned with that person’s spouse. Unless otherwise noted below, the address of each person listed on the table is c/o RealPage, Inc., 2201 Lakeside Boulevard, Richardson, Texas 75082.

(2)

Represents 12,011,248 shares held by Stephen T. Winn, of which 639,860 shares are subject to forfeiture to us and 275,000 shares are issuable upon the exercise of options to purchase shares of our common stock held by Mr. Winn that are exercisable within 60 days after April 9, 2020, 7,304,587 shares held by Seren Capital, Ltd., and 3,000,000 shares held by Seren Capital II, Ltd. Stephen T. Winn is the sole manager and president of Seren Capital Management, L.L.C., which is the general partner of Seren Capital, Ltd., or the Seren Partnership, and, by virtue of this relationship, has sole voting and dispositive power over the shares held by the Seren Partnership. Stephen T. Winn is the sole manager and president of Seren Capital Management II, L.L.C., which is the general partner of Seren Capital II, Ltd., or the Seren II Partnership, and, by virtue of this relationship, has sole voting and dispositive power over the shares held by the Seren II Partnership.

(3)

Pursuant to a Schedule 13G filed February 10, 2020, represents 5,024,523 shares beneficially owned by BlackRock, Inc. (“BlackRock”), 55 East 52nd Street, New York, NY 10055. BlackRock has sole power to vote or to direct the vote of 4,729,862 shares and sole power to dispose or to direct the disposition of 5,024,523 shares.

(4)

Pursuant to a Schedule 13G/A filed February 12, 2020, represents 7,312,160 shares beneficially owned by The Vanguard Group (“Vanguard”), 100 Vanguard Blvd., Malvern, PA. 19355. Vanguard has sole power to vote or direct to vote 46,639 shares, shared power to vote or direct to vote 15,564 shares, sole power to dispose or to direct the disposition of 7,260,642 shares and shared power to dispose of or to direct the disposition of 51,518 shares. Vanguard Fiduciary Trust Company, a wholly-owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 35,954 shares as a result of its serving as investment manager of collective trust accounts. Vanguard Investments Australia, Ltd., a wholly-owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 26,249 shares as a result of its serving as investment manager of Australian investment offerings.

(5)

Pursuant to a Schedule 13G/A filed March 10, 2020, represents 9,615,290 shares beneficially owned by T. Rowe Price Associates, Inc. (“Price Associates”). As reported in the Schedule 13G/A, (i) Price Associates has sole power to dispose or to direct the disposition of 9,615,290 shares and (ii) Price Associates has sole power to vote or direct to vote 2,110,389 shares and T. Rowe Price New Horizons Fund, Inc. has sole power to vote or direct to vote 6,388,916 shares. The address for these entities is 100 E. Pratt Street, Baltimore, MD 21202. Price Associates has sole power to vote or direct to vote 2,110,389 shares and sole power to dispose or to direct the disposition of 9,615,290 shares. Price New Horizons Fund has sole power to vote or direct to vote 6,388,916 shares.

(6)	Includes 98,037 shares subject to forfeiture to us held by Mr. Ernst.

(7)	Includes 151,546 shares subject to forfeiture to us held by Ms. Glover.

(8)	Includes 58,894 shares subject to forfeiture to us and 71,045 shares issuable upon the exercise of options to purchase shares of our common stock held by Mr. Monk that are exercisable within 60 days after April 9, 2020.

(9)	Includes 77,048 shares subject to forfeiture to us held by Mr. Chaney.

(10)	Based upon the most recent information available to the Company as of May 2019.

(11)	Includes 3,947 shares subject to forfeiture to us, and 6,931 shares held jointly by Alfred R. Berkeley III and Muriel Van Dusen Berkeley as tenants in entirety.

(12)	Includes 3,947 shares subject to forfeiture to us held by Mr. Gyenes.

(13)	Includes 3,947 shares subject to forfeiture to us held by Mr. Ingraham.

(14)	Includes 4,684 shares subject to forfeiture to us held by Ms. Jones.

(15)	Includes 3,947 shares subject to forfeiture to us held by Mr. Kane.

(16)	Includes 3,947 shares subject to forfeiture to us held by Mr. Leeds.

(17)	Includes 3,947 shares subject to forfeiture to us held by Mr. Wright.

(18)

Consists of 13,411,238 shares held of record by our directors and executive officers, which includes 1,234,539 shares subject to forfeiture to us, 346,497 shares issuable upon the exercise of options held by our directors and executive officers that are exercisable within 60 days after April 9, 2020 and 10,304,587 shares held by entities over which our directors and executive officers may be deemed to have voting or dispositive power.

 

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EXECUTIVE OFFICERS

The following table sets forth the name, age, and position of each of our executive officers as of the Record Date.

 

Name of Executive Officer		Age				Position
Stephen T. Winn			73			Chairman of the Board of Directors and Chief Executive Officer
Thomas C. Ernst, Jr.			51			Executive Vice President, Chief Financial Officer and Treasurer
Ashley Glover			48			President
Michael A. Britti			60			Executive Vice President, Mergers and Acquisitions and Emerging Markets
David G. Monk			53			Executive Vice President, Chief Legal Officer and Secretary
Barry R. Carter			57			Senior Vice President, Chief Information Officer
Brian Shelton			46			Senior Vice President and Chief Accounting Officer
Kurt E. Twining			65			Senior Vice President, Chief People Officer

Executive Officers

Stephen T. Winn serves as our Chairman of the Board, Chief Executive Officer and President, and is a member of our Board. See “Governance — Incumbent Directors Whose Terms Of Office Continue After The Annual Meeting” for additional information with respect to Mr. Winn.

Thomas C. Ernst, Jr. has served as our Executive Vice President, Chief Financial Officer and Treasurer since January 2019. Mr. Ernst is responsible for the company’s financial management and reporting, including investor relations, credit facility management, financial planning and analysis, internal reporting, mergers and acquisitions, product pricing control and billing. Mr. Ernst brings more than 20 years of experience in software industry finance and investment advisory, where he advised many high-profile SaaS businesses on organic and acquisition strategies to drive innovation and growth. In 2015, he founded Tom Ernst Advisory (TEA), a strategic consulting firm focused on the software industry. In 2018, Mr. Ernst led TEA in providing strategic advice to software companies, including RealPage. Prior to TEA, Mr. Ernst led the Goldman Sachs Software Investment Banking Team globally and the Deutsche Bank Software U.S. Equity Research Team in coverage of over 30 stocks. Prior to Goldman Sachs, he served as a nuclear engineer and submarine warfare officer in the U.S. Navy. Mr. Ernst has a B.S. in Mathematics from the University of Minnesota and an M.B.A. from the University of Chicago Booth School of Business.

Ashley Glover has served as our President since January 2020. Ms. Glover is responsible for the execution of RealPage’s business plan, focusing primarily on the Company’s largest multifamily businesses and our global operations. Ms. Glover served as our Executive Vice President, Chief Operating Officer from January 2018 until January 2020 and managed international operations and customer acquisition, assimilation and retention organizations. Ms. Glover also served as our Executive Vice President and Chief Revenue Officer from August 2016 until January 2018. Ms. Glover served as a consultant in real estate investment, operations, and strategy in the US and Europe from January 2014 to July 2016. Ms. Glover served as our Executive Vice President, Chief Sales and Marketing Officer from February 2012 to December 2013 and previously served as our Executive Vice President, Multifamily Solutions from January 2010 to February 2012, as our Executive Vice President, Resident Solutions from April 2009 to January 2010 and as our Senior Vice President, Velocity Utility and Billing Services, from March 2005 until April 2009. From November 2004 through early March 2005, Ms. Glover served in a consulting capacity for us in conjunction with our acquisition of The Pleco Group, LLC. From August 1995 to July 1997 and again from August 1999 to July 2003, Ms. Glover handled both international and domestic assignments for McKinsey & Company. Ms. Glover received her B.S. in computer science from Southern Methodist University and her M.B.A. from Harvard University.

Michael A. Britti has served as our Executive Vice President of Mergers and Acquisitions and Emerging Markets since January 2020. Mr. Britti is responsible for managing our various Emerging Markets businesses,

 

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which include our Mixed Use, AIM, vacation rental, and related businesses. Mr. Britti also manages mergers and acquisitions. Prior to January 2020 and since August 2009, Mr. Britti served as our Senior Vice President of Mergers and Acquisitions, overseeing the negotiation and closing of transactions valued at more than $2 billion. Prior to joining the Company, Mr. Britti served as the GVP of Rental Screening Solutions, a business unit of TransUnion LLC. Prior to that, Mr. Britti served as the CEO and founder of CreditRetriever LLC. He has held senior-level positions at successful start-ups, including OpsTechnology (now a wholly owned subsidiary of RealPage), SafeRent and One Point Communication. He has two US Patents for inventions in screening processes and is a member of the National Multifamily Housing Council and National Apartment Association. Mr. Britti attended the University of Maryland College Park and the University of Pennsylvania’s Wharton School of Business.

David G. Monk has served as our Executive Vice President, Chief Legal Officer and Secretary since January 2016. Mr. Monk is responsible for management of our legal department and compliance operations. Mr. Monk previously served as our Senior Vice President, Chief Legal Officer and Secretary from May 2015 through January 2016, and as Senior Vice President and Deputy General Counsel from June 2010 through April 2015. Prior to joining us, Mr. Monk was a partner in private practice with the international law firm Baker Botts L.L.P., where he practiced from October 1992 to June 2010 and represented clients on a variety of matters including mergers and acquisitions, securities offerings, SEC compliance, corporate governance, technology and outsourcing transactions, and general corporate matters. Mr. Monk received his B.B.A. in finance from Texas A&M University and his J.D. from Southern Methodist University’s Dedman School of Law.

Barry R. Carter has served as our Senior Vice President and Chief Information Officer since July 2017. Mr. Carter is responsible for overseeing the management of our Information Technology operations, corporate applications, product engineering, enterprise architecture, and portfolio management. Before joining RealPage and from August 2012 to July 2017, Mr. Carter served as Chief Financial Officer and Chief Operating Officer at EFG, a specialty insurance company in Las Colinas, driving the digital transformation of sales. Prior to then, Mr. Carter served in a variety of leadership roles, including executive vice president of Fujitsu American, and chief information officer of Alliance Data, Capital One Auto Finance, and AirTran Airways. In 2009, Mr. Carter was selected by the CIO Leadership Network as a winner of the Global Innovation and Change Leadership Award. Mr. Carter received his B.A. in Computer Science from East Carolina University and his M.B.A. in Organizations and Management from Syracuse University. Most recently, he received the MIT Sloan School of Management Executive Certificate in Technology, Operations, and Value Chain Management.

Brian Shelton has served as our Senior Vice President and Chief Accounting Officer since January 2020. As the Company’s principal accounting officer, Mr. Shelton oversees all accounting functions including internal and external financial reporting, corporate accounting, acquisitions and divestitures, revenue operations and accounting and stock administration. Mr. Shelton’s financial and accounting experience spans more than two decades. He has been with RealPage since 2014, previously serving as our Senior Vice President, Finance, where Mr. Shelton’s primary responsibilities included financial planning and analysis, merger and acquisition support, and internal reporting. From 2004 through 2014, he held various financial leadership roles at St. Jude Medical, Inc., a global medical device manufacturer acquired by Abbot Laboratories in 2017. Prior to joining St. Jude Medical, Inc., Mr. Shelton held positions with Ernst & Young LLP and Arthur Andersen LLP. Mr. Shelton received his B.S. in Accountancy from Northern Arizona University and his M.B.A. from the Cox School of Business at Southern Methodist University.

Kurt E. Twining has served as our Senior Vice President and Chief People Officer since July 2011. Mr. Twining oversees our human resources affairs, including employee recruitment, compensation, benefits, human resource management systems, organizational development, community outreach activities relating to inclusion and philanthropy, and global facilities operations. Mr. Twining brings extensive human resource experience in creating high performing cultures in companies on a global basis. His industry experience includes high tech, consumer goods, logistics, and consultative engagements with many Fortune 500 companies. Before joining RealPage, Mr. Twining was general manager and partner for Buck Consulting, a firm specializing in all

 

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areas of human capital, inclusive of talent management, rewards systems, and executive compensation to board of directors. Prior to joining Buck Consulting, he served in a variety of leadership roles as senior vice president of HR for Freescale Semiconductor, general manager for the Hay Group, senior vice president of HR for AmeriServe, vice president at PepsiCo Food Systems and in progressive human resources positions for Texas Instruments. He is a member of the National Apartment Association and the National Multifamily Housing Council and has served on the executive boards for Habitat for Humanity and The Family Place. Mr. Twining received his B.S. in Criminal Justice and his M.S. in Industrial Labor Relations from Michigan State University.

 

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