8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________________________________

FORM 8-K

_______________________________________________________________________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)

February 27, 2017

______________________________________________________________________________________________

RealPage, Inc.

(Exact name of registrant as specified in its charter)

______________________________________________________________________________________________

Delaware	001-34846	75-2788861
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
2201 Lakeside Blvd. Richardson, Texas		75082
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (972) 820-3000

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

______________________________________________________________________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

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

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

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

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

Item 1.01Entry into a Material Definitive Agreement.

Asset Purchase Agreement with Rainmaker Group

On February 27, 2017, RealPage, Inc., a Delaware corporation (“RealPage”), and RP Newco XX LLC, a newly formed Delaware limited liability company and wholly owned subsidiary of RealPage (“Newco”), entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Rainmaker Group Holdings, Inc., a Georgia corporation (“RGH”), The Rainmaker Group Ventures, LLC, a Delaware limited liability company (“RGV”), certain other affiliated parties and major equityholders of RGH and RGV (collectively, the “Sellers”) and a designated representative of the Seller equity holders. Pursuant to the Asset Purchase Agreement and subject to the conditions set forth therein, Newco will acquire from certain of the Sellers (the “Acquisition”) discrete assets and liabilities that comprise the multifamily business (collectively, the “Business”) of such Sellers.

Pursuant to the Asset Purchase Agreement, RealPage will pay approximately $300 million in cash, subject to reduction for outstanding indebtedness and unpaid transaction expenses and subject to a working capital adjustment, in exchange for the Business. RealPage will retain a portion of the purchase price as a holdback to serve as security for the benefit of RealPage and its affiliates in respect of the indemnification obligations of the Sellers. Subject to any indemnification claims made, the holdback will be released to the Sellers on or shortly after the first anniversary date of the closing of the Acquisition.

The Asset Purchase Agreement contains customary representations and warranties and covenants of RealPage, Newco and the Sellers. The Asset Purchase Agreement also contains customary closing conditions. The representations, warranties and covenants contained in the Asset Purchase Agreement were made only for purposes of the Asset Purchase Agreement and as of the specified dates set forth therein, were solely for the benefit of the parties to the Asset Purchase Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Asset Purchase Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors should not rely on the representations, warranties or covenants or any descriptions thereof as characterizations of the actual state of facts or conditions of RealPage, Newco or the Sellers or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Asset Purchase Agreement, which subsequent information may or may not be fully reflected in RealPage’s public disclosures.

The Asset Purchase Agreement includes certain termination rights that could be exercised by RealPage or the Sellers upon the occurrence of certain events, including the ability of RealPage or the Sellers to terminate the Asset Purchase Agreement in the event that the Acquisition has not closed on or prior to May 31, 2017 (subject to extension for up to 90 days in the event that the expiration or termination of the waiting period under applicable antitrust laws has not occurred). No party may terminate the Asset Purchase Agreement pursuant to the foregoing if the failure of the closing of the Acquisition to occur is due to the failure of such party to perform its obligations under the Asset Purchase Agreement. In addition, either RealPage or the Sellers may terminate the Asset Purchase Agreement if the other party breaches any representations, warranties, covenants or other agreements that would cause the obligations of such party not to be satisfied and such breach is not or cannot be cured by May 31, 2017.

Subject to satisfaction of the closing conditions included in the Asset Purchase Agreement and assuming that the Asset Purchase Agreement is not terminated, the Acquisition is expected to close in the second quarter of 2017.

The foregoing summary is qualified in its entirety by the full text of the Asset Purchase Agreement, which RealPage will file with the Securities and Exchange Commission as an exhibit to a forthcoming periodic financial report.

Third Amendment to Credit Agreement and Incremental Amendment

On February 27, 2017, RealPage entered into the Third Amendment to Credit Agreement and Incremental Amendment (the “Amendment”) among RealPage, the subsidiaries of RealPage party thereto, each of the lenders party thereto (the “Lenders”) and Wells Fargo Bank, National Association, as administrative agent (the “Agent”). The Amendment amends certain terms of RealPage’s Credit Agreement, dated as of September 30, 2014 (as amended, the “Credit Agreement”) to, among other things, provide for an incremental $200 million delayed draw term loan (the “Delayed Draw Term Loan”) that is available to be drawn until May 31, 2017, extend the maturity date of the Revolving Facility (as defined below) and term loans under the Credit Agreement to February 27, 2022 and amend the amortization schedule for the existing term loan under the Credit Agreement. With the new Delayed Draw Term Loan, the existing $125 million original principal amount term loan (the “Existing Term Loan”) and the existing $200 million revolving facility (the “Revolving Facility”), the Credit Agreement now includes $522,656,250 of drawn or available credit.

The proceeds of the Delayed Draw Term Loan may be used to finance acquisitions that are permitted under the terms of the Credit Agreement, including the Acquisition. Except as amended, all of the existing terms of the Credit Agreement remain in effect. As of February 27, 2017, there was $122,656,250 in aggregate principal amount outstanding under the Existing Term Loan and no amounts drawn under the Delayed Draw Term Loan or the Revolving Facility. All of the obligations of the Credit Agreement, including the Delayed Draw Term Loan once drawn, are secured by substantially all of RealPage’s assets and guaranteed by RealPage’s existing and future domestic subsidiaries, except certain excluded subsidiaries, as provided in the Credit Agreement.

On February 15, 2017, RealPage entered into the Second Amendment to Credit Agreement, which modified the definitions of Consolidated EBITDA and Pro Forma Basis to provide additional adjustments to financial calculations under the Credit Agreement, and provided that RealPage could request increased incremental commitments for the revolver and term loans thereunder in an aggregate principal amount of up to $150,000,000 plus an amount that would not cause RealPage's consolidated net leverage ratio to exceed 3.25 to 1.00, calculated on a pro forma basis, subject to customary conditions terms and conditions. Such amendment was determined not to be material to RealPage.  The foregoing description of the Second Amendment is qualified in its entirety by the full text of the Second Amendment, which RealPage will file with the Securities and Exchange Commission as an exhibit to a forthcoming periodic financial report.

Certain of the lenders under the Credit Agreement and their affiliates have engaged in, and may in the future engage in, investment banking and other commercial dealings in the ordinary course of business with RealPage or RealPage’s affiliates. They have received, or may in the future receive, customary fees and commissions for these transactions.

Additional details of the Credit Agreement were previously disclosed in RealPage’s Current Reports on Form 8-K filed with the Securities and Exchange Commission on October 1, 2014 and February 26, 2016, and are incorporated herein by reference.

The foregoing description of the Amendment is qualified in its entirety by the full text of the Amendment, which RealPage will file with the Securities and Exchange Commission as an exhibit to a forthcoming periodic financial report.

Item 2.03Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth under the heading “Third Amendment to Credit Agreement and Incremental Amendment” of Item 1.01, “Entry into a Material Definitive Agreement,” is incorporated herein by reference.

Item 7.01. Regulation FD Disclosure.

On February 27, 2017, RealPage issued a press release announcing that it had entered into the Asset Purchase Agreement. A copy of the press release is furnished herewith as Exhibit 99.1.

The information furnished under Item 7.01 of this Current Report on Form 8-K shall be deemed “furnished” and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, and shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
99.1	RealPage, Inc. Press Release dated February 27, 2017

Exhibit 99.1 attached hereto shall be deemed “furnished” and not “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section, and shall not be incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

SIGNATURE

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

	REALPAGE, INC.
By:	/s/ Stephen T. Winn
	Stephen T. Winn Chief Executive Officer, President and Chairman

Date: February 27, 2017

Exhibit Index

Exhibit No.	Description
99.1	RealPage, Inc. Press Release dated February 27, 2017

EX-99.1

RealPage® to Acquire Lease Rent Options, LRO®

Expands Rental Housing Asset Optimization Solutions

RICHARDSON, Texas (BUSINESS WIRE) RealPage, Inc. (NASDAQ: RP) today announced its agreement to acquire Lease Rent Options (LRO) and related assets from The Rainmaker Group for $300 million in cash. LRO is a revenue management solution that empowers optimized pricing for over 1.5 million apartments. LRO, coupled with the recent acquisition of Axiometrics, expands RealPage's suite of solutions for precision data analytics and asset optimization for the rental housing industry.

Highlights

• Better positions RealPage to penetrate an emerging global market opportunity to optimize operational and transactional yields for rental housing assets.

• Expands the company’s real­time lease transaction data, which is expected to improve optimization of new and renewal prices for rental housing leases.

• Provides additional data science talent and data modeling tools that allow for better harvesting and placement of capital in the rental housing industry.

• The industry is ripe for adoption: RealPage estimates that less than 10% of owners and operators of the 45 million rental housing properties in the U.S. currently utilize data­driven pricing science. International markets are believed to possess an even lower rate of adoption for asset optimization software and data analytic solutions.

• Adds 500,000 new units opening up cross selling opportunities for other products and services offered by RealPage.

Steve Winn, Chairman and CEO of RealPage

“With many apartment markets softening around the U.S., now is the right time to bring together the best data­science talent, a comprehensive lease­transaction database, and RealPage's powerful suite of pricing, demand and credit optimization tools into one comprehensive platform. Price optimization creates real opportunity to increase asset values and yields from the nearly $3.0 trillion of apartment stock in the U.S. that turns over at approximately $150 billion per year. As revenue management becomes more broadly accepted, we expect our combined platform to drive accelerated, sustained revenue growth in our Asset Optimization product family over the long­term. We believe we have all of the components necessary to offer solutions that bring efficiency and precision to the apartment real estate sector which has historically lacked the solutions available in other investment classes.”

Bryan Hill, CFO and Treasurer of RealPage

“The acquisition of LRO fits within our capital allocation strategy of generating the highest risk­adjusted returns for our shareholders. We expect the acquisition to be immediately accretive to our adjusted EBITDA margin, contributing to our ongoing objective to expand adjusted EBITDA margin approximately 200 basis points per year. The transaction will be financed through an expanded debt arrangement with our current bank syndicate.”

Financial and Operational Highlights

The completion of the acquisition remains subject to certain standard conditions, and is expected to close during the second quarter of 2017. The acquisition purchase price of approximately $300 million in cash is subject to working capital adjustments and post­acquisition indemnification claims. For the year ended December 31, 2016, the LRO business possessed revenue and EBITDA of $35.6 million and $10 million, respectively. Integration work is expected to be completed in 2018 and RealPage expects to achieve incremental revenue and expense synergies that will be accretive to its long term revenue growth objectives and Adjusted EBITDA margin expansion.

Bruce Barfield, CEO and Founder, and Tammy Farley, COO and Founder, are expected to remain with The Rainmaker Group to run the gaming and hospitality division, but have agreed to work closely with RealPage during a transition period immediately after the acquisition is closed.

About RealPage, Inc.

RealPage is a leading global provider of software and data analytics to the real estate industry. Clients use our platform to improve operating performance and increase capital returns. Founded in 1998 and headquartered in Richardson, Texas, RealPage currently serves over 11,000 clients worldwide from offices in North America, Europe and Asia. For more information about the company, visit https://www.realpage.com.

About Rainmaker

The Rainmaker Group is a market­leading provider of automated Revenue Management and profit optimization solutions in several industries. With more than 14 years of expertise in Revenue Management, Rainmaker employs a team of industry and technical experts that share a passion for analytics and technology. The company leverages cutting­edge research in order to bring customers the most sophisticated solutions to their revenue management challenges.

Cautionary Statement Regarding Forward­Looking Statements

This press release contains “forward­looking” statements relating to RealPage, Inc.'s financial outlook, expected, possible or assumed future results and RealPage's long­term revenue and adjusted EBITDA margin goals. These forward­looking statements are based on management's beliefs and assumptions and on information currently available to management. Forward­looking statements include all statements that are not historical facts and may be identified by terms such as “expects,” “believes,” “plans,” or similar expressions and the negatives of those terms. Those forward­looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward­looking statements. The company may be required to revise its results upon finalizing its review of quarterly and full year results, which could cause or contribute to such differences. Additional factors that could cause or contribute to such differences include, but are not limited to, the following: (a) the possibility that general economic conditions, including leasing velocity or uncertainty, could cause information technology spending, particularly in the rental housing industry, to be reduced or purchasing decisions to be delayed; (b) an increase in insurance claims; (c) an increase in customer cancellations; (d) the inability to increase sales to existing customers and to attract new customers; (e) RealPage, Inc.'s failure to integrate LRO or other acquired businesses and any future acquisitions successfully or to achieve expected synergies; (f) the timing and success of new product

introductions by RealPage, Inc. or its competitors; (g) changes in RealPage, Inc.'s pricing policies or those of its competitors; (h) legal or regulatory proceedings; (i) the inability to achieve revenue growth or to enable margin expansion; and (j) such other risks and uncertainties described more fully in documents filed with or furnished to the Securities and Exchange Commission (“SEC”) by RealPage Inc., including its Quarterly Report on Form 10­Q previously filed with the SEC on November 8, 2016. All information provided in this release is as of the date hereof and RealPage Inc. undertakes no duty to update this information except as required by law.

Contacts

RealPage

Rhett Butler, 972­820­3773

RealPageMediaRelations@realpage.com