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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i) (1) and 0-11.
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(1)
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Title of each class of securities to which transaction applies:
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(2)
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Aggregate number of securities to which transaction applies:
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(3)
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11
(set forth the amount on which the filing fee is calculated and state how it was determined): |
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(4)
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Proposed maximum aggregate value of transaction:
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(5)
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Total fee paid:
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Fee paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement No.:
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(3)
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Filing Party:
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(4)
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Date Filed:
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Proxy Statement
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Cordially,
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H. Eric Bolton, Jr.
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Chairman of the Board of Directors and Chief Executive Officer
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DATE:
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Tuesday, May 22, 2018
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TIME:
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11:00 a.m., local time
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PLACE:
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MAA Corporate Headquarters
6815 Poplar Avenue, Suite 500
Germantown, Tennessee 38138
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1. |
Election of the 12 directors named herein to serve for one year and until their successors have been duly elected and qualified;
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2. |
An advisory (non-binding) vote to approve the compensation of our named executive officers as disclosed in the accompanying Proxy Statement;
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3. |
To approve the Second Amended and Restated Mid-America Apartment Communities, Inc. 2013 Stock Incentive Plan; and
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4. |
Ratification of Ernst & Young LLP as our independent registered public accounting firm for 2018.
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By Order of the Board of Directors
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Leslie B.C. Wolfgang
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Senior Vice President,
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Chief Ethics and Compliance Officer, and Corporate Secretary
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1
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|||
2
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|||
3
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|||
3
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5
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11
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|||
13
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16
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23
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26
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26
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27
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28
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28
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34
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|||
35
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40
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42
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|||
53
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59
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59
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60
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68
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|||
81
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|||
83
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|||
83
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|||
83
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84
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|||
85
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86
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87
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91
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|||
93
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A-1
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|||
B-1
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BOARD |
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RECOMMENDATION |
PROPOSAL 1:
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ELECTION OF DIRECTORS
See full discussion beginning on Page 13
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FOR each
Nominee
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The Board and Nominating and Corporate Governance Committee believe that the 12 director nominees will effectively represent the long-term interests of shareholders through their oversight and quality counsel to MAA’s management reflecting their extensive and diverse business experience and acumen.
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PROPOSAL 2:
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ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION
See full discussion beginning on Page 27
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FOR
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This is a non-binding advisory vote to approve the compensation of MAA’s Named Executive Officers as outlined in this Proxy Statement. The Board and Compensation Committee value the opinions of our shareholders and will take into account the outcome of this vote when considering future compensation decisions.
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PROPOSAL 3:
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APPROVE SECOND AMENDED AND RESTATED STOCK INCENTIVE PLAN
See full discussion beginning on Page 60
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FOR
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The Board and Compensation Committee believe that utilizing equity incentive plans with awards tied to the successful execution of pre-determined performance goals is in the best long-term interest of shareholders as it better aligns employees’ focus and efforts with shareholder interests. We are seeking shareholder approval of an amended and restated stock incentive plan to, among other things, increase the number of shares available for issuance under the plan to 2,000,000 shares, in order to continue to attract and retain key individuals essential to MAA’s long-term strength and success.
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PROPOSAL 4:
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RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
See full discussion beginning on Page 86
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FOR
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As a matter of good corporate governance, we are asking our shareholders to ratify the selection of our independent audit firm. The Board and Audit Committee believe that the appointment of Ernst & Young LLP as MAA’s independent audit firm for fiscal year 2018 is in the best long-term interests of MAA and our shareholders.
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CORPORATE
GOVERNANCE
GUIDELINES
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Reflects the principles by which MAA and the Board operate and includes detailed specifications for director qualification, board responsibilities, share ownership requirements for directors and named executive officers, and equity retention requirements for named executive officers.
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CODE OF
CONDUCT
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Applicable to our executive officers, including the Chief Executive Officer, or CEO, and Chief Financial Officer, or CFO, as well as our directors and all employees. We intend to post amendments to or waivers from our Code of Conduct (to the extent applicable to our CEO, Principal Financial Officer or Principal Accounting Officer) on our website. No waivers to the Code of Conduct have been made as of the date of this Proxy Statement.
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WHISTLEBLOWER
POLICY
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Sets forth the procedures established by the Audit Committee for (i) the receipt, retention and treatment of complaints received by MAA regarding accounting, internal accounting controls or auditing matters; and (ii) the confidential, anonymous submission of concerns regarding questionable accounting and auditing matters.
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AUDIT
COMMITTEE
CHARTER
|
Outlines the duties and responsibilities of the committee in fulfilling its responsibility to oversee (i) the integrity of MAA’s financial statements, (ii) MAA’s compliance with legal and regulatory requirements, (iii) the independent public accounting firm’s qualification and independence; and (iv) the performance of MAA’s internal audit department and independent public accounting firm.
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COMPENSATION
COMMITTEE
CHARTER
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Outlines the duties and responsibilities of the committee in fulfilling its responsibilities to (i) discharge the responsibilities of the Board relating to compensation of MAA’s executive officers, (ii) establish compensation policies and incentive and equity-based award plans to attract, motivate and retain high quality leadership and compensate them in a manner consistent with the interests of MAA’s shareholders, (iii) oversee MAA’s risk assessment and risk management relative to compensation structures, (iv) review and discuss the Compensation Discussion & Analysis to be included in the Proxy Statement; and (v) provide the Compensation Committee Report for inclusion in the Proxy Statement that complies with the rules and regulations of the Securities and Exchange Commission, or SEC.
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NOMINATING
AND CORPORATE
GOVERNANCE
COMMITTEE
CHARTER
|
Outlines the duties and responsibilities of the committee to (i) provide assistance to the Board in identifying and recommending individuals qualified to serve as directors of MAA, (ii) review the composition of the Board, (iii) review and recommend corporate governance policies for MAA; and (iv) oversee the evaluation of the Board and management.
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REAL ESTATE
INVESTMENT
COMMITTEE
CHARTER
|
Outlines the duties and responsibilities of the committee to consider and approve or disapprove specific property acquisitions, dispositions or development projects for MAA.
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You can find a copy of all of the documents included in the above table by clicking on “Governance Documents” in the “Corporate Overview” section of the “For Investors” page on our website at http://ir.maac.com.
Information from our website is not incorporated by reference into this Proxy Statement.
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We will also provide a copy of any of the documents included in the above table without charge upon written request sent to: MAA, Attention: Investor Relations, 6815 Poplar Avenue, Suite 500, Germantown, Tennessee 38138.
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Committee Membership (4)
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Other
Public
Company
Boards
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|||||||
Name
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Age (3)
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Director
Since
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Primary Occupation
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A
|
C
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NCG
|
REI
|
|
H. Eric Bolton, Jr.
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61
|
1997
|
Chairman of the Board of Directors and Chief Executive Officer of MAA
|
XC
|
1
|
|||
Russell R. French (1)
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72
|
2016
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Special Limited Partner of Moseley & Co. VI, LLC and Class B Partner of Moseley & Co. VII, LLC and Moseley & Co. SBIC, LLC
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X
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-
|
|||
Alan B. Graf, Jr. (1)
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64
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2002
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Executive Vice President and Chief Financial Officer of FedEx Corporation
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L, XC
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1
|
|||
Toni Jennings (1)
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69
|
2016
|
Chairman of the Board of Jack Jennings & Sons, Inc. and Jennings & Jennings, Inc.
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X
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X
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2
|
||
James K. Lowder (1)
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68
|
2013
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Chairman of the Board of Directors of The Colonial Company
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X
|
X
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-
|
||
Thomas H. Lowder
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68
|
2013
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Past Chairman of the Board of Trustees and Chief Executive Officer of Colonial Properties Trust
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X
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-
|
|||
Monica McGurk (1)
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48
|
2016
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Past Chief Growth Officer of Tyson Foods, Inc.
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X
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X
|
-
|
||
Claude B. Nielsen (1)
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67
|
2013
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Chairman of the Board of Directors and Past Chief Executive Officer of Coca-Cola Bottling Company United, Inc.
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X
|
XC
|
-
|
||
Philip W. Norwood (1)
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70
|
2007
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Past President and Chief Executive Officer of Faison Enterprises, Inc.
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XC
|
X
|
X
|
-
|
|
W. Reid Sanders (1)
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68
|
2010
|
President of Sanders Properties, LLC and Sanders Investments, LLC
|
X
|
X
|
2
|
||
William B. Sansom (1) (2)
|
76
|
2006 – May 23,
2017 |
Chairman of the Board of Directors, Chief Executive Officer and President of H.T. Hackney Co.
|
|||||
Gary Shorb (1)
|
67
|
2012
|
Past President and Chief Executive Officer of Methodist Le Bonheur Healthcare
|
X
|
-
|
|||
David P. Stockert
|
56
|
2016
|
Past Chief Executive Officer of Post Properties, Inc.
|
X
|
1
|
· |
A director who is an employee or whose immediate family member is one of our executive officers is not independent until three years after the end of such employment relationship.
|
· |
A director who receives, or whose immediate family member receives, more than $120,000 per year in direct compensation from us, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service), is not independent until three years after he or she ceases to receive more than $120,000 per year in such compensation.
|
· |
A director who is affiliated with or employed by, or whose immediate family member is affiliated with or employed in a professional capacity by, any of our present or former internal or external auditors is not independent until three years after the end of the affiliation or the employment or auditing relationship.
|
· |
A director who is employed, or whose immediate family member is employed, as an executive officer of another company where any of our present executive officers serve on that company’s Compensation Committee is not independent until three years after the end of such service or the employment relationship.
|
· |
A director who is an executive officer or an employee, or whose immediate family member is an executive officer, of a company that makes payments to, or receives payments from, us for property or services in an amount which, in any single fiscal year, exceeds the greater of $1 million, or 2% of such other company’s consolidated gross revenues, is not independent until three years after falling below such threshold.
|
AUDIT COMMITTEE
|
|
Current Members:
Alan B. Graf, Jr.,
Chairman
Russell R. French
W. Reid Sanders
Gary Shorb
100% independent
composition
8 meetings in 2017
2 Audit Committee
Financial Experts (1):
Alan B. Graf, Jr.
Russell R. French
(1) Messrs. Graf and French meet the definitions of both Audit Committee financial expert under applicable SEC rules and independent director under applicable NYSE rules.
|
Committee Functions:
· appoints, determines the compensation of, oversees and evaluates the work of the independent registered public accounting firm;
· pre-approves all auditing services and permitted non-audit services, including the fees and terms thereof, to be performed by the independent registered public accounting firm;
· reviews and discusses with management and the independent registered public accounting firm the annual audited and quarterly unaudited financial statements and our disclosure under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Form 10-Qs and Form 10-Ks;
· discusses earnings press releases, including the use of “pro forma” or “adjusted” non-GAAP information, and discusses generally the financial information and earnings guidance which has been or will be provided to analysts and rating agencies;
· reviews and discusses with management and the independent registered public accounting firm the adequacy and effectiveness of our systems of internal accounting and financial controls;
· establishes procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters;
· reviews with management and the independent registered public accounting firm our compliance with the requirements for qualification as a REIT;
· reviews and reassesses annually the Audit Committee Charter and submits any recommended changes to the Board for its consideration; and
· issues a report annually as required by the SEC’s proxy solicitation rules.
|
COMPENSATION COMMITTEE
|
|
Current Members:
Philip W. Norwood,
Chairman
James K. Lowder
Toni Jennings
Monica McGurk
Claude B. Nielsen
100% independent
composition
4 meetings in 2017
|
Committee Functions:
· reviews and approves our compensation objectives;
· reviews and recommends the compensation programs, plans, and awards for the CEO to the Board and reviews and approves the same for the other executive officers, after taking into consideration any past “Say-on-Pay” votes by the shareholders;
· reviews and approves any employment and severance arrangements and benefits of the CEO and other executive officers;
· recommends to the Board how often MAA should submit to the shareholders the “Say-on-Pay” vote;
· recommends the compensation for directors to the Board;
· evaluates and oversees risks associated with the company’s compensation policies and practices;
· acts as administrator, as may be required, for our equity-related incentive plans;
· reviews and discusses with management the information contained in the Compensation Discussion & Analysis section of the Proxy Statement;
· assesses the independence of, retains and oversees compensation consultants, outside counsel and other advisors assisting the committee with the performance of its duties;
· reviews and reassesses annually the Compensation Committee Charter and recommends any proposed changes to the Board for approval; and
· issues a report annually related to executive compensation, as required by the SEC’s proxy solicitation rules.
|
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE
|
|
Current Members:
Claude B. Nielsen,
Chairman
Toni Jennings
Monica McGurk
James K. Lowder
Philip W. Norwood
100% independent
composition
3 meetings in 2017
|
Committee Functions:
· provides assistance and oversight in identifying qualified candidates to serve as members of the Board;
· reviews the qualification and performance of incumbent directors to determine whether to recommend them as nominees for re-election;
· reviews and considers candidates for directors who may be suggested by any director or executive officer, or by any shareholder if made in accordance with our charter, bylaws and applicable law;
· recommends to the Board members to serve on the committees of the Board;
· oversees the annual evaluation of the effectiveness of the current policies and practices of the Board and its committees;
· reviews and reassesses annually the Nominating and Corporate Governance Committee Charter and submits any proposed changes to the Board for approval; and
· reviews and recommends to the Board appropriate corporate governance principles that best serve the practices and objectives of the Board.
|
REAL ESTATE INVESTMENT COMMITTEE
|
|
Current Members:
H. Eric Bolton, Jr.,
Chairman
Thomas H. Lowder
Philip W. Norwood
W. Reid Sanders
David P. Stockert
5 meetings in 2017
|
Committee Functions:
· considers and approves or disapproves specific property acquisitions, dispositions or development projects within approval levels established annually by the Board;
· refers and makes a recommendation on proposed property acquisitions or development projects outside the approval levels established annually by the Board;
· reviews and reassesses annually the Real Estate Investment Committee Charter and submits to the Board any recommended changes; and
· approves disposition of individual properties not included in the annual strategic plan reviewed and approved by the Board.
|
ANNUAL CASH FEES
|
||||
SERVICE FEE
|
$65,000
|
Compensation for serving on the Board
|
||
LEAD INDEPENDENT DIRECTOR FEE
|
$20,000
|
Compensation for additional duties related to serving as the Lead Independent Director
|
||
AUDIT COMMITTEE CHAIRMAN FEE
|
$17,500
|
Compensation for additional duties related to serving as the Audit Committee Chairman
|
||
AUDIT COMMITTEE MEMBER FEE
|
$7,500
|
Compensation for additional duties related to serving as an Audit Committee Member (committee chairman does not receive this fee)
|
||
COMPENSATION COMMITTEE CHAIRMAN FEE
|
$15,000
|
Compensation for additional duties related to serving as the Compensation Committee Chairman
|
||
COMPENSATION COMMITTEE MEMBER FEE
|
$6,250
|
Compensation for additional duties related to serving as a Compensation Committee Member (committee chairman does not receive this fee)
|
||
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE CHAIRMAN FEE
|
$10,000
|
Compensation for additional duties related to serving as the Nominating and Corporate Governance Committee Chairman
|
||
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE MEMBER FEE
|
$3,750
|
Compensation for additional duties related to serving as a Nominating and Corporate Governance Committee Member (committee chairman does not receive this fee)
|
||
REAL ESTATE INVESTMENT COMMITTEE MEMBER FEE
|
$6,250
|
Compensation for additional duties related to serving as a Real Estate Investment Committee Member
|
||
ANNUAL GRANT OF SHARES OF RESTRICTED COMMON STOCK Made upon election to Board
|
||||
$120,000
|
Shares vest at the end of the director’s year of service on the Board.
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Name
|
Fees
Earned
or
Paid in
Cash
($)
(1)
|
Stock
Awards
($)
(2)
|
Option
Awards
($)
|
Non-Equity
Incentive Plan
Compensation
($)
|
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)
|
All Other
Compensation
($)
(3)
|
Total
($)
|
|||||||||||||||||||||
Russell R. French
|
$
|
70,000
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
6,497
|
$
|
196,429
|
||||||||||||||
Alan B. Graf, Jr.
|
$
|
97,500
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
87,792
|
$
|
305,224
|
||||||||||||||
Toni Jennings
|
$
|
72,500
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
192,432
|
||||||||||||||
James K. Lowder
|
$
|
70,937
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
190,869
|
||||||||||||||
Thomas H. Lowder
|
$
|
68,750
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
3,057
|
$
|
191,739
|
||||||||||||||
Monica McGurk
|
$
|
72,500
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
9,421
|
$
|
201,853
|
||||||||||||||
Claude B. Nielsen
|
$
|
78,750
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
23,677
|
$
|
222,359
|
||||||||||||||
Philip W. Norwood
|
$
|
87,500
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
51,808
|
$
|
259,240
|
||||||||||||||
W. Reid Sanders
|
$
|
76,250
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
19,851
|
$
|
216,033
|
||||||||||||||
William B. Sansom (4)
|
$
|
35,000
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
33,832
|
$
|
68,832
|
||||||||||||||
Gary Shorb
|
$
|
70,000
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
36,283
|
$
|
226,215
|
||||||||||||||
David P. Stockert
|
$
|
68,750
|
$
|
119,932
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
2,944
|
$
|
191,626
|
(1) |
This column represents annual director fees and committee chair and committee member fees regardless of whether they were paid as cash or deferred by the director and issued as phantom stock in MAA’s Non-Qualified Deferred Compensation Plan For Outside Company Directors.
|
(2) |
This column represents the full grant date fair value in accordance with FASB ASC Topic 718 in the year of the grant. The restricted common stock awards that were granted in 2017 include the following grants:
|
Name
|
Date of
Grant
|
Price
of
Grant
|
Number
of
Shares
|
Vesting
Schedule
|
2017
ASC 718
Expense
|
Full
Grant Date
Fair Value
|
|||||||||||||
Russell R. French
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
Alan B. Graf, Jr.
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
Toni Jennings
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
James K. Lowder
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
Thomas H. Lowder
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
Monica McGurk
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
Claude B. Nielsen
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
Philip W. Norwood
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
W. Reid Sanders
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
Gary Shorb
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
||||||||||
David P. Stockert
|
5/23/2017
|
$
|
100.11
|
1,198
|
100% on May 23, 2018
|
$
|
69,960
|
$
|
119,932
|
(3) |
This column represents the dividend reinvestment shares acquired in our Non-Qualified Deferred Compensation Plan For Outside Company Directors during the year.
|
(4) |
Mr. Sansom did not stand for re-election to the Board at the 2017 Annual Meeting of Shareholders.
|
MATTER TO BE VOTED
Election of the 12 directors named herein to serve for one year and until their successors have been duly elected and qualified.
|
Our Board proposes that H. Eric Bolton, Jr., Russell R. French, Alan B. Graf, Jr., Toni Jennings, James K. Lowder, Thomas H. Lowder, Monica McGurk, Claude B. Nielsen, Philip W. Norwood, W. Reid Sanders, Gary Shorb and David P. Stockert, all of whom are currently serving as directors, be elected for a term of one year and until their successors are duly elected and qualified. We have no reason to believe that any nominee for director will not agree or be available to serve as a director if elected. However, should any nominee become unable or unwilling to serve, the proxies may be voted for a substitute nominee or to allow the vacancy to remain open until filled by our Board.
|
|
VOTE REQUIRED
|
The presence of a quorum at the Annual Meeting, either in person or by written proxy, and the cast of more “For” votes than votes cast “Against” for each nominee are necessary at the meeting to elect a nominee as a director.
|
|
Impact of Abstentions and Broker Non-Votes
|
Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.
|
|
BOARD RECOMMENDATION
|
FOR
|
Our Board recommends a vote “FOR” each of the Director nominees.
|
H. ERIC BOLTON, JR.
Chairman of the Board and
Chief Executive Officer of MAA
|
Mr. Bolton joined MAA in 1994 as Vice President of Development and was named Chief Operating Officer in February 1996 and later promoted to President in December 1996. Mr. Bolton assumed the position of Chief Executive Officer in October 2001 and became Chairman of the Board in September 2002. Immediately prior to joining us, Mr. Bolton served as Executive Vice President and Chief Financial Officer of Trammell Crow Realty Advisors, for which he worked for more than five years. Prior to that, Mr. Bolton worked in the commercial banking industry for seven years.
|
Director since:
February 1997
Age: 61
Board Committees:
Real Estate Investment (Chairman)
Other Public Company Boards:
EastGroup Properties, Inc.
(2013–current)
|
Key Attributes, Experiences and Skills:
· Ethical, decisive and effective leadership
· Extensive business, operating and financial experience
· Tremendous knowledge of MAA and the multifamily real estate industry
· Additional depth to REIT and apartment experience and knowledge from service on the Advisory Board of Governors of NAREIT and the Executive Committee of the National Multifamily Housing Council
· Broad strategic vision for MAA
· Service as our Chairman and Chief Executive Officer creates a critical link between management and our Board, enabling our Board to perform its oversight function with the benefits of management's perspectives on the business
|
RUSSELL R. FRENCH
Special Limited Partner of
Moseley & Co. VI, LLC and
Class B Partner of
Moseley & Co. VII, LLC and
Moseley & Co. SBIC, LLC
|
Mr. French was appointed to the Board pursuant to the terms of the merger agreement between us and Post Properties, Inc., or Post. Mr. French has been a special limited partner of Moseley & Co. VI, LLC since 2007 and a Class B Partner of both Moseley & Co. VII, LLC and Moseley & Co. SBIC, LLC since 2014. In addition, Mr. French has been a member of Moseley & Co. V, LLC, the general partner of a venture capital fund, since 2000. Mr. French is a retired venture capitalist and was previously a member of Moseley & Co. III and a partner of Moseley & Co. II, positions he held for more than five years. Mr. French is an Emeritus Trustee of Emory University.
|
Director since:
December 2016
Age: 72
Board Committees:
Audit
Other Public Company Boards:
Post Properties, Inc.
(1993–2016)
|
Key Attributes, Experiences and Skills:
· Provides a breadth of knowledge in company oversight from his extensive experience in evaluating businesses across a range of industries
· Provides financial expertise including the evaluation of financial statements and long term company performance from his 30-year career as a venture capitalist
· Mr. French’s previous service on the Board of Directors of Post provides our Board with historical knowledge and perspective of the Post portfolio and promotes stability in our operations following our merger with Post.
|
ALAN B. GRAF, JR.
Executive Vice President and
Chief Financial Officer of
FedEx Corporation
|
Mr. Graf has been the Executive Vice President and Chief Financial Officer of FedEx Corporation since 1998 and is a member of FedEx Corporation’s Executive Committee. Mr. Graf served as Executive Vice President and Chief Financial Officer for FedEx Express, FedEx’s predecessor, from 1991 to 1998. Mr. Graf joined FedEx in 1980. Mr. Graf also serves on the boards of Methodist Le Bonheur Healthcare and the Indiana University Foundation and is a University of Memphis Trustee.
|
Director since:
June 2002
Age: 64
Board Committees:
Audit
(Chairman)
Other Public Company Boards:
NIKE, Inc.
(2002–current)
|
Key Attributes, Experiences and Skills:
· Offers valuable business leadership, management experience, and insight and guidance on strategic direction and growth opportunities from his 37-year career at FedEx Corporation
· Provides financial expertise including an understanding of financial statements, corporate finance, accounting and capital markets from his financial background and his service on the audit committee of NIKE, Inc.
|
TONI JENNINGS
Chairman of the
Board of Directors of
Jack Jennings & Sons, Inc. and
Jennings & Jennings, Inc.
|
Ms. Jennings was appointed to the Board pursuant to the terms of the merger agreement between us and Post. Ms. Jennings currently serves as the Chairman of the Board of Jack Jennings & Sons, Inc., a commercial construction firm, a position she has held for ten years. Ms. Jennings served as and was the first female Lieutenant Governor for the State of Florida from 2003 to 2007. Prior to that, Ms. Jennings served as President of Jack Jennings & Sons, Inc. from 1982 to 2003. During this time, Ms. Jennings also served in the Florida legislature, from 1976 to 2000, including 20 years in the Florida Senate where she served the last four years as Senate President.
|
Director since:
December 2016
Age: 69
Board Committees:
Compensation;
Nominating and Corporate
Governance
Other Public Company Boards:
Next Era Energy, Inc.
(2007-current);
Brown & Brown, Inc.
(2007-current & 1997-2003);
Post Properties, Inc.
(2011–2016)
|
Key Attributes, Experiences and Skills:
· Offers insight from her extensive legislative and political experience gained through four years of service as Lieutenant Governor of the State of Florida and 24 years in the Florida legislature
· Provides relevant business acumen from her 30 years of experience as an owner and operator of a successful industry-related business
· Ms. Jenning’s previous service on the Board of Directors of Post provides our Board of Directors with historical knowledge and perspective of the Post portfolio and promotes stability in our operations following our merger with Post.
|
JAMES K. LOWDER
Chairman of the
Board of Directors of
The Colonial Company
|
Mr. Lowder was appointed to the Board pursuant to the terms of the merger agreement between us and Colonial Properties Trust. Mr. Lowder has served as Chairman of the Board of The Colonial Company and its subsidiaries since 1995. Mr. Lowder is a member of the Home Builders Association of Alabama, the Greater Montgomery Home Builders Association, and serves on the Board of Directors of Alabama Power Company. James K. Lowder is the brother of Thomas H. Lowder, another one of our directors.
|
Director since:
October 2013
Age: 68
Board Committees:
Compensation;
Nominating and Corporate
Governance
Other Public Company Boards:
Colonial Properties Trust
(1993-2013)
|
Key Attributes, Experiences and Skills:
· Vast experience in the real estate development and construction industries in the Southeast
· Extensive knowledge of all phases of the commercial real estate industry and economic cycles
· Mr. Lowder’s previous service as a trustee for Colonial Properties Trust provides our Board with historical knowledge and perspective of the Colonial Properties Trust portfolio and promotes stability in our operations following our merger with Colonial Properties Trust
|
THOMAS H. LOWDER
Past Chairman of the
Board of Trustees and
Chief Executive Officer of
Colonial Properties Trust
|
Mr. Lowder was appointed to the Board pursuant to the terms of the merger agreement between us and Colonial Properties Trust. Mr. Lowder served as the Chairman of the Board of Trustees for Colonial Properties Trust from 1993 to October 2013 and as the Chief Executive Officer from 1993 to 2006 and again from 2008 to 2013. Mr. Lowder became President and Chief Executive Officer of Colonial Properties, Inc., Colonial Properties Trust’s predecessor, in 1976. Mr. Lowder also serves on the boards of Children's Hospital of Alabama, and Crippled Children's Foundation. Thomas H. Lowder is the brother of James K. Lowder, another one of our directors.
|
Director since:
October 2013
Age: 68
Board Committees:
Real Estate Investment
Other Public Company Boards:
Colonial Properties Trust
(1993-2013)
|
Key Attributes, Experiences and Skills:
· Depth of experience in the acquisition, development, management, and disposition of multifamily, office and retail properties
· Tremendous knowledge of the markets in which we operate
· Mr. Lowder’s previous service as Chief Executive Officer and Chairman of the Board for Colonial Properties Trust provides our Board with historical knowledge and perspective of the Colonial Properties Trust portfolio and promotes stability in our operations following our merger with Colonial Properties Trust
|
MONICA McGURK
Past Chief Growth Officer of
Tyson Foods, Inc.
|
Ms. McGurk served as the Chief Growth Officer for Tyson Foods, Inc. through September 2017, having previously joined the company in 2016 as Executive Vice President of Strategy and New Ventures & President of Foodservice. Prior to joining Tyson Foods, Inc., Ms. McGurk worked for The Coca-Cola Company as Senior Vice President, Strategy, Decision Support and eCommerce, North America Group from 2014 to 2016, and as Vice President, Strategy & eCommerce from 2012 to 2014. Prior to her employment with The Coca-Cola Company, Ms. McGurk served for eight months as the Chief Executive Officer of The Alumni Factor, a digital media and information services start up. From 1992 to 2012, Ms. McGurk served in a variety of roles at McKinsey & Company, a global management consulting firm, including eight years as a partner.
|
Director since:
March 2016
Age: 48
Board Committees:
Compensation;
Nominating and Corporate
Governance
Other Public Company Boards:
None
|
Key Attributes, Experiences and Skills:
· Offers valuable guidance on corporate strategy development, consumer analysis and marketing and eCommerce from her career with Tyson Foods, Inc., The Coca-Cola Company and McKinsey & Company
· Provides valuable insight and guidance on how opportunities for enhanced branding and growth in web-based services and new technologies will continue to impact our platform and operations
|
CLAUDE B. NIELSEN
Chairman of the
Board of Directors of
Coca-Cola Bottling Company
United, Inc.
|
Mr. Nielsen was appointed to the Board pursuant to the terms of the merger agreement between us and Colonial Properties Trust. Mr. Nielsen has served as Chairman of the Board of Directors for Coca-Cola Bottling Company United, Inc. since 2003. Mr. Nielsen served as chief executive officer of Coca-Cola Bottling Company United, Inc. from 1991 to his planned retirement in 2016. Mr. Nielsen had been appointed as president in 1990. Prior to 1990, Mr. Nielsen served as president of Birmingham Coca-Cola Bottling Company. Mr. Nielsen is currently a board member of the Birmingham Business Alliance.
|
Director since:
October 2013
Age: 67
Board Committees:
Compensation;
Nominating and Corporate
Governance (Chairman)
Other Public Company Boards:
Colonial Properties Trust
(1993-2013);
|
Key Attributes, Experiences and Skills:
· Unique perspective and insight as an experienced participant in the financial services and beverage industries
· Extensive experience in the capital markets from his executive leadership of the Coca-Cola Bottling Company United, Inc. and his tenure as a director of Regions Financial Corporation
· Mr. Nielsen’s previous service as a trustee for Colonial Properties Trust provides our Board with historical knowledge and perspective of the Colonial Properties Trust portfolio and promotes stability in our operations following our merger with Colonial Properties Trust
|
PHILIP W. NORWOOD
Past President and
Chief Executive Officer of
Faison Enterprises, Inc.
|
Mr. Norwood is a Principal of Haviland Capital, LLC, an investment company. Mr. Norwood served as the President and Chief Executive Officer of Faison Enterprises, Inc., a real estate development and investment company, from 1994 until his retirement in March 2013. Prior to joining Faison Enterprises, Inc., Mr. Norwood held several positions for Trammell Crow Company. Mr. Norwood is a member of several real estate associations and serves as the Chairman of the Board of Directors for Pacolet Milliken Enterprises, Inc.
|
Director since:
August 2007
Age: 70
Board Committees:
Compensation
(Chairman);
Nominating and Corporate
Governance;
Real Estate Investment
Other Public Company Boards:
None
|
Key Attributes, Experiences and Skills:
· Extensive and in-depth real estate knowledge and experience, as well as capital markets and financial expertise from his 37-year career in the real estate industry and extensive participation in some of the most prominent real estate associations
· Astute insight into operational and strategic matters as well as potential acquisitions and divestitures
· Industry specific operational experience, making him uniquely qualified to serve as the Chairman of the Compensation Committee as he has a keen understanding of executive compensation, its impact on recruitment and retention and the alignment of management and shareholder interests
|
W. REID SANDERS
President of
Sanders Properties, LLC and
Sanders Investments, LLC
|
Mr. Sanders is the Co-Founder and served as the Executive Vice President of Southeastern Asset Management, and the President of Longleaf Partners Funds, from 1975 to 2000. Prior to 1975, Mr. Sanders served as an investment officer and worked in credit analysis and commercial lending in the banking industry from 1971 to 1975. Mr. Sanders currently serves on the Board of Directors, Compensation Committee and Executive Committee for Independent Bank, serves on the Investment Committee at Cypress Realty, a limited partnership involved in commercial real estate, and is on the Advisory Board of SSM Venture Partners III, L.P.
|
Director since:
March 2010
Age: 68
Board Committees:
Audit;
Real Estate Investment
Other Public Company Boards:
Two Harbors Investment Corp.
(2009-current);
Granite Point Mortgage (2017-current);
Silver Bay Realty Trust Corp.
(2016-2017)
|
Key Attributes, Experiences and Skills:
· Financial expertise and valuable insight into the capital markets from his 42-year career in the financial industry
· Valuable insights regarding the evaluation of potential acquisitions and divestitures from his service on the Investment Committee of a commercial real estate limited partnership
· Mr. Sanders’ understanding of financial statements, corporate finance, and accounting makes him a valued member of the Audit Committee
|
GARY SHORB
Past President and
Chief Financial Officer of
Methodist Le Bonheur Healthcare
|
Mr. Shorb served as the President and Chief Executive Officer of Methodist Le Bonheur Healthcare, an integrated healthcare system that comprises a 7-hospital operation, from 2001 to his planned retirement in 2016. Mr. Shorb served as a Senior Advisor to the Chief Executive Officer through April 2017. Mr. Shorb joined Methodist Le Bonheur Healthcare in 1990 as Executive Vice President. Before joining Methodist Le Bonheur Healthcare, Mr. Shorb served as President of the Regional Medical Center in Memphis, Tennessee for 4 years. Prior to his work in the healthcare industry, Mr. Shorb worked as a project engineer with Exxon and served as a Lieutenant Commander in the U.S. Navy. Mr. Shorb serves on a number of civic and non-profit boards and is currently serving as the Executive Director of The Urban Child Institute.
|
Director since:
May 2012
Age: 67
Board Committees:
Audit
Other Public Company Boards:
None
|
Key Attributes, Experiences and Skills:
· Offers valuable business leadership with expertise and experience in organizational development, management and business finance from his long career at Methodist Le Bonheur Healthcare and senior leadership positions held prior to joining Methodist Le Bonheur Healthcare
· Insights and experience directly attributable to our service-based operations from his experience as the Chief Executive Officer of a large consumer and service-based operation
|
DAVID P. STOCKERT
Past Chief Executive
Officer and President of
Post Properties, Inc.
|
Mr. Stockert was appointed to the Board pursuant to the terms of the merger agreement between us and Post. Mr. Stockert served as Chief Executive Officer and President of Post from 2002 to 2016 and as President and Chief Operating Officer from 2001 to 2002. Prior to joining Post, Mr. Stockert served as Executive Vice President of Duke Realty Corporation from 1999 to 2000, and as Senior Vice President and Chief Financial Officer of Weeks Corporation from 1995 to 1999. Prior to joining Weeks Corporation, Mr. Stockert was an investment banker and a certified public accountant. Mr. Stockert currently serves on multiple civic and charitable organizations in the Atlanta area.
|
Director since:
December 2016
Age: 56
Board Committees:
Real Estate Investment
Other Public Company Boards:
Duke Realty Corporation
(2017-current);
Post Properties, Inc.
(2002–2016)
|
Key Attributes, Experiences and Skills:
· Depth of experience in the acquisition, development, management, and sale of multifamily, office and retail properties
· Provides a breadth of industry knowledge having spent 26 years of his career working for three publically-traded REITs, and serving on the board of another REIT
· Mr. Stockert’s previous service as Chief Executive Officer for Post provides our Board with historical knowledge and perspective of the Post portfolio and promotes stability in our operations following our merger with Post.
|
STOCK OWNERSHIP
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
|
Name and Address
of Beneficial Owner
|
Amount and
Nature of
Beneficial
Ownership
|
Percent
of Class
|
Notes
|
||||||
The Vanguard Group
100 Vanguard Blvd.
Malvern, PA 19355
|
20,250,800
|
17.8%
|
|
The Schedule 13G indicates the entity has sole power to vote or to direct the vote for 289,042 shares, shared power to vote or to direct the vote for 165,568 shares, sole power to dispose or to direct the disposition of 19,932,913 shares, and shared power to dispose or to direct the disposition of 317,887 shares. The shares indicated include the 7,649,289 shares beneficially owned by Vanguard Specialized Funds – Vanguard REIT Index Fund, an affiliate of Vanguard Group, Inc.
|
|||||
Vanguard Specialized Funds
- Vanguard REIT Index Fund
100 Vanguard Blvd.
Malvern, PA 19355
|
7,649,289
|
6.7%
|
|
The Schedule 13G indicates the entity has sole power to vote or to direct the vote for 7,649,289 shares. The shares indicated are included in the 20,250,800 shares beneficially owned by The Vanguard Group, Inc. and should not be added to those shares to indicate total beneficial ownership by The Vanguard Group, Inc.
|
|||||
BlackRock, Inc.
55 East 52nd St
New York, NY 10055
|
11,003,658
|
9.7%
|
|
The Schedule 13G indicates the entity has sole power to vote or to direct the vote for 10,029,929 shares and sole power to dispose or to direct the disposition of 11,003,658 shares.
|
|||||
State Street Corporation
State Street Financial Center
One Lincoln Street
Boston, MA 02111
|
6,466,649
|
5.7%
|
|
The Schedule 13G indicates the entity has shared power to vote or to direct the vote for 6,466,649 shares, and shared power to dispose or to direct the disposition of 6,466,649 shares.
|
Name of Beneficial
Owner
|
Aggregate
Number of
Shares
Beneficially
Owned
|
Percent of Class
|
Notes
|
|||
H. Eric Bolton, Jr. (2)
|
339,308
|
(1)
|
Includes 110,000 shares that Mr. Bolton has the current right to acquire upon redemption of limited partnership units; 7,943 shares attributed to Mr. Bolton in our Employee Stock Ownership Plan; and 9,139 shares owned in a joint account with his wife for which Mr. Bolton has shared voting and investment power.
|
|||
Albert M. Campbell, III
|
54,134
|
(1)
|
Includes 2,833 shares attributed to Mr. Campbell in our Employee Stock Ownership Plan; and 1,100 shares of which Mr. Campbell has shared voting and investment power (100 shares held by Mr. Campbell through an individual retirement account, and 1,000 shares Mr. Campbell owns in a joint account with his wife).
|
|||
Robert J. DelPriore
|
26,000
|
(1)
|
||||
Russell R. French (2)
|
25,739
|
(1)
|
Includes 2,976 shares held in a deferred compensation account.
|
|||
Alan B. Graf, Jr. (2)
|
36,970
|
(1)
|
Includes 26,642 shares held in a deferred compensation account.
|
|||
Thomas L. Grimes, Jr.
|
54,160
|
(1)
|
Includes 3,575 shares attributed to Mr. Grimes in our Employee Stock Ownership Plan; and 1,311 shares owned by Mr. Grimes’ spouse in our Employee Stock Ownership Plan.
|
|||
Toni Jennings (2)
|
4,737
|
(1)
|
||||
James K. Lowder (2)
|
238,886
|
(1)
|
Includes 233,716 shares that Mr. Lowder has the current right to acquire upon redemption of limited partnership units, as to 4,990 of which Mr. Lowder would have shared voting and investment power (4,990 owned by JKL Investments, LLC); 208,726 of the limited partnership units owned by Mr. Lowder are pledged as collateral on various loans.
|
Name
|
Aggregate
Number of
Shares
Beneficially
Owned
|
Percent of
Class
|
Notes
|
|||
Thomas H. Lowder (2)
|
281,311
|
(1)
|
Includes 248,654 shares that Mr. Lowder has the current right to acquire upon redemption of limited partnership units, 19,928 of which Mr. Lowder would have shared voting and investment power (19,928 owned by THL Investments, LLC); 1,339 shares held in a deferred compensation account; 25,791 shares held by Mr. Lowder through an individual retirement account for which Mr. Lowder has shared voting and investment power; and 357 shares indirectly owned by Mr. Lowder (357 shares owned by THL Investments, LLC).
|
|||
Monica McGurk (2)
|
3,858
|
(1)
|
Includes 3,858 shares held in a deferred compensation account.
|
|||
Claude B. Nielsen (2)
|
31,780
|
(1)
|
Includes 2,111 shares that Mr. Nielsen has the current right to acquire upon redemption of limited partnership units; 7,628 shares held in a deferred compensation account; and 3,423 shares that Mr. Nielsen has the right to acquire upon the exercise of options.
|
|||
Philip W. Norwood (2)
|
23,993
|
(1)
|
Includes 15,906 shares held in a deferred compensation account.
|
|||
W. Reid Sanders (2)
|
140,072
|
(1)
|
Includes 107,000 shares that Mr. Sanders has the current right to acquire upon redemption of limited partnership units; 6,363 shares held in a deferred compensation account; 6,000 shares held by Mr. Sanders through an individual retirement account for which Mr. Sanders has shared voting and investment power; and 7,600 shares Mr. Sanders holds indirectly and for which he has shared voting and investment power, of which 5,900 shares Mr. Sanders has authority to vote as trustee or through a power-of-attorney and 1,700 shares owned by Mr. Sanders’ spouse.
|
|||
Gary Shorb (2)
|
16,555
|
(1)
|
Includes 11,805 shares held in a deferred compensation account.
|
|||
David P. Stockert (2)
|
159,915
|
(1)
|
Includes 1,915 shares held in a deferred compensation account; 53,812 shares owned by Mr. Stockert’s spouse and 27,008 shares that Mr. Stockert has the right to acquire upon the exercise of options.
|
|||
All Directors, Director Nominees and Executive Officers as a group (15 persons)
|
1,437,418
|
1.26%
|
Includes 701,481 shares that may be acquired upon redemption of limited partnership units; 78,432 shares held in deferred compensation accounts; 15,662 shares held in our Employee Stock Ownership Plan; and 30,431 shares that may be acquired upon the exercise of options.
|
(1) |
Represents less than 1% of the total.
|
(2) |
Director nominee.
|
Name and Position
|
Age
|
Experience
|
||
H. Eric Bolton, Jr.
Chairman of the Board
and Chief Executive Officer
|
61
|
Mr. Bolton joined us in 1994 as Vice President of Development and was named Chief Operating Officer in February 1996 and promoted to President in December 1996. Mr. Bolton assumed the position of Chief Executive Officer in October 2001 and became Chairman of the Board in September 2002. Prior to joining us, Mr. Bolton was with Trammell Crow Company for more than five years, and was Executive Vice President and Chief Financial Officer of Trammell Crow Realty Advisors. Prior to that, Mr. Bolton worked in the commercial banking industry for seven years.
|
||
Albert M. Campbell, III
Executive Vice President
and Chief Financial Officer
|
51
|
Prior to his appointment as Chief Financial Officer in January 2010, Mr. Campbell served as our Executive Vice President, Treasurer and Director of Financial Planning and was responsible for managing the funding requirements of the business to support corporate strategy. Mr. Campbell joined us in 1998 and was initially responsible for external reporting and financial planning. Prior to joining us, Mr. Campbell worked as a Certified Public Accountant with Arthur Andersen and served in various finance and accounting roles with Thomas & Betts Corporation.
|
||
Robert J. DelPriore
Executive Vice President
and General Counsel
|
50
|
Mr. DelPriore joined us in August 2013 as our Executive Vice President and General Counsel. Prior to joining us, Mr. DelPriore was a partner in the securities department of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC from February 2008 through August 2013; during which time he served as counsel to MAA. Prior to that, Mr. DelPriore was a partner in the corporate securities group of Bass, Berry & Sims PLC; during which time he served as counsel to MAA.
|
||
Thomas L. Grimes, Jr.
Executive Vice President
and Chief Operating Officer
|
49
|
Mr. Grimes was promoted to Chief Operating Officer in December 2011, having previously served as Executive Vice President and Director of Property Management. Prior to this position, Mr. Grimes served us as an Operations Director over the Central and North Regions. Mr. Grimes also served as Director of Business Development where he worked with our joint venture partners, managed our new development efforts and directed our ancillary income business. Mr. Grimes joined us in 1994.
|
MATTER TO BE VOTED
An advisory (non-binding) vote to approve the compensation of our named executive officers as disclosed in this Proxy Statement.
|
Section 14A of the Exchange Act requires that we provide our shareholders with the opportunity to vote to approve, on a non-binding, advisory basis, the compensation of our “named executive officers”. Therefore, shareholders are asked to approve the compensation paid to our named executive officers as disclosed in this Proxy Statement pursuant to the SEC’s compensation disclosure rules, including the Compensation Discussion & Analysis, the compensation tables and the accompanying narrative discussion included in this Proxy Statement.
|
|||
VOTE REQUIRED
|
For the advisory (non-binding) vote on the compensation of our named executive officers to be approved, the votes cast “For” the proposal must exceed the votes cast “Against” the proposal. The vote under this proposal is advisory, and therefore, not binding on us, our Board or the Compensation Committee. However, our Board, including the Compensation Committee, values the opinions of our shareholders and, to the extent there is any significant vote against the named executive officer compensation as disclosed in this Proxy Statement, we will consider our shareholders’ concerns and evaluate what actions may be appropriate to address those concerns.
|
|||
Impact of Abstentions and Broker Non-Votes
|
Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.
|
|||
BOARD
RECOMMENDATION
|
FOR
|
Our Board recommends a vote “FOR” the advisory (non-binding) vote to approve the compensation of our named executive officers as disclosed in this Proxy Statement.
|
INTRODUCTION
|
Name
|
Title
|
|
H. Eric Bolton, Jr.
|
Chairman of the Board and Chief Executive Officer
|
|
Albert M. Campbell, III
|
Executive Vice President and Chief Financial Officer
|
|
Robert J. DelPriore
|
Executive Vice President and General Counsel
|
|
Thomas L. Grimes, Jr.
|
Executive Vice President and Chief Operating Officer
|
· |
fair and equitable when viewed both internally and externally;
|
· |
competitive in order to attract and retain the best qualified individuals; and
|
· |
aligned with performance.
|
2017 Total Shareholder Return
|
Base Salary
|
Percent
|
|||||||||||
2017
|
2016
|
Increase
|
||||||||||
Mr. Bolton
|
$
|
704,000
|
$
|
640,000
|
10.0
|
%
|
||||||
Mr. Campbell
|
$
|
440,000
|
$
|
400,000
|
10.0
|
%
|
||||||
Mr. DelPriore
|
$
|
429,000
|
$
|
390,000
|
10.0
|
%
|
||||||
Mr. Grimes
|
$
|
451,000
|
$
|
410,000
|
10.0
|
%
|
2017 Annual Bonus Paid in 2018
|
||||||||||||
Cash
Amount
|
Percent of 2017
Base Salary
|
Percent of Maximum
Opportunity Earned
|
||||||||||
Mr. Bolton
|
$
|
1,536,480
|
218
|
%
|
87
|
%
|
||||||
Mr. Campbell
|
$
|
580,635
|
132
|
%
|
88
|
%
|
||||||
Mr. DelPriore
|
$
|
574,163
|
134
|
%
|
89
|
%
|
||||||
Mr. Grimes
|
$
|
640,591
|
142
|
%
|
71
|
%
|
Maximum
|
Earned to Date
|
Additional
Shares
|
||||||||||||||
Potential
Shares
|
Number of
Shares
|
Issue
Date
|
That Can
Be Earned
|
|||||||||||||
Mr. Bolton
|
||||||||||||||||
Time vested shares (1)
|
6,505
|
6,505
|
1/9/2017
|
0
|
||||||||||||
Performance-based shares
|
||||||||||||||||
FFO less MI Expense per Share (2)
|
9,757
|
9,757
|
4/2/2018
|
0
|
||||||||||||
3-Year total shareholder return (3)
|
16,262
|
0
|
N/A
|
16,262
|
||||||||||||
Mr. Campbell
|
||||||||||||||||
Time vested shares (1)
|
3,162
|
3,162
|
1/9/2017
|
0
|
||||||||||||
Performance-based shares
|
||||||||||||||||
FFO less MI Expense per Share (2)
|
4,743
|
4,743
|
4/2/2018
|
0
|
||||||||||||
3-Year total shareholder return (3)
|
7,905
|
0
|
N/A
|
7,905
|
||||||||||||
Mr. DelPriore
|
||||||||||||||||
Time vested shares (1)
|
2,642
|
2,642
|
1/9/2017
|
0
|
||||||||||||
Performance-based shares
|
||||||||||||||||
FFO less MI Expense per Share (2)
|
3,964
|
3,964
|
4/2/2018
|
0
|
||||||||||||
3-Year total shareholder return (3)
|
6,606
|
0
|
N/A
|
6,606
|
||||||||||||
Mr. Grimes
|
||||||||||||||||
Time vested shares (1)
|
3,241
|
3,241
|
1/9/2017
|
0
|
||||||||||||
Performance-based shares
|
||||||||||||||||
FFO less MI Expense per Share (2)
|
4,861
|
4,861
|
4/2/2018
|
0
|
||||||||||||
3-Year total shareholder return (3)
|
8,103
|
0
|
N/A
|
8,103
|
(1) |
The time vested shares represent 20% of the total award opportunity under the 2017 LTIP for named executive officers. The shares vest 20% annually on the first, second, third, fourth and fifth anniversary of the issue date subject to continued employment through each vest date. No additional shares can be issued under this tranche of the 2017 LTIP. See pages 47 through 51 for additional information.
|
(2) |
The “FFO less MI Expense per Share” performance shares represent 30% of the total award opportunity under the 2017 LTIP for named executive officers. The performance period for this tranche was from January 1, 2017 through December 31, 2017. The shares vest 50% annually on the first and second anniversary of the issue date subject to continued employment through each vest date. No additional shares can be earned under this tranche of the 2017 LTIP. See pages 47 through 51 for additional information.
|
(3) |
The “3-year total shareholder return” performance shares represent 50% of the total award opportunity under the 2017 LTIP for named executive officers. The performance period for this tranche is from January 1, 2017 through December 31, 2019. Any shares earned under this tranche will be issued on April 1, 2020 and will immediately vest at that time subject to continued employment through the issue date. See pages 47 through 51 for additional information.
|
Maximum
|
Earned to Date
|
Additional
Shares
|
||||||||||||||
Potential
Shares
|
Number of
Shares
|
Issue
Date
|
That Can
Be Earned
|
|||||||||||||
Mr. Bolton
|
||||||||||||||||
Time vested shares (1)
|
0
|
0
|
N/A
|
0
|
||||||||||||
Performance-based shares
|
||||||||||||||||
Overhead expense synergy (2)
|
10,297
|
0
|
10,297
|
|||||||||||||
New development (3)
|
2,574
|
0
|
2,574
|
|||||||||||||
Incremental NOI improvement (4)
|
2,574
|
0
|
2,574
|
|||||||||||||
Redevolpment (5)
|
2,574
|
0
|
2,574
|
|||||||||||||
Cost of capital improvement (6)
|
2,574
|
0
|
2,574
|
|||||||||||||
Mr. Campbell
|
||||||||||||||||
Time vested shares (1)
|
0
|
0
|
N/A
|
0
|
||||||||||||
Performance-based shares
|
||||||||||||||||
Overhead expense synergy (2)
|
4,290
|
0
|
4,290
|
|||||||||||||
New development (3)
|
1,072
|
0
|
1,072
|
|||||||||||||
Incremental NOI improvement (4)
|
1,072
|
0
|
1,072
|
|||||||||||||
Redevolpment (5)
|
1,072
|
0
|
1,072
|
|||||||||||||
Cost of capital improvement (6)
|
1,072
|
0
|
1,072
|
|||||||||||||
Mr. DelPriore
|
||||||||||||||||
Time vested shares (1)
|
0
|
0
|
N/A
|
0
|
||||||||||||
Performance-based shares
|
||||||||||||||||
Overhead expense synergy (2)
|
4,183
|
0
|
4,183
|
|||||||||||||
New development (3)
|
1,045
|
0
|
1,045
|
|||||||||||||
Incremental NOI improvement (4)
|
1,045
|
0
|
1,045
|
|||||||||||||
Redevolpment (5)
|
1,045
|
0
|
1,045
|
|||||||||||||
Cost of capital improvement (6)
|
1,045
|
0
|
1,045
|
|||||||||||||
Mr. Grimes
|
||||||||||||||||
Time vested shares (1)
|
0
|
0
|
N/A
|
0
|
||||||||||||
Performance-based shares
|
||||||||||||||||
Overhead expense synergy (2)
|
3,298
|
0
|
3,298
|
|||||||||||||
New development (3)
|
824
|
0
|
824
|
|||||||||||||
Incremental NOI improvement (4)
|
824
|
0
|
824
|
|||||||||||||
Redevolpment (5)
|
824
|
0
|
824
|
|||||||||||||
Cost of capital improvement (6)
|
824
|
0
|
824
|
(1) |
The Merger Plan does not allow for the issuance of any time vested shares.
|
(2) |
The “Overhead Expense Synergy” performance shares represent 50% of the total award opportunity under the Merger Plan. Any shares earned under this tranche will be issued on April 1, 2019 and will vest 50% annually on the first and second anniversary of the issue date subject to continued employment through each vest date. See page 51 for additional information.
|
(3) |
The “New Development” performance shares represent 12.5% of the total award opportunity under the Merger Plan. Any shares earned under this tranche will be issued on April 1, 2019 and will vest 50% annually on the first and second anniversary of the issue date subject to continued employment through each vest date. See page 51 for additional information.
|
(4) |
The “Incremental NOI Improvement” performance shares represent 12.5% of the total award opportunity under the Merger Plan. Any shares earned under this tranche will be issued on April 1, 2019 and will vest 50% annually on the first and second anniversary of the issue date subject to continued employment through each vest date. See page 51 for additional information.
|
(5) |
The “Redevelopment” performance shares represent 12.5% of the total award opportunity under the Merger Plan. Any shares earned under this tranche will be issued on April 1, 2019 and will vest 50% annually on the first and second anniversary of the issue date subject to continued employment through each vest date. See page 51 for additional information.
|
(6) |
The “Cost of Capital Improvement” performance shares represent 12.5% of the total award opportunity under the Merger Plan. Any shares earned under this tranche will be issued on April 1, 2019 and will vest 50% annually on the first and second anniversary of the issue date subject to continued employment through each vest date. See page 51 for additional information.
|
· |
our operating performance; and
|
· |
return to shareholders over time relative to other multifamily REITs and other peer companies.
|
· |
Net Income Available for MAA Common Shareholders for 2017 was $2.86 per diluted common share, which was a 6.3% increase from $2.69 per diluted common share for 2016. Results for 2017 included $1.12 per diluted common share of gains related to the sale of real estate assets; $0.18 per diluted common share of merger and integration costs related to the merger with Post; and $0.08 per diluted common share of non-cash income related to an embedded derivative in the preferred shares issued in the merger with Post. Results for 2016 included $1.05 per diluted common share of gains related to the sale of real estate assets and $0.52 per diluted common share of merger and integration costs related to the merger with Post;
|
· |
FFO for 2017 was $5.94 per Share, which represented a 6.3% growth over $5.59 per diluted Share for 2016. Results for 2017 included $0.07 per Share of non-cash income related to an embedded derivative in the preferred shares issued in the merger with Post, and $0.17 per Share of merger and integration costs related to the merger with Post. Results for 2016 included $0.49 per share of merger and integration costs related to the merger with Post;
|
· |
Made significant progress in merging the platforms of MAA and Post following the completion of the merger on December 1, 2016;
|
· |
Acquired two multifamily apartment communities for a total combined capital investment of $134 million;
|
· |
Sold five multifamily apartment communities for total combined gross proceeds of $186 million and a combined total gain on sale of approximately $127 million, achieving a combined leveraged IRR of 14.5%;
|
· |
Invested approximately $173 million in new development during 2017 and had three development projects underway containing 937 units, with a total projected cost of approximately $214 million, of which, approximately $46 million remained to be spent, as of December 31, 2017;
|
· |
As of December 31, 2017, MAA had five apartment communities, consisting of a total of 1,538 units, in various stages of lease-up with an overall average physical occupancy of 62.5%;
|
· |
Completed the redevelopment of 8,375 apartment units for a total investment of approximately $46 million, achieving average rental rate increases of 8.8% above non-renovated units;
|
· |
Ended the year with total debt to total assets (as defined in the covenants for the bonds issued by MAA’s primary operating partnership, Mid-America Apartments, L.P.) of 33.2%, compared to 33.9% as of December 31, 2016;
|
· |
As of December 31, 2017, total debt outstanding was $4.5 billion at an average effective interest rate of 3.6%, and 83% was fixed or hedged against rising interest rates for an average of 4.7 years.
|
Quarterly Dividend Rate per Common Share
|
Annualized Total Shareholder Return
|
Total Return Performance
|
2017 |
Achieved FFO of $699.6 million, or $5.94 per Share, a 6.3% increase over the prior year
|
2016 |
Consummated the merger with Post moving MAA to total market capitalization of approximately $15 billion as of December 1, 2016, the closing date of the merger
|
2015 |
Acquired multifamily properties and development land totaling approximately $321 million and invested an additional $56 million in development, completing two multifamily projects
|
BASE SALARY
Base salary for 2017 was increased from $640,000 to $704,000.
|
The Compensation Committee engaged Semler Brossy to provide compensation benchmarking data relative to our revised peer group and other market sources following our merger with Post to assist in evaluating our executive compensation. Based on their analysis, Semler Brossy reported that Mr. Bolton’s base salary was significantly below median for both the revised peer group following the merger with Post and other survey data reviewed. Considering the increased complexity and size of MAA following the merger with Post, and taking into account the results of the benchmarking analysis performed by Semler Brossy, the Compensation Committee recommended, and the Board approved, a 10% increase in Mr. Bolton’s base salary for 2017. While the increased base salary is still well below the median salaries of the peer group and other survey data reviewed, the Compensation Committee felt it was a balanced and measured first step in adjusting Mr. Bolton’s compensation.
|
ANNUAL INCENTIVE
The percent of salary opportunity available as an annual incentive for 2017 was held consistent with the prior year at 250%.
|
The comparison provided by Semler Brossy indicated the annual cash opportunity for Mr. Bolton was significantly below the median of the revised peer group and other survey data reviewed. However, taking into account the impact of the increase in base salary, which only partially bridges the gap between Mr. Bolton’s opportunity and that of the revised peer median, and Mr. Bolton’s compensation package as a whole, the Compensation Committee determined not to increase Mr. Bolton’s annual incentive opportunity for 2017.
|
LONG-TERM EQUITY COMPENSATION
The total percent of salary opportunity available for 2017 in the form of restricted stock awards through our long-term incentive program was increased from 400% to 450%.
|
The Compensation Committee believes that compensation derived from equity awards directly aligns management with the interests of our shareholders and is most closely linked to accomplishing our strategic vision to provide a stable and growing dividend to shareholders over the long term. The comparison provided by Semler Brossy of Mr. Bolton’s compensation as compared to the revised peer group and other survey data indicated the lion’s share of shortfalls to median compensation fell in the equity component. The amount of opportunity awarded reflects the Compensation Committee’s continued confidence in Mr. Bolton’s strategic vision and leadership, and the increased complexity and size of MAA following the merger with Post.
The total amount of the opportunity in the long-term incentive program linked to performance-based metrics remained flat at 80%, with 50% of the overall opportunity remaining linked to the performance-based metric of 3-year total shareholder return performance. Performance-based long-term incentive compensation represents a significant component of Mr. Bolton’s pay.
|
· |
to align the financial interests of the executive officers with those of our shareholders, both in the short and long term;
|
· |
to provide incentives for achieving and exceeding annual and long-term performance goals;
|
· |
to attract, retain and motivate highly competent executives by providing total compensation that is competitive with compensation at other well-managed REITs and real estate companies;
|
· |
to reward superior corporate and individual performance achieved through ethical leadership; and
|
· |
to appropriately reward executive officers for creating long-term shareholder value and returns.
|
· |
Pay for performance (see pages 35 through 39)
|
· |
Mitigate undue risk in compensation programs (see pages 53 through 54)
|
· |
Include vesting periods on performance share awards (see pages 48 through 49)
|
· |
Adopted share ownership guidelines (see page 57)
|
· |
Adopted holding period requirements for equity compensation (see page 58)
|
· |
Prohibit hedging transactions, pledging and short sales by executive officers or directors (see page 58)
|
· |
Utilize an independent compensation consulting firm which provides no other services for us (see pages 56 through 57)
|
· |
Provide reasonable post-employment/change in control provisions (see pages 79 through 81)
|
· |
Adopted a clawback policy (see page 58)
|
· |
No dividends or dividend equivalents on unearned performance shares
|
· |
No repricing underwater stock options
|
· |
No exchanges of underwater stock options for cash
|
· |
No multi-year guaranteed bonuses
|
· |
No inclusion of the value of equity awards in severance calculations
|
· |
No evergreen provisions in equity plans
|
· |
No tax “gross ups” for excess parachute payments
|
· |
No “single trigger” employment or change in control agreements
|
2017 Total Compensation Opportunity
|
Mr. Bolton
|
Mr. Campbell
|
Mr. DelPriore
|
Mr. Grimes
|
|||||||||||||
Base Salary (1)
|
$
|
704,000
|
$
|
440,000
|
$
|
429,000
|
$
|
451,000
|
||||||||
Annual Incentive Program (2)
|
||||||||||||||||
Potential Percent of Base Salary
|
0% - 250
|
%
|
0% - 150
|
%
|
0% - 150
|
%
|
0% - 200
|
%
|
||||||||
Target Percent of Base Salary
|
167.500
|
%
|
112.875
|
%
|
112.875
|
%
|
178.220
|
%
|
||||||||
Dollar Target (3)
|
$
|
1,179,200
|
$
|
496,650
|
$
|
484,234
|
$
|
803,772
|
||||||||
2017 LTIP
|
||||||||||||||||
Potential Percent of Base Salary
|
0% - 450
|
%
|
0% - 350
|
%
|
0% - 300
|
%
|
0% - 350
|
%
|
||||||||
Target Percent of Base Salary
|
324
|
%
|
252
|
%
|
216
|
%
|
252
|
%
|
||||||||
Dollar Target (4)
|
$
|
2,280,960
|
$
|
1,108,800
|
$
|
926,640
|
$
|
1,136,520
|
||||||||
Total Target Compensation
|
$
|
4,164,160
|
$
|
2,045,450
|
$
|
1,839,874
|
$
|
2,391,292
|
(1) |
Values reflect the base salaries awarded by the Compensation Committee for 2017.
|
(2) |
Does not reflect the 25% increase of award if participant elects to receive the award as shares of restricted stock.
|
(3) |
Represents the target potential bonus payment under the Annual Incentive Program. More information on the Annual Incentive Program can be found in the narrative that follows.
|
(4) |
Represents the target award under the 2017 LTIP. More information on the 2017 LTIP can be found in the narrative that follows.
|
· |
breadth, scope and complexity of the role;
|
· |
fairness (employees with similar responsibilities, experience and historical performance are rewarded comparably) and affordability;
|
· |
current compensation; and
|
· |
individual and corporate performance.
|
ANNUAL MERIT INCREASES
|
All employees’ base salaries are reviewed annually for possible merit increases, but merit increases are not automatic nor guaranteed. Any adjustments take into account the individual’s performance, responsibilities and experience, as well as fairness and external market practices.
|
PROMOTIONS OR CHANGES IN ROLE
|
Base salary may be increased to recognize additional responsibilities resulting from a change in an employee’s role or a promotion to a new position. Increases are not guaranteed for a promotion nor change in role.
|
Base Salary
|
Percent
|
|||||||||||
2017
|
2016
|
Increase
|
||||||||||
Mr. Bolton
|
$
|
704,000
|
$
|
640,000
|
10.0
|
%
|
||||||
Mr. Campbell
|
$
|
440,000
|
$
|
400,000
|
10.0
|
%
|
||||||
Mr. DelPriore
|
$
|
429,000
|
$
|
390,000
|
10.0
|
%
|
||||||
Mr. Grimes
|
$
|
451,000
|
$
|
410,000
|
10.0
|
%
|
Base Salary
|
Percentage
of 2017
Base Salary (1)
|
Maximum Payment
Based on 2017
Performance (1)
|
||||||||||
Mr. Bolton
|
$
|
704,000
|
250
|
%
|
$
|
1,760,000
|
||||||
Mr. Campbell
|
$
|
440,000
|
150
|
%
|
$
|
660,000
|
||||||
Mr. DelPriore
|
$
|
429,000
|
150
|
%
|
$
|
643,500
|
||||||
Mr. Grimes
|
$
|
451,000
|
200
|
%
|
$
|
902,000
|
(1) |
Does not include the impact of the option for participants to elect to have all or a part of their award issued as shares of restricted stock. Any portion elected to be issued as shares of restricted stock would be awarded at 125% of the award earned.
|
Percent of Award
|
||||||||||||
FFO less MI
per Share
|
Individual
Goals
|
Total
|
||||||||||
Mr. Bolton
|
100
|
%
|
N/A
|
100
|
%
|
|||||||
Mr. Campbell
|
75
|
%
|
25
|
%
|
100
|
%
|
||||||
Mr. DelPriore
|
75
|
%
|
25
|
%
|
100
|
%
|
||||||
Mr. Grimes
|
33
|
%
|
67
|
%
|
100
|
%
|
Performance
|
FFO less MI
per Share
|
Percent of
Bonus Opportunity
|
||||||
High
|
$
|
6.07
|
100
|
%
|
||||
Target
|
$
|
5.97
|
67
|
%
|
||||
Threshold
|
$
|
5.87
|
25
|
%
|
Base Salary
|
Maximum
Percentage
of Base Salary
|
Percent of
Maximum Bonus
Opportunity Earned
|
Annual
Incentive
Payment
|
|||||||||||||
Mr. Bolton
|
$
|
704,000
|
250
|
%
|
87
|
%
|
$
|
1,536,480
|
||||||||
Mr. Campbell
|
$
|
440,000
|
150
|
%
|
88
|
%
|
$
|
580,635
|
||||||||
Mr. DelPriore
|
$
|
429,000
|
150
|
%
|
89
|
%
|
$
|
574,163
|
||||||||
Mr. Grimes
|
$
|
451,000
|
200
|
%
|
71
|
%
|
$
|
640,591
|
Relative TSR
(50% of
opportunity)
|
FFO less MI
per Share
(30% of
opportunity)
|
Time
Vested
(20% of
opportunity)
|
Total
Potential
Percent
of Salary
|
|||||||||||||
Mr. Bolton
|
225%
|
|
135%
|
|
90%
|
|
450%
|
|
||||||||
Mr. Campbell
|
175%
|
|
105%
|
|
70%
|
|
350%
|
|
||||||||
Mr. DelPriore
|
150%
|
|
90%
|
|
60%
|
|
300%
|
|
||||||||
Mr. Grimes
|
175%
|
|
105%
|
|
70%
|
|
350%
|
|
· |
skills, experience and time in role;
|
· |
individual performance and potential; and
|
· |
company performance in the prior year.
|
Time Vested Restricted Stock
|
Performance Shares |
|
Performance
Level
|
MAA TSR in excess of
SNL US REIT Multifamily Index
|
Percent of
Relative TSR
Opportunity Earned
|
||||
High
|
≥ 400 basis points
|
100%
|
||||
Target
|
0 basis points
|
65%
|
|
|||
Threshold
|
-300 basis points
|
25%
|
|
|||
< -300 basis points
|
0%
|
Performance
Level
|
FFO less MI
per Share
|
Percent of FFO
less MI per Share
Opportunity Earned
|
||||||
High
|
$
|
6.07
|
100%
|
|||||
Target
|
$
|
5.97
|
65%
|
|
||||
Threshold
|
$
|
5.87
|
25%
|
|
||||
|
< $5.87
|
0%
|
|
Shares of
Restricted
Stock
|
||||
Mr. Bolton
|
9,757
|
|||
Mr. Campbell
|
4,743
|
|||
Mr. DelPriore
|
3,964
|
|||
Mr. Grimes
|
4,861
|
· |
restricted shares that vest over time encourage named executive officers to focus on the long term when making decisions to enhance shareholder value;
|
· |
declines in stock price following the grant of time vested restricted stock have a negative impact on named executive officer pay; and
|
· |
feedback from named executive officers has indicated that time vested restricted stock is highly valued and is an important retention tool.
|
Shares of
Restricted
Stock
|
||||
Mr. Bolton
|
6,505
|
|||
Mr. Campbell
|
3,162
|
|||
Mr. DelPriore
|
2,642
|
|||
Mr. Grimes
|
3,241
|
Overhead
Spend
Synergy
(50% of
opportunity)
|
New
Development
Pipeline
(12.5% of
opportunity)
|
Incremental
Same Store NOI
Improvement
(12.5% of
opportunity)
|
Incremental
Redevelopment
NOI
(12.5% of
opportunity)
|
Lowered
Cost
of Capital
(12.5% of
opportunity)
|
Total
Potential
Percent
of Salary
|
|||||||||||||||||||
Mr. Bolton
|
150
|
%
|
37.50
|
%
|
37.50
|
%
|
37.50
|
%
|
37.50
|
%
|
300
|
%
|
||||||||||||
Mr. Campbell
|
100
|
%
|
25.00
|
%
|
25.00
|
%
|
25.00
|
%
|
25.00
|
%
|
200
|
%
|
||||||||||||
Mr. DelPriore
|
100
|
%
|
25.00
|
%
|
25.00
|
%
|
25.00
|
%
|
25.00
|
%
|
200
|
%
|
||||||||||||
Mr. Grimes
|
75
|
%
|
18.75
|
%
|
18.75
|
%
|
18.75
|
%
|
18.75
|
%
|
150
|
%
|
· |
Base salary does not encourage risk-taking as it is a fixed amount and but one component of a balanced, multi-component approach to compensation and rewards.
|
· |
The annual incentive program for executive officers is designed to reward achievement of short-term performance metrics. Through a combination of plan design and management procedures, undue risk-taking is mitigated. Specifically, the plan has a cap on the award for any individual and constitutes only a portion of the total direct compensation for our executive officers. The plan is also structured to be self-funding in that portions of the incentive that are based on performance measurements must be obtained after the expense of the incentive is considered.
|
· |
Annual and quarterly incentive plans for employees other than executive officers are also designed to reward achievement of short-term performance metrics. Through a combination of plan design and management procedures, undue risk-taking is mitigated. Specifically, the plans are capped on the award for any individual and constitute only a portion of the total direct compensation for our employees.
|
· |
Our long-term incentive plans are materially based on total shareholder return and certain other performance metrics. The plans have caps on the award for any individual and constitute only a portion of the total direct compensation for our executive officers and the other participants.
|
· |
our analyses of competitive compensation practices;
|
· |
the Compensation Committee’s evaluation of the executive officers;
|
· |
individual performance and contributions to performance goals, which could include, but are not limited to FFO per Share, and total shareholder return;
|
· |
company performance, including comparisons to market and peer benchmarks;
|
· |
operational management, such as project milestones and process improvements;
|
· |
internal working and reporting relationships and our desire to encourage collaboration and teamwork among our executive officers;
|
· |
individual expertise, skills and knowledge;
|
· |
leadership, including developing and motivating employees, collaborating within the company, attracting and retaining employees and personal development;
|
· |
labor market conditions, the need to retain and motivate, the potential to assume increased responsibilities and the perceived long-term value to the company; and
|
· |
information and advice from an independent, third-party compensation consultant engaged by the Compensation Committee.
|
· |
as an input in developing base salary ranges, annual incentive targets and long-term incentive award ranges;
|
· |
to benchmark the mix of cash and equity awarded to named executive officers;
|
· |
to assess the competitiveness of total direct compensation awarded to senior executives;
|
· |
to validate whether executive compensation programs are aligned with our performance and total shareholder return; and
|
· |
as an input in designing compensation plans, benefits and perquisite programs.
|
Apartment investment & Management Co.
|
Essex Property Trust, Inc.
|
AvalonBay Communities, Inc.
|
Extra Space Storage, Inc.
|
Boston Properties, Inc.
|
Federal Realty Investment Trust
|
Brixmor Property Group, Inc.
|
Host Hotels & Resorts, Inc.
|
Camden Property Trust
|
Kimco Realty Corp.
|
DDR Corp.
|
Macerich Co.
|
Duke Realty Corp.
|
Taubman Centers, Inc.
|
Equity Residential
|
UDR, Inc.
|
· |
the policies and procedures the consultant has in place to prevent conflicts of interest;
|
· |
any business or personal relationships between the consultant and the members of the Compensation Committee;
|
· |
any ownership of our common stock by the individuals at Semler Brossy performing consulting services for the Compensation Committee; and
|
· |
any business or personal relationship of Semler Brossy with any of our executive officers.
|
COMPENSATION COMMITTEE:
|
|
Philip W. Norwood (Chair)
|
|
Toni Jennings
|
|
James K. Lowder
|
|
Monica McGurk
|
|
Claude B. Nielsen
|
MATTER TO BE VOTED
To approve the Second Amended and Restated Mid-America Apartment Communities, Inc.
2013 Stock Incentive Plan.
|
Shareholders are being asked to approve the Second Amended and Restated Mid-America Apartment Communities, Inc. 2013 Stock Incentive Plan to, among other things, increase the number of shares available for issuance under the plan to 2,000,000.
Absent an increase in the number of authorized shares under the plan, we do not expect to have sufficient shares to meet our anticipated equity compensation needs beyond 2018. We believe increasing the number of shares issuable under the plan is necessary in order to allow MAA to continue to utilize equity awards to attract and retain key individuals essential to our long-term growth and financial success and to further align management interests with those of our shareholders.
|
|
VOTE REQUIRED
|
For the proposal to be approved, the votes cast “For” the proposal must exceed the votes cast “Against” the proposal.
|
|
Impact of
Abstentions and
Broker Non-Votes
|
Abstentions will have the legal effect of votes against the proposal. Broker non-votes will not have any legal effect on whether this proposal is approved.
|
|
BOARD
RECOMMENDATION
|
FOR
|
Our Board recommends a vote “FOR” approval of the Second Amended and Restated Mid-America Apartment Communities, Inc. 2013 Stock Incentive Plan.
|
1. |
Increase the number of shares available for issuance to 2,000,000;
|
2. |
Prohibit certain share recycling practices (the Amended Plan does not allow any shares which are tendered or held back upon exercise of a stock option or settlement of an award to cover the exercise price or tax withholding, or repurchased by us on the open market, to be added back to the shares of stock available to be issued);
|
3. |
Amend the annual limit on independent director compensation such that (i) the aggregate grant date fair value of all equity awards granted to an independent director during any single calendar year may not exceed $400,000 and (ii) the aggregate cash compensation paid to an independent director may not exceed $250,000; and
|
4. |
Amend the maximum performance-based award payable to any one Covered Employee for a Performance Cycle commencing after the effective date of the Amended Plan to 150,000 shares, or $5,000,000 in the case of a performance-based award that is a cash-based award.
|
· |
MAA’s historical burn rate;
|
· |
the number of shares remaining available under the Current Plan for future awards (194,916 or 0.17% of outstanding shares of common stock as of December 31, 2017);
|
· |
the number of shares issuable upon the exercise of outstanding stock options (108,438 or 0.10% of outstanding shares of common stock as of December 31, 2017);
|
· |
the number of outstanding unvested restricted shares (180,692 or 0.16% of outstanding shares of common stock as of December 31, 2017);
|
· |
dilution resulting from the proposed increase in authorized shares;
|
· |
the shareholder value transfer resulting from the proposed increase; and
|
· |
the conformance of the Amended Plan to good governance practices:
|
o |
fixed term of 10 years from the date of shareholder approval;
|
o |
no annual “evergreen” provision (the Amended Plan limits the number of shares to 2,000,000 and does not provide annual or automatic increases to the number of shares authorized to be issued);
|
o |
prohibits the ability to pay dividends or dividend equivalents on performance-based awards until the performance-based conditions have been met;
|
o |
prohibits dividends or dividend equivalents on stock options and stock appreciation rights;
|
o |
prohibits repricing of awards without shareholder approval;
|
o |
restricts transfers of restricted stock awards, restricted stock units, unrestricted stock awards; and performance share awards during a participant’s lifetime;
|
o |
prohibits liberal recycling of shares;
|
o |
is administered by our Compensation Committee, which is solely comprised of independent, non-employee directors; and
|
o |
requires shareholder approval for any material amendment (other than an amendment that curtails the scope of the plan).
|
(a)
|
(b)
|
(c)
|
||||||||||
Number of Securities
to be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights
|
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
|
Number of Securities
Remaining Available
for Future Issuance
Under Equity
Compensation Plans
(Excluding Securities
Reflected in Column
(a))
|
||||||||||
Equity compensation plans approved by security holders (1)
|
108,438
|
$
|
72.93
|
194,916
|
||||||||
Equity compensation plans not approved by security holders
|
0
|