Form 4: Tyler Technologies Executive VP Brian K. Miller Reports Stock Transactions

Executive VP and CFO of Tyler Technologies, Brian K. Miller, reports the vesting and settling of performance-based restricted stock units and restricted stock units, along with the acquisition and disposal of common stock.

Summary

• On March 1, 2024, Brian K. Miller, Executive VP and CFO of Tyler Technologies, reported transactions involving common stock and derivative securities.
• These transactions include the vesting and settling of performance-based restricted stock units (PRSUs) and restricted stock units (RSUs) into common stock.
• Specifically, 4,999 PRSUs vested based on cumulative recurring revenue growth, and 1,215 PRSUs vested based on non-GAAP earnings per share, both tied to performance periods ending December 31, 2023.
• Additionally, 463 RSUs vested from a grant made on March 1, 2023.
• The reporting person also acquired and disposed of shares to cover tax obligations related to the vesting of these units.
• Following these transactions, Miller directly owns 18,659.5582 shares of common stock and indirectly owns 26,781 shares through family trusts.
• Miller was also granted 3,402 performance-based restricted stock units based upon cumulative non-GAAP adjusted recurring revenue growth over the three-year performance period ending December 31, 2026.
• Miller was also granted 3,402 performance-based restricted stock units based upon non-GAAP net operating margin for the year ending December 31, 2026.
• Miller was also granted 963 performance-based restricted stock units based upon non-GAAP earnings per share for the one-year performance period ending December 31, 2024.
• Miller was also granted 1,134 restricted stock units that vest in equal installments on each of the first, second, and third anniversaries of the date of grant.

Sentiment

Score: 7

Explanation: The sentiment is neutral to slightly positive. The vesting of performance-based awards suggests that the company is meeting its performance targets. However, the disposal of shares to cover tax obligations is a neutral event.

Positives

• The vesting of performance-based restricted stock units indicates that the company has met certain performance targets related to revenue growth and earnings per share.
• The continued granting of performance-based restricted stock units incentivizes the executive to continue driving company performance.
• The executive's continued employment through the vesting dates demonstrates commitment to the company.

Negatives

• The disposal of shares to cover tax obligations reduces the executive's direct ownership stake in the company.

Risks

• Future vesting of performance-based restricted stock units is contingent upon the company achieving specific performance goals, which may not be met.
• The value of the shares received upon vesting is subject to market fluctuations, which could impact the executive's compensation.

Future Outlook

Future vesting of performance-based restricted stock units is contingent upon the company achieving specific performance goals related to revenue growth, earnings per share, and net operating margin over various performance periods.

Industry Context

Stock transactions by company executives are a common occurrence and are closely monitored by investors for insights into management's confidence in the company's future prospects. The vesting of performance-based awards suggests that the company is meeting its performance targets, which is a positive signal for investors.

Comparison to Industry Standards

• Comparing Tyler Technologies to similar companies in the software and IT services sector, such as Oracle, SAP, or Accenture, executive compensation packages often include a mix of salary, stock options, and performance-based incentives.
• The specific metrics used for performance-based awards, such as revenue growth and earnings per share, are common industry benchmarks for assessing company performance.
• The vesting schedules and performance targets for these awards are typically aligned with the company's long-term strategic goals.

Stakeholder Impact

• Shareholders: The vesting of performance-based awards can be viewed positively as it aligns executive compensation with company performance.
• Employees: The company's performance and the executive's actions can impact employee morale and motivation.
• Customers: The company's financial performance and strategic direction can impact the quality of products and services offered to customers.

Next Steps

• Monitor future Form 4 filings to track changes in the executive's beneficial ownership of company stock.
• Assess the company's performance against the targets set for future vesting of performance-based awards.
• Evaluate the impact of executive stock transactions on investor sentiment and stock price.

Key Dates