8-KLeadership ChangesRegulation FDOther Events+1

WELLTOWER INC. 8-K Report, Executive Changes (Apr 14, 2014)

Filed April 14, 2014For Securities:WELL

Summary

This 8-K filing from Health Care REIT, Inc. (now Welltower Inc.) on April 14, 2014, announces significant leadership changes. George L. Chapman, the long-standing Chairman, CEO, and President, has retired effective immediately, citing personal health and other commitments. He will remain with the company in a consulting capacity for up to three years with a tiered monthly fee and continued benefits, including accelerated vesting of certain equity awards and post-retirement insurance premium reimbursement. Thomas J. DeRosa has been appointed as the new Chief Executive Officer, effective immediately. Mr. DeRosa brings extensive real estate and investment banking experience, having previously served on the company's Board. Jeffrey H. Donahue, previously the independent Lead Director, has been appointed as the non-executive Chairman of the Board. The filing also details Mr. DeRosa's employment agreement, including his base salary, bonus potential, long-term stock awards, and severance provisions, as well as a change to the Board's size.

Key Highlights

  • 1George L. Chapman retires as Chairman, CEO, and President, effective immediately.
  • 2Thomas J. DeRosa appointed as the new Chief Executive Officer.
  • 3Jeffrey H. Donahue appointed as non-executive Chairman of the Board.
  • 4Mr. Chapman will provide consulting services for up to three years with specified fees and benefits.
  • 5Mr. DeRosa's employment agreement includes a base salary of $825,000 and significant bonus and long-term incentive compensation potential.
  • 6The Board's size has been reduced to nine directors.
  • 7The company has separated the roles of Chairman and CEO, with a non-executive Chairman now in place.

Frequently Asked Questions

George L. Chapman retired due to his desire to focus on his health, along with other personal and civic commitments. The filing explicitly states this was not due to any disagreement with the company regarding its operations, policies, or practices.

Mr. Chapman will provide consulting and advisory services for up to three years, starting July 1, 2014. He will be paid $104,167 per month in the first year, $62,500 in the second, and $41,667 in the third. He will also receive pro-rata bonus for 2014, full vesting of certain stock awards, and potential reimbursement for insurance premiums up to $400,000 if he consults through June 30, 2015.

Thomas J. DeRosa will receive an annual base salary of $825,000. His target bonus opportunity is 150% of base salary (max 300%). He will also receive annual long-term stock awards intended to have a value of $3,300,000 at target and a one-time restricted stock unit award valued at $1,000,000, subject to vesting and performance goals.

If Mr. DeRosa's employment is terminated by the company without good cause or he resigns for good reason, he is entitled to two times his then current annual base salary and target annual cash bonus opportunity over two years. In the event of a change in control of the company, followed by termination without good cause or resignation for good reason within 24 months, he will receive three times his then current annual base salary and target annual cash bonus opportunity.