8-KOther EventsExhibits & Filings

WELLTOWER INC. 8-K Report, Corporate Update (Jul 30, 2021)

Filed July 30, 2021For Securities:WELL

Summary

Welltower Inc. (WELL) has entered into an amended and restated equity distribution agreement, significantly increasing its potential to raise capital through the sale of its common stock. The total amount of shares that can be offered and sold under this agreement has been raised from $2 billion to $2.5 billion. This amendment also expands the pool of sales agents and forward sellers, providing more avenues for the company to execute its equity offerings. This move allows Welltower to leverage its common stock to access additional funding, which can be used for various corporate purposes, including strategic investments, debt repayment, or general working capital. The agreement includes provisions for both direct sales of stock and forward sale agreements, offering flexibility in how capital is raised and settled. Investors should note that while the company aims to receive cash proceeds through physical settlement of forward agreements, alternative settlement methods could result in no new proceeds or even an obligation to deliver shares or cash.

Key Highlights

  • 1Welltower Inc. amended and restated its equity distribution agreement, increasing the total potential offering size from $2.0 billion to $2.5 billion.
  • 2The agreement allows for the issuance and sale of shares of the Company's common stock through a network of sales agents and forward sellers.
  • 3Five new sales agents have been added, expanding the distribution network, while two were removed.
  • 4The company has already sold approximately $1.48 billion worth of shares under the prior agreement, with 18,531,255 shares issued.
  • 5The agreement includes mechanisms for both direct equity sales and forward sale agreements, providing flexibility in capital raising.
  • 6Forward sale agreements involve borrowing and selling shares, with potential physical or cash/net share settlement, impacting future cash proceeds or obligations.
  • 7The offering is registered under an automatic shelf registration statement on Form S-3, filed with the SEC.

Frequently Asked Questions

The primary purpose is to increase the maximum aggregate sales price of the Company's common stock that can be offered and sold through the designated sales agents and forward sellers from $2.0 billion to $2.5 billion. This provides Welltower with greater flexibility and capacity to raise capital through equity offerings.

Welltower can raise capital through direct sales of its common stock via the sales agents. Additionally, it can enter into forward sale agreements. Under these agreements, forward purchasers may borrow and sell shares, and Welltower expects to physically settle these agreements at a future date to receive cash proceeds. However, alternative settlement methods like cash or net share settlement are also possible, which could affect whether Welltower receives proceeds.

As of the filing date, Welltower had already sold an aggregate of 18,531,255 shares of its common stock under the prior equity distribution agreement, generating gross proceeds of approximately $1,483,976,017.67.

Yes, while forward sale agreements can provide flexibility, there are risks. The company expects to receive cash proceeds via physical settlement, but if it chooses cash settlement or net share settlement, it may receive no proceeds and could even owe cash or shares to the forward purchaser. The timing and pricing of these settlements are key factors for investors to monitor.