8-KOther EventsExhibits & Filings

WELLTOWER INC. 8-K Report, Corporate Update (Mar 7, 2022)

Filed March 7, 2022For Securities:WELL

Summary

Welltower Inc. (WELL) announced on March 7, 2022, its intention to implement a corporate reorganization, transitioning to an Umbrella Partnership Real Estate Investment Trust (UPREIT) structure. This strategic move involves establishing a new publicly traded parent company, Welltower Inc. (New Welltower), which will replace the current entity (Old Welltower) as the NYSE-listed entity under the "WELL" ticker. The existing common stock will automatically convert into shares of the new parent company without requiring shareholder exchange of certificates. The primary driver for this UPREIT conversion is to enable future flexibility in property contributions. An UPREIT structure allows for the contribution of appreciated real estate to an operating partnership in exchange for partnership units, which can offer tax advantages to property owners. To facilitate this, the current Welltower Inc. (Old Welltower) is slated to convert from a Delaware corporation into a Delaware limited liability company. However, this conversion requires unanimous shareholder approval due to a "Pass-Through Vote Provision" that will be amended. The company intends to seek shareholder approval to remove this provision at its 2022 annual meeting, allowing the conversion to proceed more efficiently.

Key Highlights

  • 1Welltower Inc. is reorganizing into an UPREIT structure to enhance future transaction flexibility.
  • 2A new Delaware corporation, WELL Merger Holdco Inc. ('New Welltower'), will become the publicly traded parent company.
  • 3The existing common stock of Welltower Inc. ('Old Welltower') will automatically convert into shares of New Welltower.
  • 4The NYSE ticker symbol 'WELL' and CUSIP number will remain the same for the new parent company's common stock.
  • 5The NYSE ticker symbols for two note issuances will change (WELL/28 and WELL/34) but retain their existing CUSIPs.
  • 6The conversion of Old Welltower to a limited liability company (Welltower OP LLC) requires shareholder approval to remove a 'Pass-Through Vote Provision'.

Frequently Asked Questions

The primary goal is to transition Welltower Inc. into an UPREIT structure. This structure provides greater flexibility for future property contributions, potentially offering tax advantages to contributors by allowing them to exchange appreciated properties for operating partnership units.

Your existing shares of Welltower Inc. common stock will automatically convert into shares of the new publicly traded parent company, also named Welltower Inc. The ticker symbol 'WELL' and the CUSIP number will remain unchanged, meaning there's no immediate action required from shareholders regarding their stock certificates.

The 'Pass-Through Vote Provision' is a requirement that shareholders of the new parent company must approve certain actions by the operating partnership (Old Welltower) that would have previously required shareholder approval. To convert Old Welltower into a limited liability company (a necessary step for the UPREIT structure), this provision would require unanimous shareholder approval, which is practically difficult to obtain. Welltower plans to ask shareholders to approve its removal at the 2022 annual meeting.

The merger to establish the new parent company is expected to be effective around April 1, 2022. The subsequent conversion of Old Welltower to a limited liability company is anticipated to occur shortly after the 2022 annual shareholders' meeting, contingent upon shareholder approval to remove the Pass-Through Vote Provision.