8-KOther EventsExhibits & Filings

WELLTOWER INC. 8-K Report, Corporate Update (Apr 30, 2024)

Filed April 30, 2024For Securities:WELL

Summary

Welltower Inc. (WELL) announced on April 30, 2024, the execution of a new Equity Distribution Agreement, which allows for the potential offering and sale of up to $3.5 billion of its common stock. This agreement replaces a prior one from February 15, 2024. The new arrangement includes provisions for sales through various agents and also enables the company to enter into forward sale agreements with forward purchasers. The forward sale agreements introduce a mechanism where forward purchasers may borrow and sell shares of WELL's common stock, with Welltower expecting to physically settle these agreements at a later date by delivering shares or receiving cash. This structure provides flexibility in how the company manages its equity offerings, potentially allowing for immediate liquidity generation for the forward purchasers while Welltower retains the obligation to deliver shares or cash at settlement. Investors should note that the company may not receive proceeds if the forward sale agreements are cash or net share settled.

Key Highlights

  • 1Entered into a new Equity Distribution Agreement with a syndicate of sales agents, effective April 30, 2024.
  • 2The new agreement allows for the potential sale of up to $3.5 billion of common stock (ATM Shares).
  • 3This supersedes the previous equity distribution agreement dated February 15, 2024.
  • 4The agreement includes provisions for forward sale agreements with forward purchasers, allowing for immediate borrowing and sale of shares by forward purchasers.
  • 5Welltower expects to physically settle forward sale agreements at a future date, receiving cash proceeds or delivering shares.
  • 6The company may opt for cash or net share settlement, which could result in no proceeds or an obligation to pay cash/deliver shares.
  • 7The offering is registered under an automatic shelf registration statement on Form S-3.

Frequently Asked Questions

The new Equity Distribution Agreement allows Welltower Inc. to offer and sell shares of its common stock from time to time, up to a maximum aggregate sales price of $3.5 billion. This provides the company with flexibility to raise capital or manage its equity through various sales channels, including forward sale agreements.

Under forward sale agreements, a forward purchaser (or its affiliate) may borrow and sell Welltower's common stock in the market. Welltower then expects to settle these agreements at a future date by delivering shares or receiving cash. This mechanism can provide immediate liquidity for the forward purchaser while Welltower fulfills its obligation later.

Not necessarily. While Welltower expects to receive cash proceeds if it physically settles the forward sale agreements, it may also elect to cash settle or net share settle. In a cash settlement, Welltower may owe cash, and in a net share settlement, it will not receive any proceeds and may owe shares. The company will not receive proceeds from the initial sale of borrowed shares by a forward seller.

The agreement covers the issuance and sale of the Company's common stock. The forward sale agreements involve forward purchasers borrowing and selling shares in the market, with Welltower intending to settle these later. The ultimate impact on outstanding shares and proceeds depends on the settlement method chosen by Welltower.