On October 29, 2024, Welltower Inc. (WELL, Financial), a Delaware corporation, announced the execution of a new equity distribution agreement. This agreement involves Welltower OP LLC and a consortium of financial institutions acting as sales agents and forward sellers. The agreement allows for the issuance, offer, and sale of Welltower's common stock, with a total aggregate sales price of up to $5 billion.
The new agreement replaces a prior equity distribution agreement dated April 30, 2024. Under the terms of the agreement, shares of common stock, referred to as "ATM Shares," may be sold through the sales agents or forward sellers. The company may also enter into forward sale agreements with forward purchasers, allowing for the sale of borrowed shares of common stock.
Welltower Inc. will not receive proceeds from the sale of borrowed shares by a forward seller. However, the company expects to settle each forward sale agreement physically, receiving cash proceeds equal to the forward sale price. Alternatively, Welltower may choose to cash settle or net share settle, which may result in no proceeds or an obligation to pay cash or shares to the forward purchaser.
The sales of ATM Shares can be conducted through various methods, including ordinary brokers' transactions on the New York Stock Exchange, block transactions, or other agreed methods. The offer and sale of these shares have been registered on Welltower's automatic shelf registration statement on Form S-3, as amended, with a prospectus supplement filed with the Securities and Exchange Commission on October 29, 2024.
This strategic move by Welltower Inc. aims to enhance its financial flexibility and capitalize on market opportunities, providing potential value for investors and stakeholders.
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