WELLTOWER INC.WELL
WELLTOWER INC. Stock Compensation Disclosure
Stock Incentive Plans
In March 2022, our Board of Directors approved the 2022 Long-Term Incentive Plan (“2022 Plan”), which initially authorized up to 10,000,000 shares of common stock to be issued at the discretion of the Compensation Committee of the Board. Awards granted after March 28, 2022 are issued out of the 2022 Plan. The awards granted under the 2016 Long-Term Incentive Plan continue to vest and options expire ten years from the date of grant. Our non-employee directors, officers and key employees are eligible to participate in the 2022 Plan. The 2022 Plan allows for the issuance of, among other things, stock options, stock appreciation rights, restricted stock units, deferred stock units, performance units and dividend equivalent rights. Vesting periods for options, deferred stock units and restricted stock units generally range from to five years. Options expire ten years from the date of grant. In April 2025, our Board of Directors adopted, subject to shareholder approval obtained in May 2025, an amendment to the 2022 Plan (the “Amended and Restated Plan”), primarily to increase the aggregate number of shares of common stock authorized for issuance by 10,000,000 shares, bringing the total of shares authorized under the plan to 20,000,000 shares.
Under our long-term incentive plan, restricted stock unit awards are market, performance or time-based. For market and performance-based awards, we will grant a target number of restricted stock units, with the ultimate award determined by the total shareholder return and operating performance metrics, measured in each case over a measurement period of to five years. Performance-based awards vest after the end of the performance periods, generally within one year following the
conclusion of such period. The expected term represents the period from the grant date through the applicable vesting date. Compensation expense for performance-based awards is measured based on the probability of achievement of certain performance goals and is recognized over the requisite service period. For the portion of the grant for which the award is determined by the operating performance metrics, the compensation cost is based on the grant date closing price and management’s estimate of corporate achievement of the financial metrics. If the estimated number of performance-based restricted stock units to be earned changes, an adjustment will be recorded to recognize the accumulated difference between the revised and previous estimates. For the portion of the grant determined by the total shareholder return (“TSR”), management uses a Monte Carlo model to assess the fair value and compensation cost. For time-based awards, the fair value of the restricted stock units is equal to the market price of our common stock on the date of grant and is amortized over the vesting periods. For purposes of measuring stock-based compensation expense, we consider whether an adjustment to the observable market price is necessary to reflect material nonpublic information that is known to us at the time the award is granted. No adjustments were deemed necessary for the years ended December 31, 2025, 2024 or 2023. Forfeitures are accounted for as they occur.
The following table summarizes compensation expense recognized for the periods presented (in thousands):
| Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Stock options | $ | 9,646 | $ | 16,837 | $ | 2,741 | ||||||||||||||
| Restricted stock units | 138,414 | 58,984 | 34,458 | |||||||||||||||||
| LTIP Units - Ten Year Program | 1,408,672 | — | — | |||||||||||||||||
| Total compensation expense | $ | 1,556,732 | $ | 75,821 | $ | 37,199 | ||||||||||||||
Stock Options
No stock options were granted during the year ended December 31, 2025. As of December 31, 2025, there were 1,412,420 stock options outstanding, of which 1,077,006 were exercisable. As of December 31, 2025, there was $1,705,000 of total unrecognized compensation expense related to unvested stock options that is expected to be recognized over a weighted average period of one year.
During the year ended December 31, 2024, the performance goal associated with performance-based stock options granted in December 2021 became probable and was ultimately achieved, resulting in the recognition of $14,073,000 of stock compensation expense, including a cumulative catch up adjustment.
Restricted Stock Units
During the year ended December 31, 2025, we granted 459,249 restricted stock units with a weighted average grant date fair value of $174.51. We used a Monte Carlo model to assess the compensation cost associated with the portion of the market awards granted for which achievement will be determined using TSR measures. The model also considers a post-vesting holding period. The assumptions used and estimated grant-date award values are as follows:
| 2025 | ||||||||
| Dividend yield | 2.15% | |||||||
Estimated volatility over the life of the plan(1) | 22.02% - 25.13% | |||||||
| Risk free rate | 4.49% - 4.38% | |||||||
| Discount for lack of marketability | 14.62% - 15.10% | |||||||
| Estimated grant date award value per target unit | $119.31 - $199.38 | |||||||
(1) Estimated volatility over the life of the plan is using 50% historical volatility and 50% implied volatility.
As of December 31, 2025, there were 608,033 unvested restricted stock units. This amount excludes performance-based restricted stock units for which continued service-based vesting conditions were waived during the year. The accounting effects of these award modifications are discussed further below. As of December 31, 2025, there was $23,253,000 of total unrecognized compensation expense related to unvested restricted stock units that is expected to be recognized over a weighted average period of two years.
During the year ended December 31, 2024, the performance goal associated with certain performance-based restricted stock unit awards granted in January 2022 became probable and then was ultimately achieved, resulting in the recognition of stock compensation expense of $19,341,000, including a cumulative catch up adjustment.
Year Program LTIP Units
On October 26, 2025, our Board of Directors adopted the Year Executive Continuity and Alignment Program (the “Executive Ten Year Program”). The Executive Ten Year Program is part of a broader reconfiguration of our executive compensation program, which includes new equity-based incentive awards and changes to our existing executive compensation programs and is intended to be the primary executive compensation program for our executive leadership team for the next
decade. Under the Executive Ten Year Program, an award of LTIP Units of Welltower OP (which are intended to be treated as profits interests for U.S. federal income tax purposes and, subject to achievement of certain conditions described below, may become redeemable, and may be redeemed, for shares of Welltower common stock as further described below), to each of our named executive officers (the “Executives” and such awards, the “Executive LTIP Unit Awards”) has been approved by our Board of Directors as described in more detail in item 5.02 of our Current Report on Form 8-K filed on October 27, 2025.
The Executive LTIP Unit Awards will be subject to restrictions on redemption and transferability, certain punitive repurchase mechanisms and to clawback in certain circumstances. The Executive LTIP Unit Awards, except in the case of termination of employment under certain circumstances or a Change in Corporate Control (generally, as defined in the Amended and Restated Plan), will not be redeemable for shares of Welltower common stock until October 31, 2030 at the earliest, at which point they will become redeemable in substantially equal monthly installments through September 30, 2035. One-half of the Executive LTIP Unit Awards (the “Performance-Based LTIP Units”) will be subject to forfeiture if certain predetermined performance milestones are not achieved over a five-year performance period commencing on October 6, 2025 and ending on October 5, 2030 (the “Performance Period”). One-half of the Executive LTIP Unit Awards are not subject to achievement of predetermined performance milestones (the “Time-Based LTIP Units”). None of the Executive LTIP Unit Awards will be subject to any service-based vesting conditions.
Upon an Executive’s resignation other than due to a Qualifying Termination (as defined in the Executive LTIP Unit Awards), (i) any portion of the Executive LTIP Unit Award that is not then redeemable will be subject to an automatic delay of the Executive’s right to redeem the Executive LTIP Unit Award for shares of Welltower common stock and restrictions with respect to future distributions thereon until (a) for Mr. Mitra, 15 years following the grant date, and (b) for all other Executives, 20 years following the grant date (as applicable, the “Extended Redemption Date”), and (ii) if the resignation occurs prior to the end of the Performance Period, Mr. Mitra’s Time-Based LTIP Units and all associated distributions will be subject to clawback, unless Welltower’s total shareholder return (“TSR”) is positive as of the end of the Performance Period. In addition, upon the Executive’s resignation other than due to a Qualifying Termination, Welltower OP will have the discretionary right, during the applicable period commencing on the later of the date of resignation or the second calendar day following the six month anniversary of the grant and ending on the Extended Redemption Date, to repurchase all or any portion of the Executive LTIP Unit Award that is not then redeemable at its fair market value at the time that the repurchase right is exercised, which may include discounts for lack of transferability through the applicable Extended Redemption Date, lack of marketability due to the delay in redemption rights, time value of money and minority interest.
One-half of the Performance-Based LTIP Units will become eligible to be earned subject to Welltower’s TSR relative to the TSR of each of the FTSE NAREIT Healthcare Index, the MSCI US REIT Index and the S&P 500 Index (in each case, removing Welltower from each index in calculating each index return) equally weighted, over the Performance Period. One-half of the Performance-Based LTIP Units will become eligible to be earned subject to Welltower’s achievement of certain market capitalization milestones over any 60 consecutive calendar-day period during years four and five of the Performance Period; provided, however, for purposes of determining the number of shares used for determining achievement of the market capitalization milestone, new share issuances under our ATM Program will be limited, with the intention that at least 50% of any increase in daily market capitalization that counts toward achievement of the milestones is attributable to share price appreciation, and in all cases no portion of the market capitalization linked Performance-Based LTIP Unit award will be earned if Welltower does not achieve a positive TSR as of the end of the Performance Period.
On December 31, 2025, our Compensation Committee adopted the Ten Year Key Employee Continuity and Alignment Program (together with the Executive Ten Year Program, the “Ten Year Program”). LTIP Units of Welltower OP were granted to certain other key employees under the Ten Year Program (the “Key Employees” and such awards, the “Key Employee LTIP Unit Awards”). The Key Employee LTIP Unit Awards generally contain terms substantially similar to the Executive LTIP Unit Awards, including performance-based conditions measured over the same five-year performance period applicable to the Executive LTIP Unit Awards. A portion of the Key Employee LTIP Unit Awards is subject to the same total shareholder return and market capitalization performance conditions applicable to the Executive LTIP Unit Awards described above. The Key Employee LTIP Unit Awards are also subject to restrictions on redemption and transferability that are the same as those applicable to the Executive LTIP Unit Awards held by Executives other than Mr. Mitra, and include resignation-related provisions that are the same as those applicable to the Executive LTIP Unit Awards held by Executives other than Mr. Mitra, and, except in the case of termination of employment under certain circumstances or a Change in Corporate Control, are not redeemable for shares of Welltower common stock until December 31, 2030, at which point they become redeemable in substantially equal monthly installments through November 29, 2035.
The following table summarizes LTIP Units granted in 2025 under the Ten Year Program:
| Grant | Time-Based LTIP Units | Performance-Based LTIP Units (Target) | Total LTIP Units (Target) | |||||||||||||||||
| Executives | 4,084,781 | 4,084,781 | 8,169,562 | |||||||||||||||||
| Key Employees | 525,000 | 1,575,000 | 2,100,000 | |||||||||||||||||
| Total | 4,609,781 | 5,659,781 | 10,269,562 | |||||||||||||||||
Awards granted to Executives and Key Employees under the Year Program are classified as equity awards under ASC 718. The awards are fully vested on the date of grant for accounting purposes but remain subject to redemption restrictions to the extent service-based requirements have not been met and to market conditions being achieved with respect to Performance-Based LTIP Units.
Grant-date fair value was measured for multiple potential outcomes using a Monte Carlo simulation model. The model incorporates assumptions related to expected volatility, risk-free interest rates, dividend yield, correlations among Welltower’s stock and relevant indices, expected share issuances, transfer restrictions, and discounts for lack of marketability and liquidity risk. Separate grant-date fair values were estimated for multiple potential outcomes, including scenarios reflecting continued employment and extended transfer restrictions. Compensation cost recognized on the grant date reflects the award’s fair value assuming subsequent service provided by the grantee is insufficient to earn the relief of redemption and transferability restrictions prior to the Extended Redemption Date. Incremental compensation cost is recognized over the ten-year period during which the related service conditions affecting restrictions on redemption and transferability and market-condition removal are satisfied. During the year ended December 31, 2025, we recognized $1,408,672,000 in stock compensation expense related to the LTIP Units granted under the Ten Year Program. As of December 31, 2025, there was $269,510,000 of total unrecognized compensation expense related to the LTIP Units granted under the Ten Year Program that is expected to be recognized through 2035 over a weighted average period of four years.
The following table summarizes key assumptions and estimated grant-date award values used in the Monte Carlo valuation of LTIP Units granted under the Ten Year Program:
| Executive | Key Employee | ||||||||||
| Dividend yield | 2.50% | 2.50% | |||||||||
Estimated volatility over the life of the plan(1) | 24.10% - 31.00% | 24.50% - 31.50% | |||||||||
| Risk free rate | 3.45% - 4.54% | 3.61% - 4.78% | |||||||||
| Discount for lack of marketability | 12.50% - 27.00% | 12.50% - 27.50% | |||||||||
| Estimated grant date award value | $98.98 - $175.21 | $134.57 - $200.35 | |||||||||
(1) Estimated volatility over the life of the plan is using 50% historical volatility and 50% implied volatility.
Additionally, in connection with the grant of the LTIP units under the Ten Year Program, our Board of Directors approved a global amendment to the 2024-2026 LTIP plan and the 2025-2027 LTIP plan (collectively the “Prior Awards”) previously granted under the Amended and Restated Plan to the individuals who were granted LTIP Units under the Ten Year Program, waiving the continued service-based vesting conditions with respect to all performance based grants under the Prior Awards, effective as of October 30, 2025 for awards held by the Executives and effective as of December 31, 2025 for awards held by the Key Employees. Except as expressly provided by such amendment, all equity or equity-based awards held by the individuals who were granted LTIP Units under the Ten Year Program and that were outstanding as of the applicable amendment date remain in effect in accordance with their terms, including the performance conditions and market conditions associated with such awards. During the year ended December 31, 2025, we recognized $64,894,000 of incremental expense in conjunction with these amendments.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 12, 2026 | Showing above |
| 2024 | Feb 12, 2025 | |
| 2023 | Feb 15, 2024 | |
| 2022 | Feb 21, 2023 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.