Summary
Wells Fargo & Company/MN (WFC) filed an 8-K on November 19, 2012, to report on the creation and subsequent sale of a new series of preferred stock. Specifically, the company filed a Certificate of Designation on November 19, 2012, establishing "Non-Cumulative Perpetual Class A Preferred Stock, Series O." This series has a substantial liquidation preference of $25,000 per share and an authorization of 27,600 shares. The following day, November 20, 2012, Wells Fargo announced the sale of 26,000,000 Depositary Shares. Each Depositary Share represents a 1/1,000th interest in a share of the Series O Preferred Stock. This action indicates the company's strategic use of preferred equity to potentially strengthen its capital position or fund operations. Investors should note the non-cumulative nature of the dividends, meaning dividend payments are not carried forward if not declared in a given period.
Key Highlights
- 1Wells Fargo established a new series of preferred stock, "Non-Cumulative Perpetual Class A Preferred Stock, Series O," effective November 19, 2012.
- 2The Series O Preferred Stock has a liquidation preference of $25,000 per share.
- 3The company filed a Certificate of Designation with the Delaware Secretary of State to authorize this new series.
- 4On November 20, 2012, Wells Fargo sold 26,000,000 Depositary Shares, each representing a 1/1,000th interest in the Series O Preferred Stock.
- 5The filing includes several exhibits detailing the underwriting agreement, certificate of designation, deposit agreement, and related legal opinions.
- 6The dividends on the Series O Preferred Stock are non-cumulative.