Summary
This Form 8-K filing by Wells Fargo & Company/MN (WFC) on July 22, 2013, primarily reports on the designation and subsequent sale of a new series of preferred stock. The company officially designated 69,000 shares of "Non-Cumulative Perpetual Class A Preferred Stock, Series Q" on July 19, 2013. This new series carries a liquidation preference of $25,000 per share. Following the designation, on July 22, 2013, Wells Fargo completed the sale of 69,000,000 Depositary Shares. Each Depositary Share represents a 1/1,000th interest in a share of the Series Q Preferred Stock. This issuance is part of the company's ongoing capital management activities and provides additional details on the terms and conditions of this new preferred stock offering.
Key Highlights
- 1Wells Fargo & Company/MN (WFC) designated a new series of preferred stock: "Non-Cumulative Perpetual Class A Preferred Stock, Series Q".
- 269,000 shares of Series Q Preferred Stock were authorized, with a liquidation preference of $25,000 per share.
- 3On July 22, 2013, the company sold 69,000,000 Depositary Shares.
- 4Each Depositary Share represents a 1/1,000th interest in a share of the Series Q Preferred Stock.
- 5The filing includes the Certificate of Designation for the Series Q Preferred Stock.
- 6Various agreements and opinions related to the issuance, including the Underwriting Agreement and Deposit Agreement, are filed as exhibits.
- 7This issuance is in connection with a Registration Statement on Form S-3 previously filed by the company.
Frequently Asked Questions
This is a newly designated series of preferred stock by Wells Fargo. It is non-cumulative, meaning dividends are not carried forward if not declared in a particular period. It is perpetual, suggesting no maturity date, and has a liquidation preference of $25,000 per share.
Wells Fargo sold Depositary Shares, each representing a fractional interest in the Series Q Preferred Stock, likely to broaden investor access and facilitate trading in smaller denominations compared to the high per-share liquidation preference of the preferred stock itself.
Key exhibits filed include the Underwriting Agreement for the sale, the Certificate of Designation for the Series Q Preferred Stock, the Deposit Agreement governing the Depositary Shares, a form of Depositary Receipt, and legal opinions related to these instruments.
Preferred stock generally has a priority claim over common stock for dividends and liquidation distributions. While this issuance adds to the company's capital structure, the specific impact on common stockholders would depend on factors like the dividend rate, the company's earnings, and future capital needs.