What are Principal at Risk Securities?

Principal at Risk Securities are investment products where the repayment of the principal amount is not guaranteed and can be reduced or eliminated based on the performance of an underlying asset, index, or other benchmark. In this case, the S&P 500® Index performance determines the extent to which the principal is at risk.

What is the role of the S&P 500® Index in these notes?

The S&P 500® Index serves as the underlying benchmark for these Medium-Term Notes. The return and, critically, the potential loss of principal on these notes are directly tied to the performance of the S&P 500® Index over the life of the notes.

Why is a legal opinion from Faegre Baker Daniels LLP included?

The legal opinion is included to provide assurance to investors and regulators that the structure and terms of the Medium-Term Notes are legally sound and compliant with relevant regulations. It confirms the legal standing of the securities being offered.

What is the significance of the Form S-3 filing mentioned?

The reference to a Registration Statement on Form S-3 indicates that Wells Fargo had previously filed this form with the SEC. Form S-3 allows established public companies to register securities offerings more efficiently. This 8-K filing is essentially providing the specific details and documentation for a particular series of notes being issued under that broader registration.

WELLS FARGO & COMPANY/MN 8-K SEC Disclosure

Summary

This Form 8-K filing by Wells Fargo & Company (WFC) on December 8, 2016, primarily concerns the issuance of new financial products and the associated legal documentation. Specifically, the company has issued Medium-Term Notes, Series K, which are structured as Principal at Risk Securities linked to the performance of the S&P 500® Index. These notes represent a specific type of debt instrument where the principal repayment is contingent on the index's performance. For investors, this filing signals the introduction of new investment products by Wells Fargo. The 'Principal at Risk' nature of these notes is a critical factor, meaning investors could lose a portion or all of their principal investment if the S&P 500® Index underperforms. The filing includes the forms of these notes and a legal opinion from Faegre Baker Daniels LLP, confirming the legality and structure of these offerings. Investors considering these notes should carefully review the terms and conditions, particularly the risk factors associated with market-linked investments.

Key Highlights

1Wells Fargo & Company (WFC) issued Medium-Term Notes, Series K, on December 8, 2016.
2These notes are classified as Principal at Risk Securities.
3The performance of these notes is linked to the S&P 500® Index.
4The filing includes the specific forms of the issued Medium-Term Notes.
5A legal opinion from Faegre Baker Daniels LLP regarding the notes is also included.
6This filing is related to a Registration Statement on Form S-3 previously filed by WFC.

WELLS FARGO & COMPANY/MN 8-K Report, Exhibit Filing (Dec 8, 2016)

Summary

Key Highlights

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