What are "Principal at Risk Securities"?

Principal at Risk Securities are investment instruments where the repayment of the principal amount is not guaranteed and is dependent on the performance of an underlying asset, index, or ETF. If the underlying asset performs poorly, investors may lose a portion or all of their initial investment.

What are the specific risks associated with these new Wells Fargo notes?

The primary risk is the potential loss of principal. For the note linked to the iShares® MSCI Emerging Markets ETF, investors are exposed to the volatility and risks of emerging market economies. For the note linked to the Energy Select Sector SPDR® Fund, investors face the risks inherent in the energy sector, which can be influenced by commodity prices, geopolitical events, and regulatory changes. Both notes carry the risk that the underlying ETFs underperform, leading to a reduction in the principal returned to the investor.

Where can I find the detailed terms and conditions of these notes?

The detailed terms and conditions are contained within the exhibits filed with this 8-K report. Specifically, Exhibit 4.1 provides the form of the note linked to the iShares® MSCI Emerging Markets ETF, and Exhibit 4.2 provides the form of the note linked to the Energy Select Sector SPDR® Fund. Investors should consult these documents for a complete understanding of the investment.

Is this filing related to Wells Fargo's overall financial health or performance?

No, this 8-K filing is specific to the issuance of new structured note products and does not directly provide information on Wells Fargo's overall financial performance, profitability, or operational results. It is a disclosure related to a particular financial product being offered by the company.

WELLS FARGO & COMPANY/MN 8-K SEC Disclosure

Summary

This 8-K filing from Wells Fargo & Company (WFC) on August 7, 2018, primarily serves to disclose the details of two new issuances of Medium-Term Notes, Series S, designated as "Principal at Risk Securities." These notes are linked to the performance of specific exchange-traded funds: the iShares® MSCI Emerging Markets ETF and the Energy Select Sector SPDR® Fund. The filing includes the forms of these notes and the legal opinion from Faegre Baker Daniels LLP regarding their issuance. For investors, the key takeaway is the introduction of new structured note products. The "Principal at Risk" designation is critical, indicating that the repayment of principal is subject to the performance of the underlying ETFs. This means investors could lose a portion or all of their principal if the ETFs underperform. Investors considering these notes should carefully evaluate the risks associated with emerging markets (for the iShares® MSCI Emerging Markets ETF) and the energy sector (for the Energy Select Sector SPDR® Fund), as well as the specific terms and conditions detailed in the note forms.

Key Highlights

1Wells Fargo issued new Medium-Term Notes, Series S, identified as 'Principal at Risk Securities'.
2These notes are linked to the performance of two specific ETFs: iShares® MSCI Emerging Markets ETF and Energy Select Sector SPDR® Fund.
3The filing provides the official forms for both ETF-linked 'Principal at Risk' note issuances.
4A legal opinion from Faegre Baker Daniels LLP concerning these notes is included.
5The 'Principal at Risk' nature of these securities means investors can lose their principal investment based on ETF performance.
6Maturity dates for the notes are August 7, 2023 (Emerging Markets ETF) and August 9, 2021 (Energy Sector SPDR® Fund).

WELLS FARGO & COMPANY/MN 8-K Report, Exhibit Filing (Aug 7, 2018)

Summary

Key Highlights

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