What are 'Principal at Risk Securities'?

'Principal at Risk Securities' are a type of investment where the repayment of the principal amount is not guaranteed and is subject to the performance of an underlying asset, such as an index or a basket of assets. If the underlying asset performs poorly, investors may lose a portion or all of their initial principal investment.

What is the role of Wells Fargo & Company's guarantee?

Wells Fargo & Company's full and unconditional guarantee means that the parent company is committed to ensuring that the obligations of Wells Fargo Finance LLC under these Notes are met. This provides an added layer of credit support for the investors.

What is the significance of filing the legal opinion?

Filing the legal opinion from Faegre Drinker Biddle & Reath LLP confirms the legality and enforceability of the issued Notes and the Guarantee. This is a standard procedure for debt issuances and provides investors with assurance regarding the legal standing of their investment.

Are these Notes suitable for all investors?

Given the 'Principal at Risk' nature, these Notes are generally suitable for investors who understand the associated risks, including the potential loss of principal, and are comfortable with complex financial instruments linked to market performance. Investors should consult with a financial advisor to determine suitability.

WELLS FARGO & COMPANY/MN 8-K SEC Disclosure

Summary

Wells Fargo & Company/MN (WFC) filed an 8-K report on March 30, 2020, to disclose the issuance of new Medium-Term Notes, Series A. These notes, guaranteed by Wells Fargo & Company, are structured as "Principal at Risk Securities" and are linked to either the S&P 500® Index or a basket of one index and two ETFs, with a maturity date of March 28, 2025. This filing primarily serves to formally submit the documentation related to these new debt instruments, including the forms of the Notes and the legal opinion from Faegre Drinker Biddle & Reath LLP concerning their validity and the Guarantee. Investors should note that the 'Principal at Risk' nature of these securities means that their principal repayment is subject to the performance of the linked index or basket, implying a higher risk profile compared to traditional fixed-income investments.

Key Highlights

1Wells Fargo Finance LLC issued new "Principal at Risk Securities" (Medium-Term Notes, Series A).
2The Notes are linked to the performance of the S&P 500® Index or a basket of one index and two ETFs.
3The maturity date for these Notes is March 28, 2025.
4Wells Fargo & Company provides a full and unconditional guarantee for these Notes.
5The filing includes the forms of the Notes and a legal opinion from Faegre Drinker Biddle & Reath LLP.
6The 'Principal at Risk' structure suggests potential loss of principal if market performance is unfavorable.

WELLS FARGO & COMPANY/MN 8-K Report, Exhibit Filing (Mar 30, 2020)

Summary

Key Highlights

Frequently Asked Questions