By Susanna Moon
Chicago, June 19 – Wells Fargo & Co. priced $55 million principal amount of 0.25% optionally exchangeable securities due June 24, 2022 exchangeable for the class P common stock of Kinder Morgan, Inc., according to a 424B2 filing with the Securities and Exchange Commission.
Interest is payable semiannually.
Each note has a principal amount of $1,000.
Beginning July, investors may exchange their notes for a number of Kinder Morgan shares equal to the exchange ratio, which is initial parity divided by the initial share price. The issuer has the option to settle exchanges in cash instead of shares.
The initial parity was set at $906.618 at pricing. After that, parity will equal the exchange ratio multiplied by the closing share price on that day.
The notes will be callable at the greater of par and parity after three years.
The payout at maturity will be the greater of par and parity.
Wells Fargo Securities LLC is the underwriter.
| Issuer: | Wells Fargo & Co.
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| Issue: | Optionally exchangeable securities
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| Underlying stock: | Kinder Morgan, Inc. (Symbol: KMI)
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| Amount: | $55 million
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| Maturity: | June 24, 2022
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| Coupon: | 0.25%, payable semiannually
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| Price: | Par
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| Payout at maturity: | Greater of par and parity
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| Exchange option: | For 22.97499 Kinder Morgan shares per note beginning July 9
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| Call option: | At greater of par and parity beginning June 25, 2018
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| Initial share price: | $39.46109, which is based on an intra-day price of stock on pricing date
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| Parity: | $906.618 initially; after that, exchange ratio multiplied by closing share price
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| Pricing date: | June 17
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| Settlement date: | June 24
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| Agent: | Wells Fargo Securities LLC
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| Fees: | None
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| Cusip: | 94986RXR7
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