Document:

WELLS FARGO & COMPANY 8-K

 

 

 Exhibit
4.1

 

 

[Face
of Note]

 

Unless
this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”),
to the Company or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the
name of Cede & Co. or in such other name as requested by an authorized representative of DTC (and any payment is made to Cede & Co. or such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.

	CUSIP
NO. 95001HD24	FACE AMOUNT: $_________

REGISTERED
NO. ___

 

 

WELLS
FARGO FINANCE LLC

 

MEDIUM-TERM
NOTE, SERIES A

Fully
and Unconditionally Guaranteed by Wells Fargo & Company

 

Principal
at Risk Securities Linked to the EURO STOXX 50® Index

 

WELLS
FARGO FINANCE LLC, a limited liability company duly organized and existing under the laws of the State of Delaware (hereinafter
called the “Company,” which term includes any successor corporation under and as defined in the Indenture hereinafter
referred to), for value received, hereby promises to pay to CEDE & Co., or registered assigns, an amount equal to the
Cash Settlement Amount (as defined below), in such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts, on the Stated Maturity Date. The “Stated Maturity Date”
shall be February 4, 2022. If the Determination Date (as defined below) is postponed, the Stated Maturity Date will be postponed
to the second Business Day (as defined below) after the Determination Date as postponed. This Security shall not bear any interest.

Any
payments on this Security at Maturity will be made against presentation of this Security at the office or agency of the Company
maintained for that purpose in the City of Minneapolis, Minnesota and at any other office or agency maintained by the Company
for such purpose. 

“Face
Amount” shall mean, when used with respect to this Security, the amount set forth on the face of this Security as its
“Face Amount.”

Determination
of Cash Settlement Amount and Certain Definitions

The
“Cash Settlement Amount” of this Security will equal:

 

		•	if
                                         the Final Underlier Level is greater than or equal to the Threshold Level, the Maximum
                                         Settlement Amount; or

 

    	 	 	 

    	 

    

		•	if
                                         the Final Underlier Level is less than the Threshold Level, the sum of (i) the Face
                                         Amount plus (ii) the product of (a) the Buffer Rate times (b) the sum
                                         of the Underlier Return plus the Threshold Amount times (c) the Face Amount.

 

All
calculations with respect to the Cash Settlement Amount will be rounded to the nearest one hundred-thousandth, with five one-millionths
rounded upward (e.g., 0.000005 would be rounded to 0.00001); and the Cash Settlement Amount will be rounded to the nearest
cent, with one-half cent rounded upward.

 

The
“Underlier” shall mean the EURO STOXX 50® Index.

 

The
“Trade Date” shall mean December 9, 2019.

 

The
“Initial Underlier Level” is 3,672.18, the Closing Level of the Underlier on the Trade Date.

 

The
“Closing Level” of the Underlier on any Trading Day means the official closing level of the Underlier reported
by the Underlier Sponsor on such Trading Day, as obtained by the Calculation Agent on such Trading Day from the licensed third-party
market data vendor contracted by the Calculation Agent at such time; in particular, taking into account the decimal precision
and/or rounding convention employed by such licensed third-party market data vendor on such date, subject to the provisions set
forth below under “Adjustments to the Underlier,” “Discontinuance of the Underlier” and “Market
Disruption Events.”

 

The
“Final Underlier Level” will be the Closing Level of the Underlier on the Determination Date.

 

The
“Underlier Return” will be the quotient of (i) the Final Underlier Level minus the Initial Underlier Level
divided by (ii) the Initial Underlier Level, expressed as a percentage.

 

The
“Threshold Level” is 3,121.353, which is equal to 85% of the Initial Underlier Level.

 

The
“Threshold Amount” is 15%.

 

The
“Maximum Settlement Amount” is 114.50% of the Face Amount of this Security.

 

The
“Buffer Rate” is equal to the Initial Underlier Level divided by the Threshold Level.

 

“Underlier
Sponsor” shall mean STOXX Limited.

 

“Business
Day” shall mean a day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions
are authorized or required by law or regulation to close in New York, New York.

 

    	 	2	 

    	 

    

A
“Trading Day” means a day, as determined by the Calculation Agent, on which (i) the Underlier Sponsor
is scheduled to publish the level of the Underlier and (ii) each Related Futures or Options Exchange is scheduled to be open for
trading for its regular trading session.

 

The
“Relevant Stock Exchange” for any security underlying the Underlier means the primary exchange or quotation
system on which such security is traded, as determined by the Calculation Agent.

 

The
“Related Futures or Options Exchange” for the Underlier means an exchange or quotation system where trading
has a material effect (as determined by the Calculation Agent) on the overall market for futures or options contracts relating
to the Underlier.

 

The
“Determination Date” shall be February 2, 2022. If the originally scheduled Determination Date is not a Trading
Day, the Determination Date will be postponed to the next succeeding Trading Day. The Determination Date is also subject to postponement
due to the occurrence of a Market Disruption Event (as defined below). See “–Market Disruption Events.”

 

“Calculation
Agent Agreement” shall mean the Calculation Agent Agreement dated as of May 18, 2018 between the Company and the Calculation
Agent, as amended from time to time.

 

“Calculation
Agent” shall mean the Person that has entered into the Calculation Agent Agreement with the Company providing for, among
other things, the determination of the Final Underlier Level and the Cash Settlement Amount, which term shall, unless the context
otherwise requires, include its successors under such Calculation Agent Agreement. The initial Calculation Agent shall be Wells
Fargo Securities, LLC. Pursuant to the Calculation Agent Agreement, the Company may appoint a different Calculation Agent from
time to time after the initial issuance of this Security without the consent of the Holder of this Security and without notifying
the Holder of this Security.

 

Adjustments
to the Underlier

If
at any time the method of calculating the Underlier or a Successor Underlier, or the closing level thereof, is changed in a material
respect, or if the Underlier or a Successor Underlier is in any other way modified so that such underlier does not, in the opinion
of the Calculation Agent, fairly represent the level of such underlier had those changes or modifications not been made, then
the Calculation Agent will, at the close of business in New York, New York, on each date that the closing level of such underlier
is to be calculated, make such calculations and adjustments as, in the good faith judgment of the Calculation Agent, may be necessary
in order to arrive at a level of an underlier comparable to the Underlier or Successor Underlier as if those changes or modifications
had not been made, and the Calculation Agent will calculate the closing level of the Underlier or Successor Underlier with reference
to such underlier, as so adjusted. Accordingly, if the method of calculating the Underlier or Successor Underlier is modified
so that the level of such underlier is a fraction or a multiple of what it would have been if it had not been modified (e.g.,
due to a split or reverse split in such equity underlier), then the Calculation Agent will adjust the Underlier or Successor Underlier
in order to arrive at a level of such underlier as if it had not been modified (e.g., as if the split or reverse split had not
occurred).

    	 	3	 

    	 

    

Discontinuance
of the Underlier

If
the Underlier Sponsor discontinues publication of the Underlier, and the Underlier Sponsor or another entity publishes a successor
or substitute equity index that the Calculation Agent determines, in its sole discretion, to be comparable to the Underlier (a
“Successor Underlier”), then, upon the Calculation Agent’s notification of that determination to the
Trustee and the Company, the Calculation Agent will substitute the Successor Underlier as calculated by the relevant Underlier
Sponsor or any other entity and calculate the Final Underlier Level as described above. Upon any selection by the Calculation
Agent of a Successor Underlier, the Company will cause notice to be given to the Holder of this Security.

In
the event that the Underlier Sponsor discontinues publication of the Underlier prior to, and the discontinuance is continuing
on, the Determination Date and the Calculation Agent determines that no Successor Underlier is available at such time, the Calculation
Agent will calculate a substitute Closing Level for the Underlier in accordance with the formula for and method of calculating
the Underlier last in effect prior to the discontinuance, but using only those securities that comprised the Underlier immediately
prior to that discontinuance. If a Successor Underlier is selected or the Calculation Agent calculates a level as a substitute
for the Underlier, the Successor Underlier or level will be used as a substitute for the Underlier for all purposes, including
the purpose of determining whether a Market Disruption Event exists.

If
on the Determination Date the Underlier Sponsor fails to calculate and announce the level of the Underlier, the Calculation Agent
will calculate a substitute Closing Level of the Underlier in accordance with the formula for and method of calculating the Underlier
last in effect prior to the failure, but using only those securities that comprised the Underlier immediately prior to that failure;
provided that, if a Market Disruption Event occurs or is continuing on such day, then the provisions set forth below under
“Market Disruption Events” shall apply in lieu of the foregoing.

Market
Disruption Events 

A
“Market Disruption Event” means any of (A), (B), (C) or (D) below, as determined by the Calculation Agent in
its sole discretion:

 

		(A)	Any
                                         of the following events occurs or exists with respect to any security included in the
                                         Underlier or any Successor Underlier, and the aggregate of all securities included in
                                         the Underlier or Successor Underlier with respect to which any such event occurs comprise
                                         20% or more of the level of the Underlier or Successor Underlier:

		•	a
                                         material suspension of or limitation imposed on trading by the Relevant Stock Exchange
                                         for such security or otherwise at any time during the one-hour period that ends at the
                                         Scheduled Closing Time for the Relevant Stock Exchange for such security on that day,
                                         whether by reason of movements in price exceeding limits permitted by the Relevant Stock
                                         Exchange or otherwise;

•

any event, other than an early closure, that materially disrupts or impairs the ability of market participants in general to effect
transactions in, or obtain

 

    	 	4	 

    	 

    

market
values for, such security on its Relevant Stock Exchange at any time during the one-hour period that ends at the Scheduled Closing
Time for the Relevant Stock Exchange for such security on that day; or

		•	the
                                         closure on any Exchange Business Day of the Relevant Stock Exchange for such security
                                         prior to its Scheduled Closing Time unless the earlier closing is announced by such Relevant
                                         Stock Exchange at least one hour prior to the earlier of (i) the actual closing time
                                         for the regular trading session on such Relevant Stock Exchange and (ii) the submission
                                         deadline for orders to be entered into the Relevant Stock Exchange system for execution
                                         at the Scheduled Closing Time for such Relevant Stock Exchange on that day.

		(B)	Any
                                         of the following events occurs or exists with respect to futures or options contracts
                                         relating to the Underlier or any Successor Underlier:

		•	a
                                         material suspension of or limitation imposed on trading by any Related Futures or Options
                                         Exchange or otherwise at any time during the one-hour period that ends at the close of
                                         trading on such Related Futures or Options Exchange on that day, whether by reason of
                                         movements in price exceeding limits permitted by the Related Futures or Options Exchange
                                         or otherwise;

		•	any
                                         event, other than an early closure, that materially disrupts or impairs the ability of
                                         market participants in general to effect transactions in, or obtain market values for,
                                         futures or options contracts relating to the Underlier or Successor Underlier on any
                                         Related Futures or Options Exchange at any time during the one-hour period that ends
                                         at the close of trading on such Related Futures or Options Exchange on that day; or

		•	the
                                         closure on any Exchange Business Day of any Related Futures or Options Exchange prior
                                         to its Scheduled Closing Time unless the earlier closing time is announced by such Related
                                         Futures or Options Exchange at least one hour prior to the earlier of (i) the actual
                                         closing time for the regular trading session on such Related Futures or Options Exchange
                                         and (ii) the submission deadline for orders to be entered into the Related Futures or
                                         Options Exchange system for execution at the close of trading for such Related Futures
                                         or Options Exchange on that day.

		(C)	The
                                         underlier sponsor fails to publish the level of the Underlier or any Successor Underlier
                                         (other than as a result of the underlier sponsor having discontinued publication of the
                                         Underlier or Successor Underlier and no Successor Underlier being available).

		(D)	Any
                                         Related Futures or Options Exchange fails to open for trading during its regular trading
                                         session.

For
purposes of determining whether a Market Disruption Event has occurred:

(1)

the relevant percentage contribution of a security included in the Underlier or any
Successor Underlier to the level of such underlier will be based on a comparison of (x) the portion of the level of such
underlier attributable to that security to (y) the overall level of such underlier, in each case using the official opening
weightings as published by the underlier sponsor as part of the market opening data;

    	 	5	 

    	 

    

(2)

the “Scheduled Closing Time” of any Relevant Stock Exchange or Related
Futures or Options Exchange on any Trading Day means the scheduled weekday closing time of such Relevant Stock Exchange or Related
Futures or Options Exchange on such Trading Day, without regard to after hours or any other trading outside the regular trading
session hours; and

(3)

an “Exchange Business Day” means any Trading Day on which (i) the
underlier sponsor publishes the level of the Underlier or any Successor Underlier and (ii) each Related Futures or Options
Exchange is open for trading during its regular trading session, notwithstanding any Related Futures or Options Exchange closing
prior to its Scheduled Closing Time.

If
a Market Disruption Event occurs or is continuing on the Determination Date, then the Determination Date will be postponed to
the first succeeding Trading Day on which a Market Disruption Event has not occurred and is not continuing; however, if such first
succeeding Trading Day has not occurred as of the eighth Trading Day after the originally scheduled Determination Date, that eighth
Trading Day shall be deemed to be the Determination Date. If the Determination Date has been postponed eight Trading Days after
the originally scheduled Determination Date and a Market Disruption Event occurs or is continuing on such eighth Trading Day,
the Calculation Agent will determine the Closing Level of the Underlier on such eighth Trading Day in accordance with the formula
for and method of calculating the Closing Level of the Underlier last in effect prior to commencement of the Market Disruption
Event, using the closing price (or, with respect to any relevant security, if a Market Disruption Event has occurred with respect
to such security, its good faith estimate of the value of such security at the time at which the official Closing Level of the
Underlier is calculated and published by the Underlier Sponsor) on such date of each security included in the Underlier. As used
herein, “closing price” means, with respect to any security on any date, the Relevant Stock Exchange traded
or quoted price of such security as of the time at which the official Closing Level of the Underlier is calculated and published
by the Underlier Sponsor.

Calculation
Agent

The
Calculation Agent will determine the Cash Settlement Amount and the Final Underlier Level. In addition, the Calculation Agent
will (i) determine if adjustments are required to the Closing Level of the Underlier under the circumstances described in this
Security, (ii) if publication of the Underlier is discontinued, select a Successor Underlier or, if no Successor Underlier is
available, determine the Closing Level of the Underlier under the circumstances described in this Security, and (iii) determine
whether a Market Disruption Event or non-Trading Day has occurred.

The
Company covenants that, so long as this Security is Outstanding, there shall at all times be a Calculation Agent (which shall
be a broker-dealer, bank or other financial institution) with respect to this Security.

All
determinations made by the Calculation Agent with respect to this Security will be at the sole discretion of the Calculation Agent
and, in the absence of manifest error, will be conclusive for all purposes and binding on the Company and the Holder of this Security.

    	 	6	 

    	 

    

Tax
Considerations

The
Company agrees, and by acceptance of a beneficial ownership interest in this Security each Holder of this Security will be deemed
to have agreed (in the absence of a statutory, regulatory, administrative or judicial ruling to the contrary), for United States
federal income tax purposes to characterize and treat this Security as a prepaid derivative contract that is an “open transaction.”

Redemption
and Repayment

This
Security is not subject to redemption at the option of the Company or repayment at the option of the Holder hereof prior to February
4, 2022. This Security is not entitled to any sinking fund.

Acceleration

If
an Event of Default, as defined in the Indenture, with respect to this Security shall occur and be continuing, the Cash Settlement
Amount (calculated as set forth in the next sentence) of this Security may be declared due and payable in the manner and with
the effect provided in the Indenture. The amount payable to the Holder hereof upon any acceleration permitted under the Indenture
will be equal to the Cash Settlement Amount hereof calculated as provided herein as though the date of acceleration was the Determination
Date.

__________________

Reference
is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

Unless
the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature
or its duly authorized agent under the Indenture referred to on the reverse hereof by manual signature, this Security shall not
be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

[The
remainder of this page has been left intentionally blank]

 

 

    	 	7	 

    	 

    

IN
WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

 

DATED:

 

	 	WELLS FARGO FINANCE LLC
	 	 	 
	 	By:	 	 
	 	 	 	 
	 	 	 	Its:
	 	 	 
	 	Attest:	 
	 	 	 
	 	 	Its:

 

TRUSTEE’S
CERTIFICATE OF AUTHENTICATION

This
is one of the Securities of the series designated therein described in the within-mentioned Indenture.

	 	 	 
	CITIBANK,
    N.A.,	 
	 	as
    Trustee	 
	 	 	 
	By:	 	 
	 	Authorized
    Signature	 
	 	 	 
	 	OR	 
	 	 	 
	WELLS
    FARGO BANK, N.A.,	 
	as
    Authenticating Agent for the Trustee	 
	 	 	 
	By:	 	 
	 	Authorized
    Signature	 

 

    	 	8	 

    	 

    

[Reverse
of Note]

 

 

WELLS
FARGO FINANCE LLC

 

MEDIUM-TERM
NOTE, SERIES A

Fully
and Unconditionally Guaranteed by Wells Fargo & Company

 

Principal
at Risk Securities Linked to the EURO STOXX 50® Index

 

This
Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”), issued
and to be issued in one or more series under an indenture dated as of April 25, 2018, as amended or supplemented from time to
time (herein called the “Indenture”), among the Company, as issuer, Wells Fargo & Company, as guarantor
(the “Guarantor”) and Citibank, N.A., as trustee (herein called the “Trustee,” which term
includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Guarantor,
the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series of the Securities designated as Medium-Term Notes, Series A, of the Company.
The amount payable on the Securities of this series may be determined by reference to the performance of one or more equity-,
commodity- or currency-based indices, exchange traded funds, securities, commodities, currencies, statistical measures of economic
or financial performance, or a basket comprised of two or more of the foregoing, or any other market measure or may bear interest
at a fixed rate or a floating rate. The Securities of this series may mature at different times, be redeemable at different times
or not at all, be repayable at the option of the Holder at different times or not at all and be denominated in different currencies.

The
Securities are issuable only in registered form without coupons and will be either (a) book-entry securities represented
by one or more Global Securities recorded in the book-entry system maintained by the Depositary or (b) certificated securities
issued to and registered in the names of, the beneficial owners or their nominees.

The
Company agrees, to the extent permitted by law, not to voluntarily claim the benefits of any laws concerning usurious rates of
interest against a Holder of this Security.

Guarantee

The
Securities of this series are fully and unconditionally guaranteed by the Guarantor as and to the extent set forth in the Indenture.

Modification
and Waivers 

The
Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations
of the Company and the Guarantor and the rights of the Holders of the Securities of each series to be affected under the Indenture
at any time by the Company, the Guarantor and the Trustee with the consent of the Holders of a majority in principal

    	 	9	 

    	 

    

amount
of the Securities at the time Outstanding of all series to be affected, acting together as a class. The Indenture also contains
provisions permitting the Holders of a majority in principal amount of the Securities of all series at the time Outstanding affected
by certain provisions of the Indenture, acting together as a class, on behalf of the Holders of all Securities of such series,
to waive compliance by the Company or the Guarantor with those provisions of the Indenture. Certain past defaults under the Indenture
and their consequences may be waived under the Indenture by the Holders of a majority in principal amount of the Securities of
each series at the time Outstanding, on behalf of the Holders of all Securities of such series. Solely for the purpose of determining
whether any consent, waiver, notice or other action or Act to be taken or given by the Holders of Securities pursuant to the Indenture
has been given or taken by the Holders of Outstanding Securities in the requisite aggregate principal amount, the principal amount
of this Security will be deemed to be equal to the amount set forth on the face hereof as the “Face Amount” hereof.
Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this Security.

Defeasance

Section 403
and Article Fifteen of the Indenture and the provisions of clause (ii) of Section 401(1)(B) of the Indenture, relating
to defeasance at any time of (a) the entire indebtedness on this Security and (b) certain restrictive covenants, upon
compliance by the Company or the Guarantor with certain conditions set forth therein, shall not apply to this Security. The remaining
provisions of Section 401 of the Indenture shall apply to this Security.

Authorized
Denominations

This
Security is issuable only in registered form without coupons in denominations of $1,000 or any amount in excess thereof which
is an integral multiple of $1,000.

Registration
of Transfer

Upon
due presentment for registration of transfer of this Security at the office or agency of the Company in the City of Minneapolis,
Minnesota, a new Security or Securities of this series, with the same terms as this Security, in authorized denominations for
an equal aggregate Face Amount will be issued to the transferee in exchange herefor, as provided in the Indenture and subject
to the limitations provided therein and to the limitations described below, without charge except for any tax or other governmental
charge imposed in connection therewith.

This
Security is exchangeable for definitive Securities in registered form only if (x) the Depositary notifies the Company that
it is unwilling or unable to continue as Depositary for this Security or if at any time the Depositary ceases to be a clearing
agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not appointed within 90 days
after the Company receives such notice or becomes aware of such ineligibility, (y) the Company in its sole discretion determines
that this Security shall be exchangeable for definitive Securities in registered form and notifies the Trustee thereof or (z)
an Event of Default with respect to the Securities represented hereby has occurred and is continuing. If this Security is exchangeable

    	 	10	 

    	 

    

pursuant
to the preceding sentence, it shall be exchangeable for definitive Securities in registered form, having the same date of issuance,
Stated Maturity Date and other terms and of authorized denominations aggregating a like amount.

This
Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor of the Depositary
or a nominee of such successor. Except as provided above, owners of beneficial interests in this Global Security will not be entitled
to receive physical delivery of Securities in definitive form and will not be considered the Holders hereof for any purpose under
the Indenture.

Prior
to due presentment of this Security for registration of transfer, the Company, the Guarantor, the Trustee and any agent of the
Company, the Guarantor or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the Guarantor, the Trustee nor any such agent shall
be affected by notice to the contrary.

Obligation
of the Company Absolute

No
reference herein to the Indenture and no provision of this Security or the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the Cash Settlement Amount at the times, place and rate, and in the coin
or currency, herein prescribed, except as otherwise provided in this Security.

No
Personal Recourse

No
recourse shall be had for the payment of the Cash Settlement Amount, or for any claim based hereon, or otherwise in respect hereof,
or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer
or director, as such, past, present or future, of the Company or any successor corporation or of the Guarantor or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty
or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issuance hereof, expressly
waived and released.

Defined
Terms

All
terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture unless
otherwise defined in this Security.

Governing
Law

This
Security shall be governed by and construed in accordance with the law of the State of New York, without regard to principles
of conflicts of laws.

    	 	11	 

    	 

    

ABBREVIATIONS

 

The
following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written
out in full according to applicable laws or regulations:

 

	TEN COM	--	as tenants in common
	 	 	 
	TEN ENT	--	as tenants by the entireties
	 	 	 
	JT TEN	--	as joint tenants with right
	 	 	of survivorship and not
	 	 	as tenants in common

 

	UNIF GIFT MIN ACT

	--

	 

	 

	Custodian 

	 

	 

	 

	(Cust)

	 

	 

	(Minor)

 

Under
Uniform Gifts to Minors Act

	 	 
	(State)	 

  

Additional
abbreviations may also be used though not in the above list.

 

FOR
VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto

 

Please
Insert Social Security or 

Other
Identifying Number of Assignee

 

	 	 
	 	 
	 	 

(Please
print or type name and address including postal zip code of Assignee)

 

    	 	12	 

    	 

    

the
within Security of WELLS FARGO FINANCE LLC and does hereby irrevocably constitute and appoint __________________ attorney to transfer
the said Security on the books of the Company, with full power of substitution in the premises.

 

 

Dated:
_________________________

  

 

	 	 
	 	 
	 	 
	 	 

 

 

 

 

NOTICE:
The signature to this assignment must correspond with the name as written upon the face of the within instrument in every particular,
without alteration or enlargement or any change whatever.

 

 

    	 	13FIRST COMMUNITY CORPORATION 

ANNUAL INCENTIVE PLAN

SECTION 1: Establishment
& Purpose.

1.1        Establishment
of Plan. The Company hereby establishes this First Community Corporation Annual Incentive Plan for its corporate and Subsidiary
employees.

1.2
       Purpose of Plan. The purpose of this Plan is to advance the interests of the Company
and its Subsidiaries by attracting and retaining employees and by stimulating the efforts of such employees to contribute to the
continued success and growth of the business of the Company and its Subsidiaries. This Plan is further intended to provide flexibility
to the Company and its Subsidiaries in structuring incentive compensation to appropriately balance risk and reward, ensure compatibility
with effective controls and risk-management, and to align Awards with the interests of its shareholders. 

SECTION
2: Definitions.

The
following words have the following meanings unless a different meaning plainly is required by the context:

2.1
       “Act” means the Securities Exchange Act of 1934, as amended.

2.2
       “Award” means a right granted to a Participant to receive
an incentive payment, in cash or other property, upon the achievement of certain Performance Measures designated as provided in
this Plan.

2.3       “Award
Agreement” means any written or electronic agreement entered into between the Company and a Participant setting forth
the terms and conditions of an Award made to such Participant under this Plan, such Award Agreement to be in such form as shall
be prescribed by the Committee from time to time.

2.4
       “Base Salary” means, unless otherwise specified by the
Committee with respect to an Award, a Participant’s annualized base salary as of the last day of the applicable Performance
Period or, if later, the date that the Participant is hired by the Company or a Subsidiary or promoted to a position in which he
or she is eligible to be a Participant.

2.5
       “Board” means the Board of Directors of the Company.

2.6       “Code”
means the Internal Revenue Code of 1986, as amended. Each reference in this Plan to a section or sections of the Code, unless otherwise
noted, shall be deemed to include a reference to the rules and regulations issue under such section or sections of the Code.

2.7
       “Committee” means the Human Resources and Compensation
Committee of the Board or such other committee as the Board may designate from time to time. The Committee shall consist of at
least three members of the Board and all of its members shall be independent under applicable Nasdaq Stock Market rules.

2.8       “Company”
means First Community Corporation, a South Carolina corporation, and its successors and assigns.

2.9        “Disability”
means an inability of a Participant to perform his or her employment duties as defined in 409a(3)(i)(4).

2.10       “Employee”
means an employee of the Company or one of its Subsidiaries.

2.11
       “Maximum Award” means a dollar amount or a percentage
of Base Salary, as determined by the Committee for each Performance Period, which represents the payment that the Participant
will earn if the maximum level of the Performance Measures is achieved, subject to Section 4(a).

    	 	 1	 

     

    

2.12
       “Participants” means any Employee who is designated by the Committee
as a Participant in this Plan. Members of the Board who are not also Employees are not eligible to participate in this Plan. A
person who is hired by the Company or any of its Subsidiaries, or promoted to a position in which he or she is eligible to be a
Participant, during a Performance Period may also be designated by the Committee at the time of hire or promotion as a Participant,
in which event the Performance Period for such Participant shall be the portion of the Performance Period remaining after the person
is designated a Participant. 

2.13
       “Performance Measures” means the performance goals selected
for each Participant with respect to each Performance Period, the achievement of which shall determine the amount of the Participant’s
Award for the Performance Period. The Performance Measures may include any of the criteria listed below:

 

		a)	Asset quality;

		b)	Cash flow (before or after dividends);

		c)	Cash flow per share (before or after dividends);

		d)	Cash flow return on investment;

		e)	Cash generation;

		f)	Combined ratio;

		g)	Core non-interest income or change in working
capital; 

		h)	Cost control;

		i)	Cost saving levels;

		j)	Deposit portfolio growth;

		k)	Dividends; 

		l)	Earnings (including earnings before taxes,
earnings before interest and taxes or earnings before interest, taxes, depreciation and amortization);

		m)	Economic value added;

		n)	Efficiency ratio;

		o)	Embedded value added;

		p)	Gross margin;

		q)	Gross profit;

		r)	Level of classified assets;

		s)	Liquidity;

		t)	Loan portfolio growth;

		u)	Market share;

		v)	Market-spending efficiency;

		w)	Net income or net core income;

		x)	Net interest margin;

		y)	Net interest income

		z)	Non-performing assets as a percentage of
assets;

		aa)	Objective customer service measures or indices;

		bb)	Operating or reported earnings per share;

		cc)	Operating or reporting return on assets;

		dd)	Operating profit;

		ee)	Pre- or after-tax income;

		ff)	Prescribed rating;

		gg)	Pure deposits; 

		hh)	Return on average assets;

		ii)	Return on capital (including return on total
capital or return on invested capital);

		jj)	Return on equity or return on average equity;

		kk)	Revenue growth;

		ll)	Revenues;

		mm)	Risk-based capital;

		nn)	Safety and soundness rating;

		oo)	Sales;

		pp)	Shareholder value added;

		qq)	Stock price;

		rr)	Total shareholder return or stock price return;

		ss)	Unit volume; and

		tt)	Such other business criteria as the Committee
may determine to be appropriate, which may include financial and nonfinancial performance goals.

    	 	 2	 

     

    

One
or more Performance Measures may, in the Committee’s sole discretion and provided that the Committee determines that it does
not encourage the applicable Participant to expose the Company or its Subsidiaries to imprudent risks that may pose a threat to
the safety and soundness of the Company or its Subsidiaries: (i) be linked to the Participant’s business unit, division,
business segment, a Subsidiary or the Company as a whole, or any combination of the foregoing, or to such Participant’s areas
of responsibility; (ii) be compared to pre-determined levels, as the Committee may deem appropriate, or compared to the performance
of a pre-established peer group, or published or special index that the Committee, in its sole discretion, deems appropriate; or
(iii) include subjective determinations by the Committee or the Participant’s superiors. The conditions for grant or vesting
and the other provisions of Awards (including, without limitation, any applicable Performance Measures) need not be the same with
respect to each Participant.

The
Committee may adjust any Performance Measure to the extent necessary to prevent dilution or enlargement of an Award as a result
of extraordinary events or circumstances, as determined by the Committee in its sole discretion, or to exclude the effects of extraordinary,
unusual, or non-recurring items, such as (a) asset write-downs, (b) litigation or claim judgments or settlements, (c) changes in
tax laws, accounting principles, or other laws or provisions affecting reported results, (d) any reorganization and restructuring
programs, (e) extraordinary nonrecurring items as described in Financial Accounting Standards Board Accounting Standards Codification
Topic 225-20 and/or in management’s discussion and analysis of financial condition and results of operations appearing in
the Company’s annual report to shareholders for the applicable fiscal year, (f) acquisitions, mergers, or divestitures (including
non-recurring transaction-related expenses); (g) securities offerings; (h) accounting changes, (i) amortization of goodwill or
other intangible assets, (j) discontinued operations, (k) life insurance benefits and (l) other special charges or extraordinary
items as approved by the Committee, in its sole discretion. 

2.14
       “Performance Period” means each consecutive twelve (12)-month
period commencing on the first day of each calendar or fiscal year during the term of this Plan, or a portion of such twelve (12)-month
period with respect to an Employee who becomes a Participant during such period, or such other period as determined by the Committee.

2.15
       “Plan” means this First Community Corporation Annual Incentive
Plan.

2.16
       “Subsidiary” means any corporation, partnership, joint venture,
limited liability company or other entity during any period in which at least a fifty percent (50%) voting or profits interest
is owned, directly or indirectly, by the Company or any successor to the Company.

2.17
       “Target Award” means a dollar amount or a percentage of Base Salary
determined by the Committee for each Performance Period, which represents the payment that the Participant will earn if the target
level of the Performance Measures is achieved, subject to Section 4(a).

2.18
       “Threshold Award” means a dollar amount or a percentage of Base
Salary, as determined by the Committee for each Performance Period, which represents the payment that the Participant will earn
if the threshold level of the Performance Measures is achieved, subject to Section 4(a).

SECTION 3: Administration.

3.1       Power
and Authority of Committee. The Plan shall be administered by the Committee. The Committee shall have full power and authority,
subject to all applicable provisions of this Plan and applicable law, to 

		(a)	establish, amend, suspend or waive such rules and regulations
and appoint such agents as it deems necessary or advisable for the proper administration of this Plan, 

		(b)	construe, interpret and administer this Plan and any instrument
or agreement relating to this Plan, including correcting any defect, supplying any omission, interpreting any ambiguity or reconciling
any inconsistency in the manner and to the extent it shall deem desirable to carry this Plan into effect,

		(c)	waive, prospectively or retroactively, any conditions of or
rights of the Company under any Award, 

		(d)	increase or decrease the payout due under any Award, and

 

    	 	 3	 

     

    
		(e)	make all other determinations and take all other actions necessary
or advisable for the administration of this Plan. 

Unless
otherwise expressly provided in this Plan, each determination made and each action taken by the Committee pursuant to this Plan
or any instrument or agreement relating to this Plan shall be within the sole discretion of the Committee, may be made at any time
and shall be final, binding and conclusive for all purposes on all persons, including, but not limited to, Participants of the
Company or its Subsidiaries, and their legal representatives and beneficiaries. The Committee may take actions or otherwise make
determinations that are subject to ratification by the Board. Subject to the applicable rules of the Nasdaq Stock Market, if the
Committee does not exist, or for any other reason determined by the Board in its sole discretion, the Board may make any determination
or take any other action under the Plan that would otherwise be the responsibility of the Committee (and, to the extent the Board
makes any determination or take any other action under the Plan, the Board shall be deemed to be the Committee for purposes of
the Plan with respect to such determination or other action by the Board). An Award Agreement shall not be required for Awards.
However, an Award Agreement may be utilized in connection with any Awards if and to the extent deemed appropriate by the Committee.
Any Award Agreement or Award Document shall be deemed to be part of (and subject to the terms and conditions of) the Plan and,
accordingly, shall be administered by the Committee as set forth in this Section 3. An Award must be evidenced by an Award Agreement
or other written instrument (and “Award Document”) approved by the Committee. 

3.2
       Delegation. The Committee may delegate its powers and duties under this Plan, to
designate Employees who will be eligible for Awards and the Performance Measures and other terms of such Awards, and/or to approve
achievement of the applicable Performance Measures, to a sub-committee of the Committee.

3.3
       Determinations at the Outset of Each Performance Period. Prior to the start of or
during each Performance Period, the Committee shall:

		(a)	designate Employees who will become Participants for such
Performance Period;

		(b)	establish a Threshold Award, Target Award and Maximum Award
for each Participant; and

		(c)	with respect to each Participant, establish one or more Performance
Measures and a formula to determine the amount of the Award that will be earned at different levels of achievement of the Performance
Measures. 

3.4
       Approval. Following the close of each Performance Period and prior to payment of
any amount to any Participant under this Plan, the Committee must determine which of the applicable Performance Measures for that
Performance Period have been achieved and the attainment of all other factors upon which any payments to a Participant for that
Performance Period are to be based and the corresponding Award amounts. Such approval shall be made in time to permit payments
to be made not later than the fifteenth (15th) day of the third (3rd) calendar month following the end of the Performance Period.

SECTION
4: Incentive Payment.

Subject
to the provisions of this Plan, each Participant shall receive an incentive payment for each Performance Period in the amount determined
by the extent to which his or her Performance Measures have been achieved under the terms of his or her Award, subject to the limitations
set forth below:

(a)
       Discretionary Increase or Reduction. The Committee shall retain sole and absolute
discretion to increase or reduce the amount of any incentive payment otherwise payable to any Participant under this Plan. 

(b)
       Continued Employment. Except as otherwise approved by the Committee or specifically
set forth in a written employment agreement between the Employee and the Company or its Subsidiaries in effect on the date of such
payment, no incentive payment under this Plan with respect to a Performance Period shall be paid or owed to a Participant who is
not employed in good standing, as determined by the Committee, on the date payment is made for a Performance Period under Section
5.1; provided that the Committee may, in its sole discretion, approve pro-rated payments in the event of retirement, death, disability,
layoff, etc.

(c)       Regulatory
Action. Awards will not be earned or paid, regardless of achievement of Performance Measures, (i) to the extent that any regulatory
agency issues a formal, written enforcement action, memorandum of understanding or other directive action that, or a regulation
that, prohibits or limits the eligibility of the Employee for or pay out of the Award to the Employee under the Plan, or (ii) if,
after a review of the Company’s or its Subsidiaries’ credit quality measures, the Committee considers it imprudent
to provide or pay out the Award under the Plan. 

    	 	 4	 

     

    

(d)       Ethical
Obligations.  The Company and its Subsidiaries are committed to doing business in an honest and ethical manner and to complying
with all applicable laws and regulations. Participant actions are expected to comply with the policies established by the Company
and its Subsidiaries, including their Codes of Ethics and Insider Trading Policies. The Committee may determine, on a case-by-case
basis, any reductions or eliminations of incentive payments under this Plan due to violations of policies or noncompliance.

(e)       Clawback.
By accepting any compensation paid or otherwise made available to a Participant under this Plan, the Participant agrees to the
terms and conditions of this Plan (including, without limitation, this Section 4(e)). The Participant agrees to repay any compensation
previously or hereafter paid by the Company or its Subsidiaries, or otherwise made available to the Participant under this Plan,
that is subject to recovery under any applicable law or regulation (including any rule of any exchange or service through which
the securities of the Company are then traded), or any compensation “clawback” or recoupment policy of the Company
or its Subsidiaries applicable to similarly-situated Employees of the Company or such Subsidiary or required to comply with applicable
law or regulation (as may be amended from time to time and as may hereafter be adopted). Any Participant whose Award payout becomes
subject to forfeiture or clawback shall promptly return any payment received under this Plan that is identified by the Company
by written notice to the Participant. If the Participant fails to return such payment promptly, the Company or its Subsidiaries
may, among other things, deduct such amount from other compensation owed to the Participant by the Company or its Subsidiaries
as an advancement of wages, and the Participant’s acceptance of the applicable Award represents his or her acknowledgment
and agreement to such deduction. The Participant acknowledges the rights of the Company and its Subsidiaries to engage in any legal
or equitable action or proceeding in order to enforce the provisions of this Section. 

SECTION
5: Benefit Payments.

5.1
       Time and Form of Payments. All payments of Awards pursuant to this Plan unless otherwise
specified by the Committee shall be paid in a cash lump sum payment or equity award and shall be made not later than the fifteenth
(15th) day of the third (3rd) month following the end of the Performance Period; provided that the Committee may permit Participants
to elect to defer payment of their Awards pursuant to a timely election made pursuant to any deferred compensation plan that has
been or may be established by the Company that satisfies the requirements of Section 409A of the Code. 

5.2
       Nontransferability. Except as otherwise determined by the Committee, no right to
any incentive payment under this Plan, whether payable in cash or property, shall be transferable by a Participant other than by
will or by the laws of descent and distribution; provided, however, that if so determined by the Committee, a Participant may,
in the manner established by the Committee, designate a beneficiary or beneficiaries to exercise the rights of the Participant
and receive any cash or property due under the Participant’s Award upon the death of the Participant. No right to any incentive
payment under this Plan may be pledged, attached or otherwise encumbered, and any purported pledge, attachment or encumbrance thereof
shall be void and unenforceable against the Company.

5.3       Other
Restrictions. The Committee may impose other restrictions on any Award, or any cash or property acquired in connection with
an Award, as the Committee deems advisable, including, without limitation, holding periods or further transfer restrictions, forfeiture
provisions, and restrictions under applicable federal or state laws. 

5.4
       Tax Withholding. The Company or its Subsidiaries shall be entitled to withhold and
deduct from payment of the Award, future wages of a Participant (or from other amounts that may be due and owing to a Participant
from the Company or a Subsidiary), or make other arrangements for the collection of, all legally required amounts necessary to
satisfy any and all federal, state, local and foreign withholding and employment-related tax requirements attributable to an Award.
The Company may also require a Participant promptly to remit the amount of such withholding to the Company or its Subsidiaries
before taking any action with respect to an Award. The Company may establish such rules and procedures concerning timing of any
withholding election as it deems appropriate. Notwithstanding any action taken or not taken by the Company or its Subsidiaries,
the Participant shall remain solely liable for all taxes due with respect to his or her Award.

    	 	 5	 

     

    

SECTION
6: Amendment and Termination.

Except
to the extent prohibited by applicable law and unless otherwise expressly provided in this Plan, the Board may amend, alter, suspend,
discontinue or terminate this Plan, and the Committee may amend or cancel any Award, except that no such amendment, alteration,
suspension, discontinuation or termination shall be made that would violate the rules or regulations of the NASDAQ Stock Market
or any other laws, rules and regulations that are applicable to the Company. 

This
Plan will continue in effect until terminated by the Board (although any Awards outstanding at such time shall remain outstanding
and subject to this Plan until they are paid out or otherwise cancelled as provided in this Plan). The Committee is not required
to grant any Awards under this Plan. 

SECTION
7: General Provisions.

7.1        Effective
Date. This Plan was approved by the Board to be effective as of January 1, 2020.

7.2        Term
of this Plan. This Plan shall continue indefinitely until otherwise terminated pursuant to Section 6. No right to receive an
incentive payment shall be granted after the termination of this Plan. However, unless otherwise expressly provided in this Plan,
any right to receive an incentive payment theretofore granted may extend beyond the termination of this Plan, and the authority
of the Board and the Committee and its delegates to amend or otherwise administer this Plan shall extend beyond the termination
of this Plan.

7.3        Headings.
Headings are given to the Sections and subsections of this Plan solely as a convenience to facilitate reference. Such headings
shall not be deemed in any way material or relevant to the construction or interpretation of this Plan or any provision thereof.

7.4        Applicability
to Successors. This Plan shall be binding upon and inure to the benefit of the Company and each Participant, and the successors
and assigns of the Company, and the beneficiaries, personal representatives and heirs of each Participant. If the Company becomes
a party to any merger, consolidation or reorganization, this Plan shall remain in full force and effect as an obligation of the
Company or its successors in interest.

7.5        Employment
Rights and Other Benefit Programs. The provisions of this Plan shall not give any Participant any right to be retained in the
employment of the Company or its Subsidiaries. In the absence of any specific agreement to the contrary, this Plan shall not affect
any right of the Company, or of any Subsidiary, to terminate, with or without cause, any Participant’s employment or service
at any time. This Plan shall not replace any contract of employment, whether oral or written, between the Company or its Subsidiaries
and any Participant, but shall be considered a supplement thereto. This Plan is in addition to, and not in lieu of, any other employee
benefit plan or program in which any Participant may be or become eligible to participate by reason of employment with the Company
or its Subsidiaries. No compensation or benefit awarded to or realized by any Participant under this Plan shall be included for
the purpose of computing such Participant’s compensation under any compensation-based retirement, disability, or similar
plan of the Company or any Subsidiary unless required by law or otherwise provided by such other plan.

7.6       No
Trust or Fund Created. This Plan shall not create or be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company or any Subsidiary and a Participant or any other person. To the extent that any person acquires
a right to receive payments from the Company or any Subsidiary pursuant to this Plan, such right shall be no greater than the right
of any unsecured general creditor of the Company or of any Subsidiary.

7.7       Governing
Law. The validity, construction and effect of this Plan or any incentive payment payable under this Plan shall be determined
in accordance with the laws of the State of South Carolina.

7.8       Severability.
If any provision of this Plan is, becomes, or is deemed to be invalid, illegal or unenforceable in any jurisdiction, such provision
shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended without,
in the determination of the Committee, materially altering the purpose or intent of this Plan, such provision shall be stricken
as to such jurisdiction, and the remainder of this Plan shall remain in full force and effect.

    	 	 6	 

     

    

7.9       Certain
Tax Matters. No payments are intended to constitute deferred compensation subject to Section 409A of the Code, unless a Participant
elects to defer a payment pursuant to a deferred compensation plan that is intended to comply with such Code Section. The Plan
is, and all Awards are, intended to be exempt from (or, in the alternative, to comply with) Section 409A of the Code, and each
shall be construed, interpreted and administered accordingly. The Company and its Subsidiaries do not guarantee that any benefits
that may be provided under the Plan will satisfy all applicable provisions of Section 409A of the Code. Each payment under any
Award shall be treated as a separate payment for purposes of Section 409A of the Code. In no event may a Participant, directly
or indirectly, designate the calendar year of any payment to be made under any Award. Notwithstanding any provision of this Plan
or any Award Agreement or Award Document to the contrary, in the event that a Participant is a “specified employee”
within the meaning of Section 409A of the Code (as determined in accordance with the methodology established by the Company), amounts
that constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code that would otherwise
be payable during the six-month period immediately following a Participant’s “separation from service” within
the meaning of Section 409A of the Code shall instead be paid or provided on the first business day following the date that is
six months following the Participant’s separation from service or any earlier date permitted by Section 409A of the Code.
If the Participant dies following the separation from service and prior to the payment of any amounts delayed on account of Section
409A of the Code, such amounts shall be paid to the personal representative of the Participant’s estate within 30 days following
the date of the Participant’s death.

If any Award
would be considered “deferred compensation” under Section 409A of the Code, the Committee reserves the absolute right
(including the right to delegate such right) to unilaterally amend the Plan or the applicable Award Agreement or Award Document,
without the consent of the Participant, to avoid the application of, or to maintain compliance with, Section 409A of the Code.
Any amendment by the Committee to the Plan or an Award Agreement pursuant to this Section 7.9 shall seek to maintain, to the extent
practicable, the original intent of the applicable provision without violating Section 409A of the Code. A Participant’s
acceptance of any Award shall be deemed to constitute the Participant’s acknowledgment of, and consent to, the rights of
the Committee under this Section 7.9, without further consideration or action. Any discretionary authority retained by the Committee
pursuant to the terms of the Plan or pursuant to an Award Agreement or Award Document shall not be applicable to an Award that
is determined to constitute deferred compensation, if such discretionary authority would contravene Section 409A of the Code. In
no event will the Company or any Subsidiary of the Company be required to reimburse a Participant for any taxes imposed or other
costs incurred as a result of Section 409A of the Code.

This Plan is
being executed, on behalf of the Board, by the undersigned duly-authorized officer of the Company.

 

    	 	 7

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