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. 95001B5Y6
	FACE AMOUNT: $_________

	
REGISTERED
NO. ___

 

 

WELLS
FARGO & COMPANY

 

MEDIUM-TERM
NOTE, SERIES S

 

Due
Nine Months or More From Date of Issue

 

Principal
at Risk Securities Linked to the Lowest Performing of the

Common Stock of Philip Morris International Inc. and the Common Stock of Altria Group, Inc. due August 19, 2021

 

WELLS
FARGO & COMPANY, a corporation duly organized and existing under the laws of the State of Delaware (hereinafter called the
“Company,” which term includes any successor corporation under the Indenture hereinafter referred to), for
value received, hereby promises to pay to CEDE & Co., or registered assigns, an amount equal to the Maturity Payment
Amount (as defined below) on the Stated Maturity Date (as defined below), unless this Security is automatically called prior to
the Stated Maturity Date as provided below under “Automatic Call,” and to pay Contingent Coupon Payments (as defined
below) on the Face Amount of this Security to the extent provided herein on the Contingent Coupon Payment Dates specified herein
at the Contingent Coupon Rate (as defined below) until the earlier of the Stated Maturity Date and the Call Settlement Date (as
defined below), if any. The “Initial Stated Maturity Date” shall be August 19, 2021. If the Final Calculation
Day (as defined below) is not postponed, the Initial Stated Maturity Date will be the “Stated Maturity Date.”
If the Final Calculation Day is postponed, the “Stated Maturity Date” shall be the later of (i) the Initial
Stated Maturity Date and (ii) three Business Days (as defined below) after the last Final Calculation Day as postponed.

“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.”

Automatic
Call

If
the Stock Closing Price (as defined below) of the Lowest Performing Underlying Stock (as defined below) on any of the quarterly
Calculation Days (as defined below) from February 2019 to May 2021, inclusive, is greater than or equal to its Starting Price
(as defined below), this Security will be automatically called by the Company, and on the related Call Settlement Date the Holder
hereof will receive the Call Price (as defined below) plus a final Contingent Coupon Payment. Unless the Company defaults in the
payment of the Call Price plus the final Contingent Coupon Payment, this Security will cease to be outstanding on such Call Settlement
Date, no additional Contingent Coupon Payments will be payable on this Security and the Holder hereof will have no further rights
under this Security after such Call Settlement Date. The Holder hereof will not receive any notice from the Company in the event
this Security is automatically called pursuant to the terms hereof. The “Call Price” is equal to the Face Amount
of this Security. The “Call Settlement Date” for a Calculation Day shall be three Business Days after such
Calculation Day, as such Calculation Day may be postponed as provided herein. If a Calculation Day is postponed with respect to
one or both Underlying Stocks, the related Call Settlement Date will be three Business Days after the last Calculation Day as
postponed.

 

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Payment
of Contingent Coupon Payments, the Maturity Payment Amount and the Call Price

On
each quarterly Contingent Coupon Payment Date, the Company shall pay a Contingent Coupon Payment if, and only if, the Stock Closing
Price of the Lowest Performing Underlying Stock on the related Calculation Day is greater than or equal to its Threshold Price
(as defined below). A “Contingent Coupon Payment,” if payable as provided herein, shall be equal to the product
of (i) the Face Amount of this Security, (ii) the Contingent Coupon Rate, and (iii) 90/360. The “Contingent
Coupon Payment Dates” shall be the third Business Day following each Calculation Day, as each such Calculation Day may
be postponed as herein provided, provided that the Contingent Coupon Payment Date with respect to the Final Calculation Day will
be the Stated Maturity Date. If a Calculation Day is postponed with respect to one or both Underlying Stocks, the related Contingent
Coupon Payment Date will be three Business Days after the last Calculation Day as postponed. The “Contingent Coupon Rate”
is 8.75% per annum. Any Contingent Coupon Payments will be rounded to the nearest cent, with one-half cent rounded upward.

Any
Contingent Coupon Payment so payable, and punctually paid or duly provided for, on any Contingent Coupon Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered
at the close of business on the Regular Record Date for such Contingent Coupon Payment next preceding such Contingent Coupon Payment
Date. The Regular Record Date for a Contingent Coupon Payment Date shall be the date one Business Day prior to such Contingent
Coupon Payment Date. 

Any
Contingent Coupon Payment not punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered
at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities of this series not less than 10 days prior to such Special Record Date, or
be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the
Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided
in the Indenture.

Payment
of any Contingent Coupon Payment on this Security will be made in immediately available funds at the office or agency of the Company
maintained for that purpose in the City of Minneapolis, Minnesota; provided, however, that, at the option of the Company, payment
of any Contingent Coupon Payment may be paid by check mailed to the Person entitled thereto at such Person’s last address
as it appears in the Security Register or by wire transfer to such account as may have been designated by such Person. Payments
of any Contingent Coupon Payment and the Maturity Payment Amount or the Call Price, as applicable, 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. Notwithstanding the foregoing,
for so long as this Security is a Global Security registered in the name of the Depositary, any payments on this Security will
be made to the Depositary by wire transfer of immediately available funds. 

 

    	2 

    	 

    

 

Payment
of the Maturity Payment Amount or the Call Price, as applicable, and any Contingent Coupon Payments on this Security will be made
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.

Definitions
Relating to Maturity Payment Amount, the Call Price and Contingent Coupon Payments

If
this Security is not automatically called prior to the Stated Maturity Date as provided above under “Automatic Call,”
the “Maturity Payment Amount” of this Security will equal:

		•	if
                                         the Ending Price of the Lowest Performing Underlying Stock on the Final Calculation Day
                                         is greater than or equal to its Threshold Price: the Face Amount; or

 

		•	if
                                         the Ending Price of the Lowest Performing Underlying Stock on the Final Calculation Day
                                         is less than its Threshold Price:

 

	 		Face Amount  x	 	Performance
        Factor of the Lowest Performing

        Underlying
        Stock on the Final Calculation 

Day
		  

 

All
calculations with respect to the Maturity Payment 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 Maturity Payment Amount will be rounded to the nearest cent,
with one-half cent rounded upward.

“Underlying
Stock” shall mean each of the common stock of Philip Morris International Inc. and the common stock of Altria Group,
Inc.

The
“Pricing Date” shall mean August 15, 2018.

The
“Lowest Performing Underlying Stock” for any Calculation Day will be the Underlying Stock with the lowest Performance
Factor on that Calculation Day (as such Calculation Day may be postponed for one or both Underlying Stocks).

 

    	3 

    	 

    

 

The
“Performance Factor” with respect to an Underlying Stock on any Calculation Day is its Stock Closing Price
on such Calculation Day divided by its Starting Price (expressed as a percentage).

The
“Starting Price” with respect to the common stock of Philip Morris International Inc. is $83.41, its Stock
Closing Price on the Pricing Date; and with respect to the common stock of Altria Group, Inc. is $60.18, its Stock Closing Price
on the Pricing Date.

The
“Ending Price” of an Underlying Stock will be its Stock Closing Price on the Final Calculation Day.

The
“Threshold Price” with respect to the common stock of Philip Morris International Inc. is $50.046, which is
equal to 60% of its Starting Price; and with respect to the common stock of Altria Group, Inc. is $36.108, which is equal to 60%
of its Starting Price.

The
“Stock Closing Price” with respect to each Underlying Stock on a Calculation Day, means the product of the
Closing Price of such Underlying Stock and the Adjustment Factor for such Underlying Stock, each on such Calculation Day.

The
“Adjustment Factor” for each Underlying Stock is initially 1.0. The Adjustment Factor for each Underlying Stock
will remain constant for the term of this Security, subject to adjustment for certain corporate events relating to the applicable
Underlying Stock Issuer as set forth below under “—Adjustment Events.”

“Underlying
Stock Issuer” shall mean the issuer of each Underlying Stock.

“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.

The
“Calculation Days” shall be the 16th day of each February, May, August and November, commencing
November 2018 and ending May 2021, and the Final Calculation Day. If any such day is not a Trading Day with respect to either
Underlying Stock, that Calculation Day for each Underlying Stock will be postponed to the next succeeding day that is a Trading
Day with respect to each Underlying Stock. A Calculation Day for an Underlying Stock is also subject to postponement due to the
occurrence of a Market Disruption Event (as defined below) with respect to such Underlying Stock on such Calculation Day. The
“Final Calculation Day” is August 16, 2021. If a Market Disruption Event occurs or is continuing with respect
to an Underlying Stock on any Calculation Day, then such Calculation Day for such Underlying Stock will be postponed to the first
succeeding Trading Day for such Underlying Stock on which a Market Disruption Event for such Underlying Stock has not occurred
and is not continuing; however, if such first succeeding Trading Day has not occurred as of the eighth Trading Day for such Underlying
Stock after the originally scheduled Calculation Day, that eighth Trading Day shall be deemed to be the Calculation Day for such
Underlying Stock. If a Calculation Day has been postponed eight Trading Days for an Underlying Stock after the originally scheduled
Calculation Day and a Market Disruption Event occurs or is continuing with respect to such Underlying Stock on such eighth Trading
Day, the Calculation Agent will determine the Closing Price (as defined below) of such Underlying Stock on such eighth Trading
Day by using its good faith estimate of the Closing Price that would have prevailed for such Underlying Stock on such day. Notwithstanding
the postponement of a Calculation Day for an Underlying Stock due to a Market Disruption Event with respect to such Underlying
Stock on such Calculation Day, the originally scheduled Calculation Day will remain the Calculation Day for the other Underlying
Stock if such other Underlying Stock is not affected by a Market Disruption Event on such day.

 

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“Calculation
Agent Agreement” shall mean the Calculation Agent Agreement dated as of January 24, 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 whether this Security will be automatically called prior to stated maturity and whether a Contingent
Coupon Payment will be made, the Call Price, if any, and the Maturity Payment Amount, if any, 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.

Certain
Definitions 

A
“Trading Day” with respect to an Underlying Stock means a day, as determined by the Calculation Agent, on which
trading is generally conducted on the principal trading market for such Underlying Stock (as determined by the Calculation Agent,
in its sole discretion), the Chicago Mercantile Exchange and the Chicago Board Options Exchange and in the over-the-counter market
for equity securities in the United States.

The
“Closing Price” for one share of an Underlying Stock (or one unit of any other security for which a Closing
Price must be determined) on any Trading Day means:

		•	if
                                         such Underlying Stock (or any such other security) is listed or admitted to trading on
                                         a national securities exchange, the official closing price on such day published by the
                                         principal United States securities exchange registered under the Securities Exchange
                                         Act of 1934, as amended (the “Exchange Act”), on which such Underlying
                                         Stock (or any such other security) is listed or admitted to trading; or

 

		•	if
                                         such Underlying Stock (or any such other security) is not listed or admitted to trading
                                         on any national securities exchange but is included in the OTC Bulletin Board Service
                                         (the “OTC Bulletin Board”) operated by the Financial Industry Regulatory
                                         Authority, Inc. (“FINRA”), the last reported sale price of the principal
                                         trading session on the OTC Bulletin Board on such day.

If
such Underlying Stock (or any such other security) is listed or admitted to trading on any national securities exchange but the
official closing price is not available pursuant to the preceding sentence, then the Closing Price for one share of such Underlying
Stock (or one unit of any such other security) on any Trading Day will mean the last reported sale price of the principal trading
session on the over-the-counter market as reported on the OTC Bulletin Board on such day.

 

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If
the official closing price or the last reported sale price, as applicable, for such Underlying Stock (or any such other security)
is not available pursuant to either of the two preceding sentences, then the Closing Price per share for any Trading Day will
be the mean, as determined by the Calculation Agent, of the bid price for such Underlying Stock (or any such other security) obtained
from as many recognized dealers in such security, but not exceeding three, as will make such bid prices available to the Calculation
Agent. Bids of Wells Fargo Securities, LLC or any of its affiliates may be included in the calculation of such mean, but only
to the extent that any such bid is the highest of the bids obtained. The term “OTC Bulletin Board Service”
will include any successor service thereto or, if the OTC Bulletin Board Service is discontinued and there is no successor service
thereto, the OTC Reporting Facility operated by FINRA.

Market
Disruption Events 

 

A
“Market Disruption Event,” with respect to an Underlying Stock, means the occurrence or existence of any of
the following events:

 

		•	a
                                         suspension, absence or material limitation of trading in such Underlying Stock on its
                                         primary market for more than two hours of trading or during the one-half hour before
                                         the close of trading in that market, as determined by the Calculation Agent in its sole
                                         discretion;

 

		•	a
                                         suspension, absence or material limitation of trading in option or futures contracts
                                         relating to such Underlying Stock, if available, in the primary market for those contracts
                                         for more than two hours of trading or during the one-half hour before the close of trading
                                         in that market, as determined by the Calculation Agent in its sole discretion;

 

		•	such
                                         Underlying Stock does not trade on the New York Stock Exchange, the NASDAQ Global Select
                                         Market, the NASDAQ Global Market or what was the primary market for such Underlying Stock,
                                         as determined by the Calculation Agent in its sole discretion; or

 

		•	any
                                         other event, if the Calculation Agent determines in its sole discretion that the event
                                         materially interferes with the Company’s ability or the ability of any of its affiliates
                                         to unwind all or a material portion of a hedge with respect to this Security that the
                                         Company or its affiliates have effected or may effect.

 

The
following events will not be Market Disruption Events:

 

		•	a
                                         limitation on the hours or number of days of trading in such Underlying Stock in its
                                         primary market, but only if the limitation results from an announced change in the regular
                                         business hours of the relevant market; and

 

 

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		•	a
                                         decision to permanently discontinue trading in the option or futures contracts relating
                                         to such Underlying Stock.

 

For
this purpose, a “suspension, absence or material limitation of trading” in the applicable market will not include
any time when that market is itself closed for trading under ordinary circumstances. In contrast, a “suspension, absence
or material limitation of trading” in the applicable market for such Underlying Stock or option or futures contracts relating
to such Underlying Stock, as applicable, by reason of any of:

 

		•	a
                                         price change exceeding limits set by that market;

 

		•	an
                                         imbalance of orders relating to such Underlying Stock or those contracts; or

 

		•	a
                                         disparity in bid and asked quotes relating to such Underlying Stock or those contracts

 

will
constitute a “suspension, absence or material limitation of trading” in such Underlying Stock or those contracts,
as the case may be, in the applicable market.

Adjustment
Events

The
Adjustment Factor for each Underlying Stock is initially 1.0. However, the Adjustment Factor for each Underlying Stock is subject
to adjustment by the Calculation Agent as a result of the dilution and reorganization events described in this section.

How
adjustments will be made

If
one of the events described below occurs with respect to an Underlying Stock and the Calculation Agent determines that the event
has a dilutive or concentrative effect on the market price of such Underlying Stock, the Calculation Agent will calculate a corresponding
adjustment to the Adjustment Factor for such Underlying Stock as the Calculation Agent deems appropriate to account for that dilutive
or concentrative effect. For example, if an adjustment is required because of a two-for-one stock split, then the Adjustment Factor
for such Underlying Stock will be adjusted by the Calculation Agent by multiplying the existing Adjustment Factor by a fraction
whose numerator is the number of shares of such Underlying Stock outstanding immediately after the stock split and whose denominator
is the number of shares of such Underlying Stock outstanding immediately prior to the stock split. Consequently, the Adjustment
Factor for such Underlying Stock will be adjusted to double the prior Adjustment Factor, due to the corresponding decrease in
the market price of such Underlying Stock. Adjustments will be made for events with an effective date or Ex-Dividend Date (as
defined below), as applicable, from but excluding the Pricing Date to and including the applicable Calculation Day (the “Adjustment
Period”).

 

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The
Calculation Agent will also determine the effective date of that adjustment, and the replacement of an Underlying Stock, if applicable,
in the event of a consolidation or merger or certain other events in respect of the applicable Underlying Stock Issuer. Upon making
any such adjustment, the Calculation Agent will give notice as soon as practicable to the Trustee and the Paying Agent, stating
the adjustment to the Adjustment Factor of such Underlying Stock. The Calculation Agent will not be required to make any adjustments
to the Adjustment Factor for purposes of calculating the Stock Closing Price for a Calculation Day after the close of business
on the such Calculation Day; provided that any such adjustments to the Adjustment Factor will be taken into account for
purposes of determining the Stock Closing Price for any subsequent Calculation Day. In no event, however, will an antidilution
adjustment to the Adjustment Factor of an Underlying Stock during the term of this Security be deemed to change the Face Amount
of this Security.

If
more than one event requiring adjustment occurs with respect to an Underlying Stock, the Calculation Agent will make an adjustment
for each event in the order in which the events occur, and on a cumulative basis. Thus, having made an adjustment for the first
event, the Calculation Agent will adjust the Adjustment Factor for such Underlying Stock for the second event, applying the required
adjustment to the Adjustment Factor for such Underlying Stock as already adjusted for the first event, and so on for any subsequent
events.

For
any dilution event described below, other than a consolidation or merger, the Calculation Agent will not have to adjust the Adjustment
Factor for an Underlying Stock unless the adjustment would result in a change to the Adjustment Factor of such Underlying Stock
then in effect of at least 0.10%. The Adjustment Factor of such Underlying Stock resulting from any adjustment will be rounded
up or down, as appropriate, to the nearest one-hundred thousandth.

If
an event requiring an antidilution adjustment occurs with respect to an Underlying Stock, the Calculation Agent will make the
adjustment with a view to offsetting, to the extent practical, any change in the economic position of the Holder of this Security
relative to this Security that results solely from that event. The Calculation Agent may, in its sole discretion, modify the antidilution
adjustments as necessary to ensure an equitable result.

The
Calculation Agent will make all determinations with respect to antidilution adjustments, including any determination as to whether
an event requiring adjustment has occurred with respect to an Underlying Stock, as to the nature of the adjustment required for
such Underlying Stock and how it will be made or as to the value of any property distributed in a Reorganization Event (as defined
below), and will do so in its sole discretion. In the absence of manifest error, those determinations will be conclusive for all
purposes and will be binding on the Holder of this Security and the Company, without any liability on the part of the Calculation
Agent. The Holder of this Security will not be entitled to any compensation from the Company for any loss suffered as a result
of any of these determinations by the Calculation Agent. The Calculation Agent will provide information about the adjustments
that it makes upon the written request of the Holder of this Security.

If
any of the adjustments specified below is required to be made with respect to an amount or value of any cash or other property
that is distributed by an Underlying Stock Issuer organized outside the United States, such amount or value will be converted
to U.S. dollars, as applicable, and will be reduced by any applicable foreign withholding taxes that would apply to such distribution
if such distribution were paid to a U.S. person that is eligible for the benefits of an applicable income tax treaty, if any,
between the United States and the jurisdiction of organization of such Underlying Stock Issuer, as determined by the Calculation
Agent, in its sole discretion.

No
adjustments will be made for certain other events, such as offerings of common stock by an Underlying Stock Issuer for cash or
in connection with the occurrence of a partial tender or exchange offer for an Underlying Stock by the Underlying Stock Issuer
of such Underlying Stock or any other person.

 

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Stock
Splits and Reverse Stock Splits

A
stock split is an increase in the number of a corporation’s outstanding shares of stock without any change in its stockholders’
equity. Each outstanding share will be worth less as a result of a stock split.

A
reverse stock split is a decrease in the number of a corporation’s outstanding shares of stock without any change in its
stockholders’ equity. Each outstanding share will be worth more as a result of a reverse stock split.

If
an Underlying Stock is subject to a stock split or a reverse stock split, then once the split has become effective the Calculation
Agent will adjust the Adjustment Factor for such Underlying Stock to equal the product of the prior Adjustment Factor of such
Underlying Stock and the number of shares issued in such stock split or reverse stock split with respect to one share of such
Underlying Stock.

Stock
Dividends

In
a stock dividend, a corporation issues additional shares of its stock to all holders of its outstanding stock in proportion to
the shares they own. Each outstanding share will be worth less as a result of a stock dividend.

If
an Underlying Stock is subject to a stock dividend payable in shares of such Underlying Stock that is given ratably to all holders
of shares of such Underlying Stock, then once the dividend has become effective the Calculation Agent will adjust the Adjustment
Factor for such Underlying Stock on the Ex-Dividend Date to equal the sum of the prior Adjustment Factor for such Underlying Stock
and the product of:

		•	the
                                         number of shares issued with respect to one share of such Underlying Stock, and

		•	the
                                         prior Adjustment Factor for such Underlying Stock.

 

The
“Ex-Dividend Date” for any dividend or other distribution is the first day on and after which such Underlying
Stock trades without the right to receive that dividend or distribution.

No
Adjustments for Other Dividends and Distributions

The
Adjustment Factor for an Underlying Stock will not be adjusted to reflect dividends, including cash dividends, or other distributions
paid with respect to such Underlying Stock, other than:

		•	stock
                                         dividends described above,

 

    	9 

    	 

    

 

		•	issuances
                                         of transferable rights and warrants as described in “ —Transferable Rights
                                         and Warrants” below,

		•	distributions
                                         that are spin-off events described in “ —Reorganization Events” below,
                                         and

		•	Extraordinary
                                         Dividends described below.

An
“Extraordinary Dividend” means each of (a) the full amount per share of an Underlying Stock of any cash dividend
or special dividend or distribution that is identified by the applicable Underlying Stock Issuer as an extraordinary or special
dividend or distribution, (b) the excess of any cash dividend or other cash distribution (that is not otherwise identified by
the applicable Underlying Stock Issuer as an extraordinary or special dividend or distribution) distributed per share of such
Underlying Stock over the immediately preceding cash dividend or other cash distribution, if any, per share of such Underlying
Stock that did not include an extraordinary or special dividend (as adjusted for any subsequent corporate event requiring an adjustment
as described herein, such as a stock split or reverse stock split) if such excess portion of the dividend or distribution is more
than 5.00% of the Closing Price of such Underlying Stock on the Trading Day preceding the Ex-Dividend Date for the payment of
such cash dividend or other cash distribution (such Closing Price, the “Extraordinary Dividend Base Closing Price”)
and (c) the full cash value of any non-cash dividend or distribution per share of such Underlying Stock (excluding Marketable
Securities, as defined below).

If
an Underlying Stock is subject to an Extraordinary Dividend, then once the Extraordinary Dividend has become effective the Calculation
Agent will adjust the Adjustment Factor for such Underlying Stock on the Ex-Dividend Date to equal the product of:

		•	the
                                         prior Adjustment Factor for such Underlying Stock, and

 

		•	a
                                         fraction, the numerator of which is the Extraordinary Dividend Base Closing Price of
                                         such Underlying Stock on the Trading Day preceding the Ex-Dividend Date and the denominator
                                         of which is the amount by which the Extraordinary Dividend Base Closing Price of such
                                         Underlying Stock on the Trading Day preceding the Ex-Dividend Date exceeds the Extraordinary
                                         Dividend.

Notwithstanding
anything herein, the initiation by an Underlying Stock Issuer of an ordinary dividend on such Underlying Stock or any announced
increase in the ordinary dividend on such Underlying Stock will not constitute an Extraordinary Dividend requiring an adjustment.

To
the extent an Extraordinary Dividend is not paid in cash or is paid in a currency other than U.S. dollars, the value of the non-cash
component or non-U.S. currency will be determined by the Calculation Agent, in its sole discretion. A distribution on an Underlying
Stock that is a dividend payable in shares of such Underlying Stock, an issuance of rights or warrants or a spin-off event and
also an Extraordinary Dividend will result in an adjustment to the number of shares of such Underlying Stock only as described
in “—Stock Dividends” above, “—Transferable Rights and Warrants” below or “—Reorganization
Events” below, as the case may be, and not as described here.

 

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Transferable
Rights and Warrants

If
an Underlying Stock Issuer issues transferable rights or warrants to all holders of such Underlying Stock to subscribe for or
purchase such Underlying Stock at an exercise price per share that is less than the Closing Price of such Underlying Stock on
the Trading Day before the Ex-Dividend Date for the issuance, then the Adjustment Factor for such Underlying Stock will be adjusted
to equal the product of:

		•	the
                                         prior Adjustment Factor for such Underlying Stock, and

 

		•	a
                                         fraction, (1) the numerator of which will be the number of shares of such Underlying
                                         Stock outstanding at the close of trading on the Trading Day before the Ex-Dividend Date
                                         (as adjusted for any subsequent event requiring an adjustment hereunder) plus the number
                                         of additional shares of such Underlying Stock offered for subscription or purchase pursuant
                                         to the rights or warrants and (2) the denominator of which will be the number of shares
                                         of such Underlying Stock outstanding at the close of trading on the Trading Day before
                                         the Ex-Dividend Date (as adjusted for any subsequent event requiring an adjustment hereunder)
                                         plus the number of additional shares of such Underlying Stock (referred to herein as
                                         the “Additional Shares”) that the aggregate offering price of the
                                         total number of shares of such Underlying Stock so offered for subscription or purchase
                                         pursuant to the rights or warrants would purchase at the Closing Price on the Trading
                                         Day before the Ex-Dividend Date for the issuance.

The
number of Additional Shares will be equal to:

 

		•	the
                                         product of (1) the total number of additional shares of such Underlying Stock offered
                                         for subscription or purchase pursuant to the rights or warrants and (2) the exercise
                                         price of the rights or warrants, divided by

 

		•	the
                                         Closing Price of such Underlying Stock on the Trading Day before the Ex-Dividend Date
                                         for the issuance.

If
the number of shares of such Underlying Stock actually delivered in respect of the rights or warrants differs from the number
of shares of such Underlying Stock offered in respect of the rights or warrants, then the Adjustment Factor for such Underlying
Stock will promptly be readjusted to the Adjustment Factor for such Underlying Stock that would have been in effect had the adjustment
been made on the basis of the number of shares of such Underlying Stock actually delivered in respect of the rights or warrants.

Reorganization
Events

Each
of the following is a “Reorganization Event” with respect to an Underlying Stock:

		•	such
                                         Underlying Stock is reclassified or changed (other than in a stock split or reverse stock
                                         split),

 

    	11 

    	 

    

 

 

		•	the
                                         applicable Underlying Stock Issuer has been subject to a merger, consolidation or other
                                         combination and either is not the surviving entity or is the surviving entity but all
                                         outstanding shares of such Underlying Stock are exchanged for or converted into other
                                         property,

 

		•	a
                                         statutory share exchange involving outstanding shares of such Underlying Stock and the
                                         securities of another entity occurs, other than as part of an event described above,

 

		•	the
                                         applicable Underlying Stock Issuer sells or otherwise transfers its property and assets
                                         as an entirety or substantially as an entirety to another entity,

 

		•	the
                                         applicable Underlying Stock Issuer effects a spin-off, other than as part of an event
                                         described above (in a spin-off, a corporation issues to all holders of its common stock
                                         equity securities of another issuer), or

 

		•	the
                                         applicable Underlying Stock Issuer is liquidated, dissolved or wound up or is subject
                                         to a proceeding under any applicable bankruptcy, insolvency or other similar law, or
                                         another entity completes a tender or exchange offer for all the outstanding shares of
                                         such Underlying Stock.

Adjustments
for Reorganization Events

If
a Reorganization Event occurs with respect to an Underlying Stock, then the Calculation Agent will adjust the Adjustment Factor
for such Underlying Stock to reflect the amount and type of property or properties—whether cash, securities, other property
or a combination thereof—that a holder of one share of such Underlying Stock would have been entitled to receive in relation
to the Reorganization Event. This new property is referred to as the “Reorganization Property.”

Reorganization
Property can be classified into two categories:

		•	an
                                         equity security listed on a national securities exchange, which is referred to generally
                                         as a “Marketable Security” and, in connection with a particular Reorganization
                                         Event, “New Stock,” which may include any tracking stock, any stock
                                         received in a spin-off (“Spin-Off Stock”) or any Marketable Security
                                         received in exchange for the applicable Underlying Stock; and

		•	cash
                                         and any other property, assets or securities other than Marketable Securities (including
                                         equity securities that are not listed, that are traded over the counter or that are listed
                                         on a non-U.S. securities exchange), which is referred to as “Non-Stock Reorganization
                                         Property.”

For
the purpose of making an adjustment required by a Reorganization Event, the Calculation Agent, in its sole discretion, will determine
the value of each type of the Reorganization Property. For purposes of valuing any New Stock, the Calculation Agent will use the
Closing Price of the security on the relevant Trading Day. The Calculation Agent will value Non-Stock Reorganization Property
in any manner it determines, in its sole discretion, to be appropriate. In connection with a Reorganization Event in which Reorganization
Property includes New Stock, for the purpose of determining the Adjustment Factor for any New Stock as described below, the term
“New Stock Reorganization Ratio” means the product of (i) the number of shares of the New Stock received
with respect to one share of such Underlying Stock and (ii) the Adjustment Factor for the applicable Underlying Stock on the Trading
Day immediately prior to the effective date of the Reorganization Event.

 

    	12 

    	 

    

 

If
a holder of shares of the applicable Underlying Stock may elect to receive different types or combinations of types of Reorganization
Property in the Reorganization Event, the Reorganization Property will consist of the types and amounts of each type distributed
to a holder of shares of such Underlying Stock that makes no election, as determined by the Calculation Agent in its sole discretion.

If
any Reorganization Event occurs with respect to an Underlying Stock, then on and after the effective date for such Reorganization
Event (or, if applicable, in the case of Spin-Off Stock, the Ex-Dividend Date for the distribution of such Spin-Off Stock) the
term “Underlying Stock” herein will be deemed to mean the following with respect to such Underlying Stock,
and for each share of such Underlying Stock, New Stock and/or Replacement Stock so deemed to constitute such Underlying Stock,
the Adjustment Factor for such Underlying Stock will be equal to the applicable number indicated:

		(a)	if
                                         such Underlying Stock continues to be outstanding:

		(1)	that
                                         Underlying Stock (if applicable, as reclassified upon the issuance of any tracking stock)
                                         at the Adjustment Factor for such Underlying Stock in effect on the Trading Day immediately
                                         prior to the effective date of the Reorganization Event; and

		(2)	if
                                         the Reorganization Property includes New Stock, a number of shares of New Stock equal
                                         to the New Stock Reorganization Ratio;

provided
that, if any Non-Stock Reorganization Property is received in the Reorganization Event, the results of (a)(1) and (a)(2) above
will each be multiplied by the “Gross-Up Multiplier,” which will be equal to a fraction, the numerator of which
is the Closing Price of the original Underlying Stock on the Trading Day immediately prior to the effective date of the Reorganization
Event and the denominator of which is the amount by which such Closing Price of the original Underlying Stock exceeds the value
of the Non-Stock Reorganization Property received per share of such Underlying Stock as determined by the Calculation Agent as
of the close of trading on such Trading Day; or

		(b)	if
                                         such Underlying Stock is surrendered for Reorganization Property:

		(1)	that
                                         includes New Stock, a number of shares of New Stock equal to the New Stock Reorganization
                                         Ratio; provided that, if any Non-Stock Reorganization Property is received in the Reorganization
                                         Event, such number will be multiplied by the Gross-Up Multiplier; or

    	13 

    	 

    

		(2)	that
                                         consists exclusively of Non-Stock Reorganization Property:

		(i)	if
                                         the surviving entity has Marketable Securities outstanding following the Reorganization
                                         Event and either (A) such Marketable Securities were in existence prior to such Reorganization
                                         Event or (B) such Marketable Securities were exchanged for previously outstanding Marketable
                                         Securities of the surviving entity or its predecessor (“Predecessor Stock”)
                                         in connection with such Reorganization Event (in either case of (A) or (B), the “Successor
                                         Stock”), a number of shares of the Successor Stock determined by the Calculation
                                         Agent on the Trading Day immediately prior to the effective date of such Reorganization
                                         Event equal to the Adjustment Factor for such Underlying Stock in effect on the Trading
                                         Day immediately prior to the effective date of such Reorganization Event multiplied by
                                         a fraction, the numerator of which is the value of the Non-Stock Reorganization Property
                                         per share of such Underlying Stock on such Trading Day and the denominator of which is
                                         the Closing Price of the Successor Stock on such Trading Day (or, in the case of Predecessor
                                         Stock, the Closing Price of the Predecessor Stock multiplied by the number of shares
                                         of the Successor Stock received with respect to one share of the Predecessor Stock);
                                         or

		(ii)	if
                                         the surviving entity does not have Marketable Securities outstanding, or if there is
                                         no surviving entity (in each case, a “Replacement Stock Event”), a
                                         number of shares of Replacement Stock (selected as defined below) with an aggregate value
                                         on the effective date of such Reorganization Event equal to the value of the Non-Stock
                                         Reorganization Property multiplied by the Adjustment Factor for such Underlying Stock
                                         in effect on the Trading Day immediately prior to the effective date of such Reorganization
                                         Event.

If
a Reorganization Event occurs with respect to the shares of an Underlying Stock and the Calculation Agent adjusts the Adjustment
Factor of such Underlying Stock to reflect the Reorganization Property in the event as described above, the Calculation Agent
will make further antidilution adjustments for any later events that affect the Reorganization Property, or any component of the
Reorganization Property, comprising the new Adjustment Factor of such Underlying Stock. The Calculation Agent will do so to the
same extent that it would make adjustments if the shares of such Underlying Stock were outstanding and were affected by the same
kinds of events. If a subsequent Reorganization Event affects only a particular component of the number of shares of such Underlying
Stock, the required adjustment will be made with respect to that component as if it alone were the number of shares of such Underlying
Stock.

For
purposes of adjustments for Reorganization Events, in the case of a consummated tender or exchange offer or going-private transaction
involving Reorganization Property of a particular type, Reorganization Property will be deemed to include the amount of cash or
other property paid by the offeror in the tender or exchange offer with respect to such Reorganization Property (in an amount
determined on the basis of the rate of exchange in such tender or exchange offer or going-private transaction). In the event of
a tender or exchange offer or a going-private transaction with respect to Reorganization Property in which an offeree may elect
to receive cash or other property, Reorganization Property will be deemed to include the kind and amount of cash and other property
received by offerees who elect to receive cash.

    	14 

    	 

    

Replacement
Stock Events

Following
the occurrence of a Replacement Stock Event described in paragraph (b)(2)(ii) above or in “—Delisting of American
Depositary Shares or Termination of American Depositary Receipt Facility” below with respect to an Underlying Stock, the
Stock Closing Price of the applicable Underlying Stock on any Calculation Day on or after the effective date of the Replacement
Stock Event will be determined by reference to a Replacement Stock and an Adjustment Factor (subject to any further antidilution
adjustments) for such Replacement Stock as determined in accordance with the following paragraphs.

The
“Replacement Stock” will be the stock having the closest “Option Period Volatility” to the
applicable original Underlying Stock among the stocks that then comprise the Replacement Stock Selection Index (or, if publication
of such index is discontinued, any successor or substitute index selected by the Calculation Agent in its sole discretion) with
the same GICS Code (as defined below) as the applicable original Underlying Stock Issuer; provided, however, that a Replacement
Stock will not include (i) any stock that is subject to a trading restriction under the trading restriction policies of the Company,
the hedging counterparties of the Company or any of their affiliates that would materially limit the ability of the Company, the
hedging counterparties of the Company or any of their affiliates to hedge this Security with respect to such stock or (ii) any
stock for which the aggregate number of shares to be referenced by this Security (equal to the product of (a) (i) $100 divided
by (ii) the Starting Price of the applicable Underlying Stock, (b) the Adjustment Factor that would be in effect immediately
after selection of such stock as the Replacement Stock and (c) (i) the aggregate face amount outstanding divided by (ii)
$1,000) exceeds 25% of the ADTV (as defined in Rule 100(b) of Regulation M under the Exchange Act) for such stock as of the effective
date of the Replacement Stock Event (an “Excess ADTV Stock”).

If
a Replacement Stock is selected in connection with a Reorganization Event for an original Underlying Stock, the Adjustment Factor
with respect to such Replacement Stock will be equal to the number of shares of such Replacement Stock with an aggregate value,
based on the Closing Price on the effective date of such Reorganization Event, equal to the product of (a) the value of the
Non-Stock Reorganization Property received per share of such original Underlying Stock and (b) the Adjustment Factor of such Underlying
Stock in effect on the Trading Day immediately prior to the effective date of such Reorganization Event. If a Replacement Stock
is selected in connection with an ADS Termination Event (as defined below), the Adjustment Factor with respect to such Replacement
Stock will be equal to the number of shares of such Replacement Stock with an aggregate value, based on the Closing Price on the
Change Date (as defined below), equal to the product of (x) the Closing Price of the original Underlying Stock on the Change Date
and (y) the Adjustment Factor in effect on the Trading Day immediately prior to the Change Date.

The
“Option Period Volatility” means, in respect of any Trading Day, the volatility (calculated by referring to
the Closing Price of the applicable Underlying Stock on its primary exchange) for a period equal to the 125 Trading Days immediately
preceding the announcement date of the Reorganization Event, as determined by the Calculation Agent.

    	15 

    	 

    

“GICS
Code” means the Global Industry Classification Standard (“GICS”) sub-industry code assigned to the
applicable Underlying Stock Issuer; provided, however, if (i) there is no other stock in the Replacement Stock Selection Index
in the same GICS sub-industry or (ii) a Replacement Stock (a) for which there is no trading restriction and (b) that is not
an Excess ADTV Stock cannot be identified from the Replacement Stock Selection Index in the same GICS sub-industry, the GICS Code
will mean the GICS industry code assigned to such original Underlying Stock Issuer. If no GICS Code has been assigned to such
original Underlying Stock Issuer, the applicable GICS Code will be determined by the Calculation Agent to be the GICS sub-industry
code assigned to companies in the same sub-industry (or, subject to the proviso in the preceding sentence, industry, as applicable)
as such original Underlying Stock Issuer at the time of the relevant Replacement Stock Event.

The
“Replacement Stock Selection Index” means the S&P 500® Index.

Delisting
of American Depositary Shares or Termination of American Depositary Receipt Facility.

If
an Underlying Stock is an American Depositary Share and such Underlying Stock is no longer listed or admitted to trading on a
U.S. securities exchange registered under the Exchange Act or included in the OTC Bulletin Board Service operated by FINRA, or
if the American depositary receipt facility between the applicable Underlying Stock Issuer and the depositary is terminated for
any reason (each, an “ADS Termination Event”), then, on the last Trading Day on which the applicable Underlying
Stock is listed or admitted to trading or the last Trading Day immediately prior to the date of such termination, as applicable
(the “Change Date”), a Replacement Stock Event shall be deemed to occur.

Calculation
Agent

The
Calculation Agent will determine whether this Security will be automatically called prior to stated maturity and whether a Contingent
Coupon Payment will be made, the Call Price, if any, and the Maturity Payment Amount, if any. In addition, the Calculation Agent
will (i) determine the Closing Prices of the Underlying Stocks under the circumstances described in this Security, (ii) determine
if adjustments are required to the Closing Price or Adjustment Factor of an Underlying Stock under the circumstances described
in this Security, (iii) select a Replacement Stock under the circumstances described in this Security and (iv) determine
whether a Market Disruption Event 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.

    	16 

    	 

    

Redemption
and Repayment

This
Security is not subject to repayment at the option of the Holder hereof prior to August 19, 2021. Except as set forth above under
“Automatic Call,” this Security is not subject to redemption prior to August 19, 2021. 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 Maturity Payment
Amount (calculated as set forth in the next two sentences) 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 Maturity Payment Amount hereof calculated as provided herein, plus a portion of a final Contingent Coupon
Payment, if any. The Maturity Payment Amount and any final Contingent Coupon Payment will be calculated as though the date of
acceleration were the Final Calculation Day. The final Contingent Coupon Payment, if any, will be prorated from and including
the immediately preceding Contingent Coupon Payment Date to but excluding the date of acceleration.

__________________

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]

 

    	17 

    	 

    
  

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

DATED:

 

	 	WELLS FARGO & COMPANY
	 	 

 

	 	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	 

 

 

    	18 

    	 

    

 

[Reverse
of Note]

 

 

WELLS
FARGO & COMPANY

 

MEDIUM-TERM
NOTE, SERIES S

 

Due
Nine Months or More From Date of Issue

 

Principal
at Risk Securities Linked to the Lowest Performing of the

Common Stock of Philip Morris International Inc. and the Common Stock of Altria Group, Inc. due August 19, 2021

 

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 February 21, 2017, as amended or supplemented from time
to time (herein called the “Indenture”), between the Company 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 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 S, 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.

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 rights of the Holders of the Securities of each series to be affected under the Indenture at any time by
the Company and the Trustee with the consent of the Holders of a majority in principal 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 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.

    	19 

    	 

    

 

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

    	20 

    	 

    

 

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 Trustee and any agent of the Company 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 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 Contingent Coupon Payments, if any, and the Maturity Payment Amount or
the Call Price, as applicable, on this Security 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 any Contingent Coupon Payments or the Maturity Payment Amount or the Call Price, as applicable,
on this Security 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, 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. 

 

    	21 

    	 

    

 

 

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)

 

    	22 

    	 

    

 

the
within Security of WELLS FARGO & COMPANY 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.

 

   

 

    	23Exhibit 4.6

 

EXHIBIT 1

to Annex I

 

[FORM OF FACE OF INITIAL NOTE]

 

[Global Notes Legend]

 

UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO 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.

 

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO THE DEPOSITORY, TO NOMINEES OF THE DEPOSITORY OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

 

[Restricted Notes Legend]

 

THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF
THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) SUCH SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED, ONLY (1)(a) INSIDE THE UNITED STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT, (b) OUTSIDE THE UNITED STATES TO A FOREIGN
PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (c) IN A PRINCIPAL
AMOUNT OF NOT LESS THAN $250,000 TO AN INSTITUTIONAL ACCREDITED INVESTOR (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE
ISSUER IF THE ISSUER SO REQUESTS) OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER IF THE ISSUER SO REQUESTS), (2) TO THE ISSUER OR (3) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN CLAUSE (A) ABOVE. THE HOLDER HEREOF, BY PURCHASING
THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE ISSUER THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING
OF RULE 144A UNDER THE SECURITIES ACT, (2) NOT A U.S. PERSON AND IS OUTSIDE OF THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT
SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2)(i) OF RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT OR (3) IF THE HOLDER
IS PURCHASING THIS SECURITY IN A TRANSACTION PURSUANT TO (A)(1)(c) ABOVE, AN INSTITUTIONAL ACCREDITED INVESTOR.

 

    -I-1-

     

    

 

[Additional Regulation S Restricted
Notes Legend]

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION, AND MAY NOT
BE OFFERED, SOLD OR DELIVERED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON, UNLESS SUCH NOTES
ARE REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS THEREOF IS AVAILABLE. THIS LEGEND WILL
BE REMOVED AFTER THE EXPIRATION OF FORTY DAYS FROM THE LATER OF (i) THE DATE ON WHICH THESE NOTES WERE FIRST OFFERED AND (ii) THE
DATE OF ISSUE OF THESE NOTES.

 

[Definitive Notes Legend]

 

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM
THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

 

[OID Legend]

 

THIS NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT (“OID”)
FOR UNITED STATES FEDERAL INCOME TAX PURPOSES. UPON REQUEST, THE ISSUER WILL PROMPTLY MAKE AVAILABLE TO A HOLDER OF THIS NOTE INFORMATION
REGARDING THE ISSUE PRICE, THE AMOUNT OF OID, THE ISSUE DATE AND THE YIELD TO MATURITY OF THIS NOTE. HOLDERS SHOULD CONTACT INTERNATIONAL
SEAWAYS, INC., 600 THIRD AVENUE, 39th FL., NEW YORK, NEW YORK 10016, ATTENTION: GENERAL COUNSEL.

 

    -I-2-

     

    

 

10.75% Step-Up Notes due 2023

 

	No.	$__________________
	 	 
	 	CUSIP No.__________

 

International Seaways, Inc. (the “Issuer”),
a Marshall Islands corporation, promises to pay to [ ________]1,
or registered assigns, the principal sum [of ________ U.S. dollars]2
on the maturity date set forth on the other side of this Note.

 

Interest Payment Dates: March 15, June 15,
September 15 and December 15 (commencing on September 15, 2018).

 

Regular Record Dates: March 1, June 1, September
1 and December 1.

 

Additional provisions of this Note are set
forth on the other side of this Note.

 

 

		1	For Global Notes insert: Cede & Co.

		2	For Global Notes insert: set forth on the Schedule of Increases
or Decreases in Global Note attached hereto

 

    -I-3-

     

    

 

	Dated:	 
	 	 
	INTERNATIONAL SEAWAYS, INC.	 
	 	 
	By:	 	 
	 	Name:	 
	 	Title:	 

 

    -I-4-

     

    

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

Dated: _________________

 

This is one of the Notes referred to in the within-mentioned
Indenture.

 

	GLAS TRUST COMPANY LLC, as Trustee	 
	 	 
	By:	 	 
	 	Authorized Signatory	 

 

    -I-5-

     

    

 

[FORM OF REVERSE SIDE OF INITIAL NOTE]

 

1.       Principal and
Interest.

 

The Issuer will pay the principal of this
Note on June 15, 2023; provided, that if the Indebtedness outstanding under the Senior Credit Agreement is extended, renewed,
refunded, refinanced, replaced, defeased or discharged (such date, the “Refinance Date”), the Stated Maturity of the
principal of Notes shall be June 15, 2022.

 

The Issuer promises to pay interest on the
principal amount of this Note on each Interest Payment Date, as set forth below, at the rate of 10.75% per annum from the Issue
Date, or from the most recent Interest Payment Date to which interest has been paid or duly provided for; provided, that
the Notes shall bear interest at the rate of 13.00% per annum beginning on the earlier of (i) December 15, 2020 and (ii) if the
Refinance Date has occurred, the later of the Refinance Date and June 15, 2020.

 

Interest will be payable quarterly in arrears
(to the Holders of record at the close of business (if applicable) on the March 1, June 1, September 1 and December 1 (whether
or not a Business Day) immediately preceding the Interest Payment Date) on each Interest Payment Date, commencing September
15, 2018.

 

Interest on this Note will accrue from the
most recent date to which interest has been paid or duly provided for or, if no interest has been paid or duly provided for, from
June 13, 2018; provided that, if there is no existing default in the payment of interest and if this Note is authenticated
between a Regular Record Date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue
from such Interest Payment Date. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

 

The Issuer shall pay interest on overdue principal
and premium, if any, and interest on overdue installments of interest, to the extent lawful, at a rate per annum equal to the rate
of interest borne by the Notes.

 

2.       Method of Payment.

 

The Issuer will pay interest (except Defaulted
Interest) on the principal amount of the Notes on each March 15, June 15, September 15 and December 15 (commencing on September
15, 2018) to the Persons who are Holders (as reflected in the Note Register at the close of business (if applicable) on the
March 1, June 1, September 1 and December 1 (whether or not a Business Day) immediately preceding the Interest Payment Date), in
each case, even if the Note is cancelled on registration of transfer or registration of exchange after such Regular Record Date;
provided that, with respect to the payment of principal or premium, if any, the Issuer will make payment to the Holder that
surrenders this Note to the Paying Agent on or after the date such principal or premium is due and payable.

 

The Issuer will pay principal (and premium,
if any) and interest in U.S. dollars. However, the Issuer may pay principal (and premium, if any) and interest by its check payable
in such money. The Issuer may pay interest on the Notes either (a) by mailing a check for such interest to a Holder’s
registered address (as reflected in the Note Register) or (b) subject to the provisions of the Indenture, by wire transfer
to an account located in the United States maintained by the payee. If a payment date is a date other than a Business Day at a
place of payment, payment may be made at that place on the next succeeding day that is a Business Day and no interest shall
accrue for the intervening period.

 

    -I-6-

     

    

 

3.       Paying Agent
and Note Registrar.

 

The Issuer initially appoints GLAS Trust Company
LLC, in New York as Paying Agent and Note Registrar. The Issuer may change any Paying Agent or Note Registrar upon written notice
thereto. The Issuer or any of its Subsidiaries may act as Paying Agent, Note Registrar or co-registrar.

 

4.       Indenture.

 

The Issuer issued the Notes under an Indenture
dated as of June 13, 2018 (the “Indenture”), among the Issuer and the Trustee. Capitalized terms herein are used as
defined in the Indenture unless otherwise indicated. The terms of the Notes include those stated in the Indenture. The Notes are
subject to all such terms, and Holders are referred to the Indenture for a statement of all such terms. To the extent permitted
by applicable law, in the event of any inconsistency between the terms of this Note and the terms of the Indenture, the terms of
the Indenture shall control.

 

The Notes are unsecured obligations of the
Issuer, subordinated in right of payment in the event of a bankruptcy, reorganization or similar proceeding.

 

5.       Redemption.

 

Optional Redemption. At any time prior
to June 15, 2020, the Issuer may, at its option and on one or more occasions, redeem all or a part of the Notes, upon notice
as described in Section 11.07 of the Indenture, at a Redemption Price equal to 100% of the principal amount of the Notes redeemed
plus the Applicable Premium as of, and accrued and unpaid interest, if any, to, but excluding, the Redemption Date, subject to
the right of Holders of record on the relevant Regular Record Date to receive interest due on the relevant Interest Payment Date
falling on or prior to the Redemption Date.

 

On and after August 15, 2020, the Issuer may,
at its option and on one or more occasions, redeem the Notes, in whole or in part, upon notice as described in Section 11.07 of
the Indenture, at a Redemption Price equal to 100% of the principal amount of the Notes redeemed, plus accrued and unpaid interest,
if any, to, but excluding, the applicable Redemption Date, subject to the right of Holders of record on the relevant Regular Record
Date to receive interest due on the relevant Interest Payment Date falling on or prior to the Redemption Date.

 

In addition, the Issuer may redeem the Notes,
at its option, at any time in whole but not in part, upon not less than 30 nor more than 60 days’ notice (which notice will
be irrevocable), at a Redemption Price equal to 100% of the outstanding principal amount of Notes, plus accrued and unpaid interest
(if any) to, but not including, the applicable Redemption Date and all Additional Amounts (if any) then due and which will become
due on the applicable Redemption Date (subject to the right of Holders of record on the relevant record date to receive interest
due on the relevant Interest Payment Date and Additional Amounts (if any) in respect thereof), in the event that the Issuer determines
in good faith that the Issuer has become or would become obligated to pay, on the next date on which any amount would be payable
with respect to the Notes, Additional Amounts and such obligation cannot be avoided by taking reasonable measures available to
the Issuer (including making payment through a Paying Agent located in another jurisdiction), as a result of:

 

		(a)	a change in or an amendment to the laws (including any regulations or rulings promulgated thereunder) of any Specified Tax
Jurisdiction affecting taxation, which change or amendment is announced or becomes effective on or after the date of the Indenture;
or

 

    -I-7-

     

    

 

		(b)	any change in or amendment to any official position of a taxing authority in any Specified Tax Jurisdiction regarding the application,
administration or interpretation of such laws, regulations or rulings (including a holding, judgment or order by a court of competent
jurisdiction), which change or amendment is announced or becomes effective on or after the date of the Indenture.

 

6.       Special
Mandatory Redemption. In the event the Termination Event occurs, the Issuer shall redeem all of the Notes at the Special Mandatory
Redemption Price equal to 100% of the aggregate issue price of the Notes, plus accrued but unpaid interest, if any, from the Issue
Date to, but excluding, the Special Mandatory Redemption Date (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date). Notice of the Special Mandatory Redemption shall be delivered
by the Issuer, no later than one Business Day following the date on which the Termination Event occurs, to the Trustee and the
Paying Agent, and shall provide that the Notes shall be redeemed on a date that is no later than the third Business Day after such
notice is given by the Issuer.

 

7.       Denominations;
Transfer; Exchange.

 

The Notes are in registered form without coupons
in denominations of $2,000 principal amount and integral multiples of $1,000 in excess thereof. A Holder may transfer
or exchange Notes in accordance with the Indenture. The Note Registrar and the Issuer may require a Holder, among other things,
to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.
The Note Registrar and the Issuer need not register the transfer or exchange of any Notes selected for redemption (except, in the
case of a Note to be redeemed in part, the portion of the Note not to be redeemed) or any Notes tendered (and not withdrawn)
for repurchase in connection with a tender offer. Also, the Issuer shall not be required to register the transfer or exchange of
any registered Definitive Notes for a period of 15 days preceding (a) the record date for any payment of interest on the applicable
Notes, (b) any date fixed for redemption of the applicable Notes or (c) the date fixed for selection of the applicable Notes to
be redeemed in part. In addition, the Issuer shall not be required to register the transfer or exchange of any Notes selected for
redemption.

 

8.       Persons Deemed
Owners.

 

A registered Holder may be treated as the
owner of a Note for all purposes.

 

9.       Unclaimed Money.

 

If money for the payment of principal (premium,
if any) or interest remains unclaimed for two years, the Trustee and the Paying Agent will pay the money back to the Issuer
at its written request. After that, Holders entitled to the money must look to the Issuer for payment, unless an abandoned
property law designates another Person, and all liability of the Trustee and such Paying Agent with respect to such money shall
cease.

 

10.       Discharge and
Defeasance Prior to Redemption or Maturity.

 

If the Issuer irrevocably deposits, or causes
to be deposited, with the Trustee money or U.S. Government Obligations sufficient to pay the then outstanding principal of (premium,
if any) and accrued but unpaid interest on the Notes to the Redemption Date or Stated Maturity, the Issuer will be discharged from
its obligations under the Indenture and the Notes, except in certain circumstances for certain covenants thereof, or will be discharged
from certain covenants set forth in the Indenture.

 

    -I-8-

     

    

 

11.       Amendment; Supplement;
Waiver.

 

Subject to certain exceptions, the Indenture,
the Notes or any Note Guarantee may be amended or supplemented with the consent of the Holders of at least a majority in aggregate
principal amount of the then Outstanding Notes, other than Notes beneficially owned by the Issuer or its Affiliates, and any existing
Default or Event of Default or compliance with any provision of the Indenture, the Notes or any Note Guarantee may be waived with
the consent of the Holders of at least a majority in aggregate principal amount of the then Outstanding Notes, other than Notes
beneficially owned by the Issuer or its Affiliates. Without notice to or the consent of any Holder, the parties thereto may amend
or supplement the Indenture, the Notes or any Note Guarantee to, among other things, cure any ambiguity, omission, mistake, defect
or inconsistency and make any change that does not adversely affect the legal rights under the Indenture of any Holder in any material
respect.

 

12.       Restrictive
Covenants.

 

The Indenture contains certain restrictive
covenants as set forth therein. Within 120 days after the end of each fiscal year, the Issuer must report to the Trustee
on compliance with such limitations.

 

13.       Successor Persons.

 

When a successor Person or other entity assumes
all the obligations of its predecessor under the Notes or any Note Guarantee and the Indenture, the predecessor Person will be
released from those obligations.

 

14.       Remedies for
Events of Default.

 

If an Event of Default, as defined in the
Indenture, occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the Outstanding
Notes may declare the principal, premium, if any, interest and any other monetary obligations on all the then Outstanding Notes
to be due and payable immediately by a notice in writing to the Issuer (and to the Trustee if given by Holders). Subject to the
provisions of the Indenture relating to the duties of the Trustee, in case an Event of Default occurs and is continuing, the Trustee
shall be under no obligation to exercise any rights or powers under the Indenture at the request or direction of any of the Holders
unless such Holders have offered indemnity or security against any loss, liability or expense satisfactory to the Trustee. Subject
to certain restrictions, the Holders of a majority in aggregate principal amount of the Outstanding Notes are given the right to
direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust
or power conferred on the Trustee. The Trustee, however, may refuse to follow any direction that conflicts with law or the Indenture
or that the Trustee determines is unduly prejudicial to the rights of any other Holder of a Note or that would involve the Trustee
in personal liability.

 

15.       Trustee Dealings
with Issuer.

 

The Trustee under the Indenture, in its individual
or any other capacity, may become the owner or pledgee of Notes and may make loans to, accept deposits from, perform services for,
and otherwise deal with, the Issuer and its Affiliates as if it were not the Trustee.

 

    -I-9-

     

    

 

16.       Authentication.

 

This Note shall not be valid until the Trustee
manually signs the certificate of authentication on the other side of this Note.

 

17.       Abbreviations.

 

Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (= Custodian) and U/G/M/A (= Uniform Gifts to Minors Act).

 

18.       CUSIP Numbers.

 

Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Issuer has caused CUSIP numbers to be printed on the Notes and
the Trustee may use CUSIP numbers in notices as a convenience to Holders. No representation is made as to the accuracy of such
numbers either as printed on the Notes or as contained in any notice and reliance may be placed only on the other identification
numbers placed thereon.

 

19.       Governing Law.

 

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. THE ISSUER AGREES TO SUBMIT TO THE JURISDICTION OF ANY UNITED STATES FEDERAL
OR STATE COURT LOCATED IN THE BOROUGH OF MANHATTAN, IN THE CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS NOTE OR THE INDENTURE.

 

The Issuer will furnish to any Holder upon
written request and without charge a copy of the Indenture. Requests may be made to International Seaways, Inc., 600 Third
Avenue, 39th Fl., New York, New York 10016, Attention: General Counsel.

 

Capitalized terms used herein but not defined
herein shall have the meanings given to such terms in the Indenture.

 

    -I-10-

     

    

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

I or we assign and transfer this Note to

 

(Print or type assignee’s name, address and
zip code)

 

(Insert assignee’s soc. sec. or tax I.D. No.)

 

and irrevocably appoint ___________________ agent to transfer
this Note on the books of the Issuer. The agent may substitute another to act for him.

 

	 
	Date:______________	Your Signature:	 
	 

 

Sign exactly as your name appears on the other side of this
Note.

 

The undersigned confirms that such Notes are being transferred
in accordance with their terms:

 

CHECK ONE BOX BELOW

 

 ̈to
the Issuer; or

 

		(1)	 ̈	pursuant to an effective registration statement
under the Securities Act; or

 

		(2)	 ̈	inside the United States to a Person reasonably believed to be a “qualified
institutional buyer” (as defined in Rule 144A under the Securities Act) that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that such transfer is being made in reliance on Rule 144A,
in each case pursuant to and in compliance with Rule 144A under the Securities Act;

 

		(3)	 ̈	outside the United States in an offshore transaction within the meaning of Regulation S
under the Securities Act in compliance with Rule 904 under the Securities Act;

 

		(4)	 ̈	pursuant to the exemption from registration
provided by Rule 144 under the Securities Act; or

 

		(5)	 ̈	to an institutional “accredited investor” (as defined in Rule
501(a)(1),(2),(3) or (7) under the Securities Act) that is purchasing for its own account or for the account of such an institutional
 “accredited investor” at least $250,000 principal amount of the Notes, not with a view to, or for offer or sale in
connection with, any distribution in violation of the Securities Act.

 

Unless one of the boxes is checked, the Trustee will refuse
to register any of the Notes evidenced by this certificate in the name of any person other than the registered holder thereof.

 

    -I-11-

     

    

 

	 	 	 
	Signature	 	 
	 	 	 
	Signature Guarantee:	 	 
	 	 	 
	 	 	 
	Signature must be guaranteed	 	Signature

 

Signatures must be guaranteed by an “eligible
guarantor institution” meeting the requirements of the Note Registrar, which requirements include membership or participation
in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program”
as may be determined by the Note Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.

 

    -I-12-

     

    

 

 

TO BE COMPLETED BY PURCHASER IF (2) ABOVE
IS CHECKED.

 

The undersigned represents and warrants that
it is purchasing this Note for its own account or an account with respect to which it exercises sole investment discretion and
that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities
Act, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information
regarding the Issuer as the undersigned has requested pursuant to Rule 144A or has determined not to request such information
and that it is aware that the transferor is relying upon the undersigned’s foregoing representations in order to claim the
exemption from registration provided by Rule 144A.

 

	
         Dated:
	
	 	 
	 	 	
        Notice: To be executed by

        an executive officer

 

    -I-13-

     

    

 

[TO BE ATTACHED TO GLOBAL NOTES]

 

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL
NOTE

The initial principal amount of this Global
Note is $________________. The following increases or decreases in this Global Note have been made:

 

	 	 
Date
                                         of Exchange
	 	 	 	Amount
                                         of
 decrease in
 Principal amount
 of this Global
 Note
	 	 	 	Amount
                                         of
 increase in
 Principal amount
 of this Global
 Note
	 	 	 	Principal
                                         amount
 of this Global
 Note following
 such decrease or
 increase
	 	 	 	Signature
                                         of
 authorized
 signatory of
 Trustee or Notes
 Custodian
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

    -I-14-

     

    

 

EXHIBIT 2

to Annex I

 

Form of

Transferee Letter of Representation

 

INTERNATIONAL SEAWAYS, INC.

c/o International Seaways Ship Management LLC

600 Third Avenue, 39th Floor

New York, New York 10016

 

In care of

GLAS Trust Company LLC

230 Park Avenue, 10th Floor

New York, New York 10169

 

Ladies and Gentlemen:

 

This certificate is delivered to request a transfer of $___________
principal amount of the 10.75% Step-Up Notes due 2023 (the “Notes”) of INTERNATIONAL SEAWAYS INC., a Marshall Islands
corporation (the “Company”).

 

Upon transfer, the Notes would be registered in the name of
the new beneficial owner as follows:

 

	Name: ___________________________________	 
	 	 
	Address: _________________________________	 
	 	 
	Taxpayer ID Number:_______________________	 

 

The undersigned represents and warrants to you that:

 

		1.	We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act of 1933, as amended (the “Securities Act”)), purchasing for our own account or for the account of such an institutional
 “accredited investor” at least $250,000 principal amount of the Notes, and we are acquiring the Notes not with a view
to, or for offer or sale in connection with, any distribution in violation of the Securities Act. We have such knowledge and experience
in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we invest
in or purchase securities similar to the Notes in the normal course of our business. We, and any accounts for which we are acting,
are each able to bear the economic risk of our or its investment.

 

    -I-15-

     

    

 

		2.	We understand that the Notes have not been registered under the Securities Act and, unless so registered, may not be sold except
as permitted in the following sentence. We agree on our own behalf and on behalf of any investor account for which we are purchasing
Notes to offer, sell or otherwise transfer such Notes only (i) to a person who is a qualified institutional buyer in a transaction
meeting the requirements of Rule 144A under the Securities Act (“Rule 144A”), in a transaction meeting the requirements
of Rule 144 under the Securities Act (if available), (ii) outside the United States to a Non-U.S. Person in a transaction meeting
the requirements of Rule 904 under the Securities Act, to an institutional “accredited investor” within the meaning
of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is an institutional accredited investor purchasing for its own
account, (iii) for the account of an institutional accredited investor, in each case in a minimum principal amount of the Notes
of $250,000, (iv) or in accordance with another exemption from the registration requirements of the Securities Act (and based upon
an opinion of counsel, if the Company so requests), (v) to the Company or (vi) pursuant to an effective registration statement
and, in each case, in accordance with any applicable securities laws of any state of the United States or any other applicable
jurisdiction. The transferor shall deliver a letter from the transferee substantially in the form of this letter to the Company
and the Trustee, which shall provide, among other things, that the transferee is an to “qualified institutional buyer”
within the meaning of Rule 144A, an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act and that it is acquiring such Notes for investment purposes, or a Non-U.S. Persons (as defined
in Regulation S under the Securities Act), and each case not for distribution in violation of the Securities Act. Each purchaser
acknowledges that the Company and the Trustee reserve the right prior to the offer, sale or other transfer of the Notes pursuant
to clause (i) through (iv) above to require the delivery of an opinion of counsel, certifications and other information satisfactory
to the Company and the Trustee.

 

	 	TRANSFEREE: ________________________
	 	 
	 	By: _________________________________

 

    -I-16-

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