Document:

Exhibit 10.5

 

SEPARATION AGREEMENT AND GENERAL RELEASE

 

This Separation Agreement and General Release (this “Separation Agreement”) is entered into by and between Stewart P. Skelly, an individual (“Executive”) and Warren Resources, Inc., a Maryland corporation (the “Company”), effective as of the Effective Date (as defined below). Capitalized terms used and not otherwise defined herein are used as defined in the Agreement (as defined below).

 

WHEREAS, the Company and the Executive are parties to that certain Retention and Severance Agreement dated October 15, 2015 (the “Agreement”); and

 

WHEREAS, the Executive offered his resignation from all of his positions as an officer of the Company, effective November 6, 2015 (the “Separation Date”);

 

NOW THEREFORE, in consideration of the foregoing premises and certain other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Executive and Company hereby mutually agree as follows:

 

1.                                      Status. On the Separation Date, Executive’s position as Chief Financial Officer, Chief Accounting Officer, Director of various wholly owned Company subsidiaries and any other appointments and offices held with the Company, and any position with any third party organizations in which he represented the Company, ended.

 

2.                                      Separation Benefits. Provided Executive executes this Separation Agreement, and does not revoke it during the Revocation Period (as defined below), the Company agrees to provide the Executive with the following payments and benefits (collectively, the “Separation Benefits”):

 

(a)                                 The Company shall pay to the Executive, in a lump-sum, an amount equal to $275,000, less all applicable authorized and required deductions and withholdings. This amount shall be payable within 14 days after the Effective Date (as defined below).

 

(b)                                 Provided Executive elects to continue his medical care coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the Company will pay the premiums associated with such continued coverage on the first of each month commencing on December 1, 2015 and continuing until the earlier of (i) the date that the Executive becomes covered by the medical plan of a subsequent employer, (ii) the date he is no longer eligible for continued medical coverage pursuant to COBRA, and (iii) August 6, 2016 (inclusive).

 

3.                                      Accrued Obligations. Executive acknowledges and agrees that the Company has paid him all amounts due to him for accrued and unpaid obligations through his Separation Date, including without limitation his accrued, but unpaid, base salary, accrued but unpaid benefits and expenses. Executive acknowledges and agrees that he is not due any compensation for unpaid salary, bonus, severance, incentive or performance pay, unreimbursed and properly incurred business expenses, or accrued or unused vacation time or vacation pay.

 

4.                                      No Other Payments. Other than as specifically provided by, or preserved under, the terms and conditions of this Separation Agreement, Executive will not be entitled to any other payments or benefits from the Company. For the avoidance of doubt, there shall be no accelerated vesting of any equity awards received by Executive prior to his Separation Date. Notwithstanding the terms of any equity compensation plan or related award agreement, Executive acknowledges that all unvested restricted stock, stock options and other equity compensation awards were forfeited upon of the Separation Date and all vested stock options shall expire after three (3) months from the Separation Date.

 

5.                                      Executive’s Release of Claims; Representations; Acknowledgments. In consideration for the Separation Benefits and other promises and covenants contained herein, Executive agrees to the following:

 

(a)                                 Executive represents that Executive has not filed any complaints, charges or lawsuits against the Company with any governmental agency or any court.

 

(b)                                 Executive expressly waives all claims against the Company and releases the Company, and any of the Company’s past, present or future parent, affiliated, related, and/or subsidiary entities (collectively with the Company, the “Company Entities”), and all of the past and present directors, shareholders, officers, general or limited partners, employees, agents, and attorneys, and agents and representatives of such entities, and employee benefit plans in which Executive is or has been a participant by virtue of his employment with the Company (collectively, the “Releasees”), from any claims that Executive may have against any

 

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Company Entity or the Releasees. It is understood that this release includes, but is not limited to, any claims arising directly or indirectly out of, relating to, or in any other way involving in any manner whatsoever, (1) Executive’s employment with any Company Entity or the termination thereof or (2) Executive’s status at any time as a holder of any securities of the Company, including any claims for wages, stock or stock options, employment benefits or damages of any kind whatsoever arising out of the Agreement, any contracts, express or implied, any Company policy, any covenant of good faith and fair dealing, express or implied, any legal restriction on the Company’s right to terminate employment, or any federal, state or other governmental statute or ordinance, including, without limitation, the Employee Retirement Income Security Act of 1974, Title VII of the Civil Rights Act of 1964, the federal Age Discrimination in Employment Act, the Americans With Disabilities Act, the Family and Medical Leave Act, the Lilly Ledbetter Fair Pay Act, the Genetic Information Non-Discrimination Act, the New York Human Rights Law, the New York City Human Rights Law, all as amended, and any other federal, state or local law (the “Release”). This Release specifically includes, but is not limited to, any claims based upon the right to the payment of wages, incentive and performance compensation, bonuses, vacation, stock benefits or any other employee benefits, or any other rights arising under federal, state or local laws prohibiting discrimination and/or harassment on the basis of race, color, age, religion, sexual orientation, religious creed, sex, national origin, ancestry, alienage, citizenship, nationality, mental or physical disability, denial of family and medical care leave, medical condition (including cancer and genetic characteristics), marital status, military status, gender identity, harassment or any other basis prohibited by law provided, however, notwithstanding anything to the contrary set forth herein, that this Release shall not extend to (i) benefit claims under employee welfare benefit plans for occurrences (e.g., medical care, death, or onset of disability) arising after the Effective Date, (ii) Executive’s rights to Severance Benefits, provided he complies with his obligations herein; (iii) any claims Executive may have for indemnification pursuant to law, contract, Company governance documents, or Company policy, (iv) any claims for coverage under any applicable directors’ and officers’ insurance policy, or any other applicable insurance policy, in accordance with the terms of such policy, or (v) any claims arising from events that occur after the Effective Date. Notwithstanding this release of liability, nothing in this Separation Agreement prevents Executive from filing any non-legally waivable claim (including a challenge to the validity of this Agreement) with the Equal Employment Opportunity Commission (“EEOC”) or comparable state or local agency or participating in any investigation or proceeding conducted by the EEOC or comparable state or local agency or cooperating with such agency; however, Executive understands and agrees that Executive is waiving any and all rights to recover any monetary or personal relief or recover as a result of such EEOC or comparable state or local agency or proceeding or subsequent legal actions

 

(c)                                  Executive understands that the Release includes a release of claims arising under the Age Discrimination in Employment Act (the “ADEA”). Executive understands and warrants that Executive has been given up to twenty-one (21) days to review and consider this Separation Agreement, and Executive further warrants that Executive understands that Executive has a period of seven days (7) after his execution of this Separation Agreement to revoke it by notice in writing to the Company (the “Revocation Period”). This Separation Agreement will be effective on the eighth (8th) day after the Executive signs the Separation Agreement, provided he does not exercise his right to revoke it during the Revocation Period (such date, the “Effective Date”).

 

(d)                                 Executive has carefully read and has voluntarily signed this Separation Agreement.

 

(e)                                  Executive fully understands the final and binding effective of the Release contained herein and other covenants of the Separation Agreement, including the waiver of all claims under the ADEA.

 

(f)                                   Prior to signing this Separation Agreement, the Company advised the Executive of his right to consult, and has been given adequate time to review, his legal rights with his attorney of choice.

 

6.                                      Continuing Obligations.

 

(a)                                 Noncompetition. During the period (the “Restricted Period”) commencing on the Separation Date and ending on the first anniversary of the Separation Date, the Executive shall not, (i) within ten (10) miles of any location in which, as of the Separation Date, the Company owns Assets, directly or indirectly, own, manage, operate, control, or participate in the ownership, management, operation or control of any Business, provided that the Executive’s ownership of securities of two percent (2%) or less of any class of securities of a public company shall not, by itself, be considered to be competition with the Company or any Affiliate; (ii) acquire, offer to acquire, or agree to acquire, directly or indirectly, or through his affiliate, by purchase or otherwise, voting securities or direct or indirect right to acquire voting securities of the Company, that, together with any Company securities then beneficially owned by Executive on the relevant date, or issuable upon Executive’s exercise of equity awards outstanding, would result in the aggregate beneficial ownership of him, or of any entity that he directly or indirectly, owns, manages, operates, or controls, or in which Executive participates in the ownership, management, operation or control, to equal 5% or more of the Company’s voting securities; (iii) make or in any way participate, directly or indirectly, in any “solicitation” of “proxies” to vote (as such terms are used in the rules and regulations of the Securities and Exchange Commission), or seek to advise or influence any person or entity with respect to the voting of any voting securities of the Company; (iv) make any public announcement with respect to, or submit a proposal for, or offer of (with or without conditions) any extraordinary transaction involving the Company or any of its securities or

 

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assets; or (v) form, join or in any way participate in a “group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, in connection with any of the foregoing actions. For purposes of this Separation Agreement, “Business” shall mean the ownership of oil and/or gas assets, and “Assets” means the Company’s oil and/or gas assets.

 

(b)                                 Nonsolicitation. During the Restricted Period the Executive shall not, directly or indirectly, and any entity to which Executive is providing services shall not, directly or indirectly, (i) employ, solicit for employment or otherwise contract for the services of any individual who is or was an employee of the Company; (ii) otherwise induce or attempt to induce any employee of the Company to leave the employ of the Company, or in any way interfere with the relationship between the Company any employee respectively thereof; or (iii) induce or attempt to induce any customer, supplier, licensee or other business relation of the Company or any Affiliate to cease doing business with the Company, or interfere in any way with the relationship between any such customer, supplier, licensee or business relation and the Company.

 

(c)                                  Non-Disclosure. The Executive shall not (i) divulge, transmit or otherwise disclose , directly or indirectly, other than in the regular and proper course of business of the Company, any trade secrets or other confidential knowledge or information with respect to the operations or finances of the Company or any Affiliates or with respect to confidential or secret processes, services, techniques, customers or plans with respect to the Company (all of the foregoing collectively hereinafter referred to as, “Confidential Information”), or (ii) use, directly or indirectly, any Confidential Information for the benefit of anyone other than the Company; provided, however, that the Executive has no obligation, express or implied, to refrain from using or disclosing to others any such knowledge or information which is or hereafter shall become available to the general public other than through disclosure by the Executive. All Confidential Information, new processes, techniques, know-how, methods, inventions, plans, products, patents and devices developed, made or invented by the Executive, alone or with others, while an employee of the Company which are related to the business of the Company and the Affiliates shall be and become the sole property of the Company, unless released in writing by the Board, and the Executive hereby assigns any and all rights therein or thereto to the Company. Nothing contained herein prohibits the Executive from: (i) disclosing Confidential Information when compelled to do so by law; (ii) making a good faith report of possible violations of applicable law to any governmental agency or entity; or (iii) or making disclosures that are protected under the whistleblower provisions of applicable law.

 

(d)                                 Return of Company Property. Executive acknowledges and agrees that all Confidential Information, files, records, correspondence, memoranda, notes or other documents (including, without limitation, those in computer-readable form) or property relating or belonging to the Company, whether prepared by the Executive or otherwise coming into his possession in the course of his employment, is the exclusive property of the Company. Executive represents that he has delivered to the Company all such Confidential Information and Company property, and has not retained any Confidential Information or Company property (including, without limitations, any copies thereof). However, nothing in this Agreement or elsewhere shall preclude the Executive from retaining, and using appropriately, his rolodex (and electronic equivalents) or documents relating to his personal entitlements and obligations.

 

(e)                                  Enforcement. The Executive and the Company each acknowledge that a breach of his/its covenants contained in this Section 6 may cause irreparable damage to the other party, the exact amount of which would be difficult to ascertain, and that the remedies at law for any such breach or threatened breach would be inadequate. Accordingly, each party agrees that if he/it breaches or threatens to breach any of the covenants contained in this Section 6, in addition to any other remedy which may be available at law or in equity, the other party shall be entitled to specific performance and injunctive relief to prevent the breach or any threatened breach thereof without bond or other security or a showing that monetary damages will not provide an adequate remedy.

 

(f)                                   Scope of Covenants. The Company and the Executive further acknowledge that the time, scope, geographic area and other provisions of this Section 6 have been specifically negotiated by sophisticated commercial parties and agree that all such provisions are reasonable under the circumstances of the activities contemplated by this Separation Agreement. In the event that the agreements in this Section 6 shall be determined by any court of competent jurisdiction to be unenforceable by reason of their extending for too great a period of time or over too great a geographical area or by reason of their being too extensive in any other respect, they shall be interpreted to and/or over the maximum geographical area as to which they may be enforceable and/or to the maximum extent in all other respects as to which they may be enforceable, all as determined by such court in such action.

 

7.                                      Complete Agreement. Company and Executive agree that this Separation Agreement sets forth all of the promises and agreements between them with respect to the subject matter described herein and supersedes all prior and contemporaneous agreements, understandings, inducements or conditions, expressed or implied, oral or written, except as herein contained, with respect to the subject matter described herein. In the event of Executive’s death or a judicial determination of his incapacity, references to the Executive in this Agreement shall be deemed, as appropriate, to be references to his heirs, beneficiaries, estate, executor(s) or other legal representative(s).

 

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8.                                      Cooperation. Executive agrees that upon written request of the Company, he will make himself reasonably available to cooperate with the Company, its subsidiaries and affiliates and any of their officers, directors, shareholders, or employees in connection with any investigation or review by the Company or any federal, state or local regulatory, quasi-regulatory or self-governing authority as any such investigation or review relates to events or occurrences that transpired while Executive was employed by the Company and in respect of which Executive has knowledge (collectively, “Cooperation”). Executive’s Cooperation may include, but not be limited to, being available to meet with directors, officers or employees of the Company and/or the Company’s counsel at mutually convenient times and locations, executing accurate and truthful documents and taking such other actions as may reasonably be requested by the Company and/or the Company’s counsel to effectuate the foregoing. Departing Employee shall be entitled to reimbursement, upon receipt by the Company of suitable documentation, for his reasonable out-of-pocket travel and lodging expenses for such Cooperation.

 

9.                                      Changes to the Agreement. This Separation Agreement may not be amended or modified unless such amendments or modifications are in writing and signed by Departing Employee and an authorized representative of the Company.

 

10.                               Remedies. If Executive commits a material breach of any of Executive’s obligations under this Separation Agreement, in addition to any other legal or equitable remedies it may have for such breach, including the remedies in Section 6(f) above, the Company shall be entitled to its attorneys’ fees incurred due to such breach and shall have the right to terminate and recover the payments and benefits provided to Executive under this Separation Agreement. The termination or recovery of such payments or benefits in the event of Executive’s breach will not affect Executive’s continuing obligations under this Separation Agreement. Notwithstanding the foregoing, this Section 10 will not apply if Executive files a claim seeking to invalidate the validity of this Separation Agreement under the ADEA for failure to provide sufficient time for review and revocation as required under this law. For the avoidance of doubt, any filing or assertion of any claim in violation of Section 5 or any other provision of this Separation Agreement shall constitute a breach for purposes of this Section.

 

11.                               Applicable Law. This Agreement shall in all respects, including all matters of construction, validity and performance, be governed by, and construed and enforced in accordance with, the laws of the State of New York, without regard to any rules governing conflicts of laws.

 

12.                               Jurisdiction. The Executive and the Company each consents to jurisdiction in the United States District Court for the Southern District of New York, or if that court is unable to exercise jurisdiction for any reason, the Supreme Court of the State of New York, New York County, for any suits, claims or actions concerning this Separation Agreement and each waives any other requirement (whether imposed by statute, rule of court, or otherwise) with respect to personal jurisdiction or service of process and waives any objection to jurisdiction based on improper venue or improper jurisdiction.

 

13.                               Severability. If any provision of this Separation Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision of this Separation Agreement or any action in any other jurisdiction, but this Separation Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

14.                               No Waiver. No delay or failure by any party hereto in exercising, protecting, or enforcing any of its rights, titles, interests, or remedies hereunder, and no course of dealing or performance with respect thereto, shall constitute a waiver thereof. The express waiver by a party hereto of any right, title, interest, or remedy in a particular instance or circumstance shall not constitute a waiver thereof in any other instance or circumstance. All rights and remedies shall be cumulative and not exclusive of any other rights or remedies.

 

15.                               Counterparts. This Separation Agreement may be executed in any number of counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute one and the same instrument. Signatures delivered by facsimile (including, without limitation, by “pdf”) shall be effective for all purposes.

 

[signature page follows]

 

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IN WITNESS WHEREOF, the parties have executed and entered into this Agreement effective as of the Effective Date.

 

 

	
 
    	
EXECUTIVE
    
	
 
    	
 
    
	
 
    	
/s/ Stewart P. Skelly
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
WARREN RESOURCES, INC.
    
	
 
    	
 
    
	
 
    	
By
    	
/s/ Saema Somalya
    
	
 
    	
 
    	
Name: Saema Somalya
    
	
 
    	
 
    	
Title: Senior Vice   President, General Counsel & Corporate
    
	
 
    	
 
    	
Secretary
    

 

6Form of Medium-Term Notes, Series 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. 94986RC66 
	
FACE AMOUNT: $                   
          

 REGISTERED NO. ___ 

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES K 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the 

iShares® MSCI Emerging Markets ETF 

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 Cash
Settlement Amount (as defined below), in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, on the Stated Maturity Date. The “Stated Maturity
Date” shall be January 3, 2018. If the Determination Date (as defined below) is postponed, the Stated Maturity Date will be postponed to the third Business Day (as defined below) after the Determination Date as postponed. This Security
shall not bear any interest. 
 Any payments on this Security at Maturity will be made against presentation of this Security
at the office or agency of the Company maintained for that purpose in the City of Minneapolis, Minnesota and at any other office or agency maintained by the Company for such purpose. 

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

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

 

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

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

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

The “Underlier” shall mean the iShares MSCI Emerging Markets ETF. 

The “Trade Date” shall mean December 28, 2015. 

The “Initial Underlier Level” is $32.77, the Fund Closing Price of the Underlier on the Trade Date. 

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

The “Underlier Return” will be the quotient of (i) the Final Underlier Level minus the Initial Underlier
Level divided by (ii) the Initial Underlier Level, expressed as a percentage. 
 The “Maximum Settlement
Amount” is 118.50% of the Face Amount of this Security. 
 The “Threshold Level” is $29.493, which
is equal to 90.0% of the Initial Underlier Level. 
 The “Threshold Amount” is 10.0%. 

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

The “Fund Closing Price” with respect to the Underlier on any Trading Day means the product of (i) the
Closing Price of one share of the Underlier (or one unit of any other security for which a Fund Closing Price must be determined) on such Trading Day and (ii) the Adjustment Factor on such Trading Day. 

The “Closing Price” with respect to a share of the Underlier (or one unit of any other security for which a
Closing Price must be determined) on any Trading Day means the price, at the scheduled weekday closing time, without regard to after hours or any other trading outside the regular trading session hours, of the share on the principal United States
securities exchange registered under the Securities Exchange Act of 1934, as amended, on which the share (or any such other security) is listed or admitted to trading. 

The “Adjustment Factor” means, with respect to a share of the Underlier (or one unit of any other security
for which a Fund Closing Price must be determined), 1.0, subject to adjustment in the event of certain events affecting the shares of the Underlier. See “—Anti-dilution Adjustments Relating to the Underlier; Alternate Calculation
—Anti-dilution Adjustments” below. 

  
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 The “Underlying Index” shall mean the MSCI Emerging Markets
Index. 
 “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. 
 A
“Trading Day” means a day, as determined by the Calculation Agent, on which the Relevant Stock Exchange (as defined below) and each Related Futures or Options Exchange (as defined below) with respect to the Underlier, or any
successor thereto, if applicable, are scheduled to be open for trading for their respective regular trading sessions. 
 The
“Relevant Stock Exchange” for the Underlier means the primary exchange or quotation system on which shares (or other applicable securities) of the Underlier are traded, as determined by the Calculation Agent. 

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

The “Determination Date” shall be December 28, 2017. If the originally scheduled Determination Date is
not a Trading Day, the Determination Date shall be postponed to the next succeeding Trading Day. The Determination Date is also subject to postponement due to the occurrence of a Market Disruption Event. If a Market Disruption Event occurs or is
continuing with respect to the Underlier on the Determination Date, such Determination Date will be postponed to the first succeeding Trading Day on which a Market Disruption Event has not occurred and is not continuing; however, if such first
succeeding Trading Day has not occurred as of the eighth Trading Day after the originally scheduled Determination Date, that eighth Trading Day shall be deemed to be the Determination Date. If the Determination Date has been postponed eight Trading
Days after the originally scheduled Determination Date and a Market Disruption Event occurs or is continuing with respect to the Underlier on such eighth Trading Day, the Calculation Agent will determine the Closing Price of the Underlier on such
eighth Trading Day based on its good faith estimate of the value of the shares (or other applicable securities) of the Underlier as of the Close of Trading (as defined below) on such eighth Trading Day. See “—Market Disruption
Events.” 
 “Calculation Agent Agreement” shall mean the Calculation Agent Agreement dated as of
March 18, 2015 between the Company and the Calculation Agent, as amended from time to time. 
 “Calculation
Agent” shall mean the Person that has entered into the Calculation Agent Agreement with the Company providing for, among other things, the determination of the Final Underlier Level and the Cash Settlement Amount, which term shall, unless
the context otherwise requires, include its successors under such Calculation Agent Agreement. The initial Calculation Agent shall be Wells Fargo Securities, LLC. Pursuant to the Calculation Agent Agreement, the Company may appoint a different
Calculation Agent from time to time after the initial issuance of this Security without the consent of the Holder of this Security and without notifying the Holder of this Security. 

  
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 Market Disruption Events 

A “Market Disruption Event” means any of the following events as determined by the Calculation Agent in its
sole discretion: 
  

	 	(A)	 The occurrence or existence of a material suspension of or limitation imposed on trading by the Relevant Stock Exchange or otherwise relating to
the shares (or other applicable securities) of the Underlier or any Successor Underlier (as defined below) on the Relevant Stock Exchange at any time during the one-hour period that ends at the Close of Trading on such day, whether by reason of
movements in price exceeding limits permitted by such Relevant Stock Exchange or otherwise. 

  

	 	(B)	 The occurrence or existence of a material suspension of or limitation imposed on trading by any Related Futures or Options Exchange or otherwise in
futures or options contracts relating to the shares (or other applicable securities) of the Underlier or any Successor Underlier on any Related Futures or Options Exchange at any time during the one-hour period that ends at the Close of Trading on
that day, whether by reason of movements in price exceeding limits permitted by the Related Futures or Options Exchange or otherwise. 

  

	 	(C)	 The occurrence or existence of any event, other than an early closure, that materially disrupts or impairs the ability of market participants in
general to effect transactions in, or obtain market values for, shares (or other applicable securities) of the Underlier or any Successor Underlier on the Relevant Stock Exchange at any time during the one-hour period that ends at the Close of
Trading on that day. 

  

	 	(D)	 The occurrence or existence of any event, other than an early closure, that materially disrupts or impairs the ability of market participants in
general to effect transactions in, or obtain market values for, futures or options contracts relating to shares (or other applicable securities) of the Underlier or any Successor Underlier on any Related Futures or Options Exchange at any time
during the one-hour period that ends at the Close of Trading on that day. 

  

	 	(E)	 The closure of the Relevant Stock Exchange or any Related Futures or Options Exchange with respect to the Underlier or any Successor Underlier
prior to its Scheduled Closing Time unless the earlier closing time is announced by the Relevant Stock Exchange or Related Futures or Options Exchange, as applicable, at least one hour prior to the earlier of (1) the actual closing time for the
regular trading session on such Relevant Stock Exchange or Related Futures or Options Exchange, as applicable, and (2) the submission deadline for orders to be entered into the Relevant Stock Exchange or Related Futures or Options Exchange, as
applicable, system for execution at the Close of Trading on that day. 

  

	 	(F)	 The Relevant Stock Exchange or any Related Futures or Options Exchange with respect to the Underlier or any Successor Underlier fails to open for
trading during its regular trading session. 

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

	 	(1)	 “Close of Trading” means the Scheduled Closing Time of the Relevant Stock Exchange with respect to the Underlier or any Successor
Underlier; and 

  

	 	(2)	 the “Scheduled Closing Time” of the Relevant Stock Exchange or any Related Futures or Options Exchange on any Trading Day for the
Underlier or any Successor Underlier means the scheduled weekday closing time of such Relevant Stock Exchange or Related Futures or Options Exchange on such Trading Day, without regard to after hours or any other trading outside the regular trading
session hours. 

 Anti-dilution Adjustments Relating to the Underlier; Alternate Calculation 

Anti-dilution Adjustments 

The Calculation Agent will adjust the Adjustment Factor with respect to the Underlier as specified below if any of the events
specified below occurs with respect to the Underlier and the effective date or ex-dividend date, as applicable, for such event is after the Trade Date and on or prior to the Determination Date. 

The adjustments specified below do not cover all events that could affect the Underlier. The Calculation Agent may, in its
sole discretion, make additional adjustments to any terms of this Security upon the occurrence of other events that affect or could potentially affect the market price of, or shareholder rights in, the Underlier, with a view to offsetting, to the
extent practical, any such change, and preserving the relative investment risks of this Security. In addition, the Calculation Agent may, in its sole discretion, make adjustments or a series of adjustments that differ from those described herein if
the Calculation Agent determines that such adjustments do not properly reflect the economic consequences of the events specified herein or would not preserve the relative investment risks of this Security. All determinations made by the Calculation
Agent in making any adjustments to the terms of this Security, including adjustments that are in addition to, or that differ from, those described herein, will be made in good faith and a commercially reasonable manner, with the aim of ensuring an
equitable result. In determining whether to make any adjustment to the terms of this Security, the Calculation Agent may consider any adjustment made by the Options Clearing Corporation or any other equity derivatives clearing organization on
options contracts on the Underlier. 
     For any event described below, the Calculation Agent will not
be required to adjust the Adjustment Factor unless the adjustment would result in a change to the Adjustment Factor then in effect of at least 0.10%. The Adjustment Factor resulting from any adjustment will be rounded up or down, as appropriate, to
the nearest one-hundred thousandth. 
  

	 	(A)	 Stock Splits and Reverse Stock Splits 

  

	 	    	 If a stock split or reverse stock split has occurred, then once such split has become effective, the Adjustment Factor will be adjusted to equal
the product of the prior Adjustment Factor and the number of securities which a holder of one share (or other applicable security) of the Underlier before the effective date of 

  
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such stock split or reverse stock split would have owned or been entitled to receive immediately following the applicable effective date. 

 

	 	(B)	 Stock Dividends 

  

	 	    	 If a dividend or distribution of shares (or other applicable securities) to which this Security is linked has been made by the Underlier ratably to
all holders of record of such shares (or other applicable security), then the Adjustment Factor will be adjusted on the ex-dividend date to equal the prior Adjustment Factor plus the product of the prior Adjustment Factor and the number of shares
(or other applicable security) of the Underlier which a holder of one share (or other applicable security) of the Underlier before the ex-dividend date would have owned or been entitled to receive immediately following that date; provided, however,
that no adjustment will be made for a distribution for which the number of securities of the Underlier paid or distributed is based on a fixed cash equivalent value. 

 

	 	(C)	 Extraordinary Dividends 

  

	 	    	 If an Extraordinary Dividend (as defined below) has occurred, then the Adjustment Factor will be adjusted on the ex-dividend date to equal the
product of the prior Adjustment Factor and a fraction, the numerator of which is the Closing Price per share (or other applicable security) of the Underlier on the Trading Day preceding the ex-dividend date, and the denominator of which is the
amount by which the Closing Price per share (or other applicable security) of the Underlier on the Trading Day preceding the ex-dividend date exceeds the Extraordinary Dividend Amount (as defined below). 

 

	 	    	 For purposes of determining whether an Extraordinary Dividend has occurred: 

 

	 	(1)	 “Extraordinary Dividend” means any cash dividend or distribution (or portion thereof) that the Calculation Agent determines, in
its sole discretion, is extraordinary or special; and 

  

	 	(2)	 “Extraordinary Dividend Amount” with respect to an Extraordinary Dividend for the securities of the Underlier will equal the
amount per share (or other applicable security) of the Underlier of the applicable cash dividend or distribution that is attributable to the Extraordinary Dividend, as determined by the Calculation Agent in its sole discretion.

  

	 	    	 A distribution on the securities of the Underlier described below under the section entitled “—Reorganization Events” below that
also constitutes an Extraordinary Dividend will only cause an adjustment pursuant to that “—Reorganization Events” section. 

  
 6 

	 	(D)	 Other Distributions 

  

	 	    	 If the Underlier declares or makes a distribution to all holders of the shares (or other applicable security) of the Underlier of any non-cash
assets, excluding dividends or distributions described under the section entitled “—Stock Dividends” above, then the Calculation Agent may, in its sole discretion, make such adjustment (if any) to the Adjustment Factor as it deems
appropriate in the circumstances. If the Calculation Agent determines to make an adjustment pursuant to this paragraph, it will do so with a view to offsetting, to the extent practical, any change in the economic position of a holder of this
Security that results solely from the applicable event. 

  

	 	(E)	 Reorganization Events 

  

	 	    	 If the Underlier, or any Successor Underlier, is subject to a merger, combination, consolidation or statutory exchange of securities with another
exchange traded fund, and the Underlier is not the surviving entity (a “Reorganization Event”), then, on or after the date of such event, the Calculation Agent shall, in its sole discretion, make an adjustment to the Adjustment
Factor or the method of determining the Cash Settlement Amount or any other terms of this Security as the Calculation Agent determines appropriate to account for the economic effect on this Security of such event, and determine the effective date of
that adjustment. If the Calculation Agent determines that no adjustment that it could make will produce a commercially reasonable result, then the Calculation Agent may deem such event a Liquidation Event (as defined below). 

Liquidation Events 

If the Underlier is de-listed, liquidated or otherwise terminated (a “Liquidation Event”), and a successor or
substitute exchange traded fund exists that the Calculation Agent determines, in its sole discretion, to be comparable to the Underlier, then, upon the Calculation Agent’s notification of that determination to the Trustee and the Company, any
subsequent Fund Closing Price for the Underlier will be determined by reference to the Fund Closing Price of such successor or substitute exchange traded fund (such exchange traded fund being referred to herein as a “Successor
Underlier”), with such adjustments as the Calculation Agent determines are appropriate to account for the economic effect of such substitution on the holder of this Security. 

If the Underlier undergoes a Liquidation Event prior to, and such Liquidation Event is continuing on, the date that any Fund
Closing Price of the Underlier is to be determined and the Calculation Agent determines that no Successor Underlier is available at such time, then the Calculation Agent will, in its discretion, calculate the Fund Closing Price for the Underlier on
such date by a computation methodology that the Calculation Agent determines will as closely as reasonably possible replicate the Underlier, provided that if the Calculation Agent determines in its discretion that it is not practicable to replicate
the Underlier (including but not limited to the instance in which the sponsor of the index underlying the Underlier discontinues publication of that index), then the Calculation Agent will calculate the Fund Closing Price for the Underlier in
accordance with the formula last used to calculate such Fund Closing Price before such 

  
 7 

 
Liquidation Event, but using only those securities that were held by the Underlier immediately prior to such Liquidation Event without any rebalancing or substitution of such securities following
such Liquidation Event. 
 If a Successor Underlier is selected or the Calculation Agent calculates the Fund Closing Price
as a substitute for the Underlier, such Successor Underlier or Fund Closing Price will be used as a substitute for the Underlier for all purposes, including for purposes of determining whether a Market Disruption Event exists. 

If any event is both a Reorganization Event and a Liquidation Event, such event will be treated as a Reorganization Event for
purposes of this Security unless the Calculation Agent makes the determination referenced in the last sentence of the section entitled “—Anti-dilution Adjustments—Reorganization Events” above. 

Alternate Calculation 

If at any time the method of calculating the Underlier or a Successor Underlier, or the Underlying Index, is changed in a
material respect, or if the Underlier or a Successor Underlier is in any other way modified so that the Underlier does not, in the opinion of the Calculation Agent, fairly represent the price of the securities of the Underlier or such Successor
Underlier had such changes or modifications not been made, then the Calculation Agent may, at the close of business in New York City on the date that any Fund Closing Price is to be determined, make such calculations and adjustments as, in the good
faith judgment of the Calculation Agent, may be necessary in order to arrive at a Closing Price of an exchange traded fund comparable to the Underlier or such Successor Underlier, as the case may be, as if such changes or modifications had not been
made, and calculate the Fund Closing Price and the Cash Settlement Amount with reference to such adjusted Closing Price of the Underlier or such Successor Underlier, as applicable. 

Calculation Agent 

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

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

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

  
 8 

 Tax Considerations 

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

This Security is not subject to redemption at the option of the Company or repayment at the option of the Holder hereof prior
to January 3, 2018. This Security is not entitled to any sinking fund. 
 Acceleration 

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

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place. 
 Unless the certificate of authentication
hereon has been executed by the Trustee referred to on the reverse hereof by manual signature or its duly authorized agent under the Indenture referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose. 
 [The remainder of this page has been left intentionally blank] 

  
 9 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
under its corporate seal. 
 DATED:
                                 

 

					
	WELLS FARGO & COMPANY
		
	By:	 	 
		 	 
		 	Its:	 	 

 [SEAL] 
  

					
	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

  
 10 

 [Reverse of Note] 

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES K 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the iShares® MSCI 

Emerging Markets ETF 

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 July 21, 1999, 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 K, of the Company, which series is limited to an aggregate principal amount or face amount, as applicable, of $25,000,000,000 or the equivalent thereof in one or more
foreign or composite currencies. 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. 

Article Sixteen of the Indenture shall not apply to this Security. 

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 

  
 11 

 
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. 
 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 and certain Events of Default, 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 Securities Exchange Act of 1934, as amended, and a successor depositary is not
appointed within 90 days after the Company receives such notice or becomes aware of such ineligibility, (y) the Company in its sole discretion determines that this Security shall be exchangeable for definitive Securities in registered form
and notifies the Trustee thereof or (z) an Event of Default with respect to the Securities represented hereby has occurred and is continuing. If this Security is exchangeable pursuant to the preceding sentence, it shall be exchangeable for
definitive Securities in registered 

  
 12 

 
form, having the same date of issuance, Stated Maturity Date and other terms and of authorized denominations aggregating a like amount. 

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

Prior to due presentment of this Security for registration of transfer, the Company, the 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 Cash Settlement Amount at the times, place and rate, and in the coin or currency, herein prescribed, except as otherwise provided in this Security. 

No Personal Recourse 

No recourse shall be had for the payment of the Cash Settlement Amount, or for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or any successor corporation, 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. 

  
 13 

 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)

  
 14 

 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. 

  
 15

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