The information in this pricing supplement is not complete and may be changed. This pricing supplement is not an
offer to sell nor does it seek an offer to buy these Notes in any jurisdiction where the offer or sale is not permitted.
Subject to Completion, Dated May 20, 2019.
|
Pricing Supplement dated , 2019 to the
Product Prospectus Supplement MLN-ES-ETF-1 dated July 8, 2016 and
Prospectus Dated June 30, 2016
|
Filed Pursuant to Rule 424(b)(2)
Registration Statement No. 333-211718
|
 |
The Toronto-Dominion Bank
$
Capped Buffered Return Notes Linked to the Common Stock of Arista
Networks, Inc. Due on or about June 10, 2020
Senior Debt Securities, Series E
|
|
General
| • |
The Notes are designed for investors who (i) seek unleveraged exposure to a limited range of the percentage appreciation of the Common Stock of Arista Networks, Inc. (the “Reference Asset”) during the term of the Notes, (ii) are willing to accept the risk of losing some or all of their principal amount and (iii) are willing to
forgo interest and dividend payments.
|
| • |
Investors will receive their Principal Amount at maturity if the arithmetic average of the Closing Price of the Reference Asset on each Averaging Date (the “Final Price”) is less
than the Initial Price by up to 25%. If the Final Price is less than the Initial Price by more than 25%, investors will lose approximately 1.3333% of the Principal Amount of the Notes for each 1% decrease from the Initial Price to the
Final Price of more than 25%, and may lose their entire Principal Amount of the Notes.
|
| • |
Any payments on the Notes, including any repayment of principal, are subject to our credit risk.
|
Key Terms
|
Issuer:
|
The Toronto-Dominion Bank (“TD”)
|
|
Reference Asset:
|
The Common Stock of Arista Networks, Inc. (Bloomberg ticker: ANET)
|
|
Principal Amount:
|
$1,000 per Note, subject to a minimum investment of $10,000 and integral multiples of $1,000 in excess thereof.
|
|
Term:
|
Approximately 12.5 months
|
|
Pricing Date:
|
Expected to be May 24, 2019
|
|
Issue Date:
|
Expected to be May 30, 2019, which is three Business Days following the Pricing Date. See “Supplemental Plan of Distribution (Conflicts
of Interest)” herein.
|
|
Maturity Date:
|
Expected to be June 10, 2020, subject to postponement as described further
under “Additional Terms — Market Disruption Events”. If such day is not a Business Day, the Maturity Date will be the next succeeding Business Day.
|
|
Payment at Maturity:
|
On the Maturity Date, we will pay a cash payment, if anything, per Note equal to:
• If the Percentage Change is positive: Principal Amount + (Principal Amount x Percentage Change), subject to the
Maximum Return
• If the Percentage Change is less than or equal to 0%, but not by more than the Buffer Amount (that is, the
Percentage Change is between 0% and -25%): the Principal Amount of $1,000.
• If the Percentage Change is negative by more than the Buffer Amount (that is, the Percentage Change is between
-25% and -100%): Principal Amount + [Principal Amount x (Percentage Change + Buffer Amount) x Downside Leverage Factor]
If the Final Price is less than the Buffer Price, the investor will receive less than the Principal Amount of the
Notes at maturity and may lose some or all of their investment in the Notes. Any payments on the Notes are subject to our credit risk. All amounts used in or resulting from any
calculation relating to the Notes, including the Payment at Maturity, will be rounded upward or downward as appropriate, to the nearest cent.
|
|
Percentage Change:
|
The quotient, expressed as a percentage, of the following formula:
Final Price – Initial Price
Initial Price
|
|
Buffer Amount:
|
25.00%, which is equal to the amount, expressed in percentage terms, by which the Buffer Price is less than the Initial Price
|
|
Downside Leverage
Factor:
|
Approximately 1.3333, which is equal to the quotient of 1 /
(1 – Buffer Amount)
|
|
Maximum Return:
|
21.20%. Accordingly, if the Percentage Change is equal to or greater than 21.20%, you will receive the Maximum Return of 21.20%, which
entitles you to a maximum payment at maturity of $1,212.00 per $1,000 Principal Amount of the Notes.
|
|
Initial Price:
|
The Closing Price of the Reference Asset on the Pricing Date, as determined by the Calculation Agent and as subject to adjustment as
described under “General Terms of the Notes— Anti-Dilution Adjustments” in the product prospectus supplement and “Additional Terms—Anti-Dilution Adjustments” herein.
|
|
Final Price:
|
The arithmetic average of the Closing Price of the Reference Asset on each of the “Averaging Dates” specified below, as determined by
the Calculation Agent.
|
|
Averaging Dates:
|
Expected to be June 1, 2020, June 2, 2020, June 3, 2020, June 4, 2020 and June 5, 2020 (such day may be referred to as the “Final
Averaging Date”). In the event that we make any change to the expected Pricing Date and Issue Date, the Calculation Agent may adjust each Averaging Date and the Maturity Date to ensure that the stated term of the Notes remains the same.
Each “Averaging Date” is a “Valuation Date” for the purposes of the product prospectus supplement and is subject to postponement as described under “Additional Terms—Market Disruption Events” herein. If such day is not a Trading Day, the
relevant Averaging Date will be the next succeeding Valid Day as described under “Additional Terms—Market Disruption Events” herein.
|
|
Buffer Price:
|
75.00% of the Initial Price (to be determined on the Pricing Date), as determined by the Calculation Agent and as subject to adjustment
as described under “General Terms of the Notes— Anti-Dilution Adjustments” in the product prospectus supplement and “Additional Terms—Anti-Dilution Adjustments” herein.
|
|
CUSIP / ISIN:
|
89114QT99 / US89114QT991
|
The estimated value of your Notes at the time the terms of your Notes are set on the Pricing Date is expected to be between $965.00 and $980.00 per Note, as discussed further under “Additional Risk Factors — Estimated Value” beginning on page P-4 and “Additional
Information Regarding the Estimated Value of the Notes” on page P-17 of this pricing supplement. The estimated value is expected to be less than the public offering price of the Notes.
The Notes are unsecured and are not savings accounts or insured deposits of a bank. The Notes are not insured or guaranteed by the Canada Deposit Insurance
Corporation, the U.S. Federal Deposit Insurance Corporation or any other governmental agency or instrumentality.The Notes will not be listed or displayed on any securities exchange or any electronic communications network.
The Notes have complex features and investing in the Notes involves a number of risks. See “Additional Risk Factors” beginning on page P-3 of
this pricing supplement, “Additional Risk Factors Specific to the Notes” beginning on page PS-5 of the product prospectus supplement MLN-ES-ETF-1 dated July 8, 2016, (the “product prospectus supplement”) and “Risk Factors” on page 1 of the
prospectus dated June 30, 2016 (the “prospectus”). Neither the Securities and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved of these Notes or determined that this pricing supplement, the product
prospectus supplement or the prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
|
Public Offering Price1
|
Underwriting Discount2
|
Proceeds to TD
|
|
|
Per Note
|
$1,000.00
|
$10.00
|
$990.00
|
|
Total
|
$
|
$
|
$
|
The public offering price, underwriting discount and proceeds to TD listed above relate to the Notes we issue initially. We may decide to sell
additional Notes after the date of the final pricing supplement, at public offering prices and with underwriting discounts and proceeds to TD that differ from the amounts set forth above. The return (whether positive or negative) on your
investment in the Notes will depend in part on the public offering price you pay for such Notes.
1 The public offering price for investors purchasing the Notes in fiduciary accounts may be as low as $990.00 (99.00%) per Note.
2 TD Securities (USA) LLC (“TDS” or the “Agent”) will receive a commission of $10.00 (1.00%) per $1,000.00 Principal Amount of the Notes sold in this
offering. J.P. Morgan Securities LLC, which we refer to as JPMS LLC, and JPMorgan Chase Bank, N.A. will act as placement agents for the Notes and, from the commission to TDS, will receive a placement fee of $10.00 for each Note they sell in this
offering to accounts other than fiduciary accounts. TDS and the placement agents will forgo a commission and placement fee for sales to fiduciary accounts. TD will reimburse TDS for certain expenses in connection with its role in the offer and
sale of the Notes, and TD will pay TDS a fee in connection with its role in the offer and sale of the Notes. See “Supplemental Plan of Distribution (Conflicts of Interest)” on page P-16 of this pricing supplement.
Additional Terms of Your Notes
You should read this preliminary pricing supplement (this “pricing supplement”) together with the prospectus, as supplemented by the product
prospectus supplement MLN-ES-ETF-1 (the “product prospectus supplement”), relating to our Senior Debt Securities, Series E, of which these Notes are a part. Capitalized terms used but not defined in this pricing supplement will have the meanings
given to them in the product prospectus supplement. In the event of any conflict the following hierarchy will govern: first, this pricing supplement; second, the product prospectus supplement; and last, the prospectus. The Notes vary from the terms described in the product prospectus supplement in several important ways. You should read this pricing supplement carefully.
This pricing supplement, together with the documents listed below, contains the terms of the Notes and supersedes all prior or contemporaneous oral
statements as well as any other written materials including preliminary or indicative pricing terms, correspondence, trade ideas, structures for implementation, sample structures, brochures or other educational materials of ours. You should
carefully consider, among other things, the matters set forth in “Additional Risk Factors” beginning on page P-3 of this pricing supplement, “Additional Risk Factors Specific to the Notes” beginning on page PS-5 of the product prospectus supplement
and “Risk Factors” on page 1 of the prospectus, as the Notes involve risks not associated with conventional debt securities. We urge you to consult your investment, legal, tax, accounting and other advisors before you invest in the Notes. You may
access these documents on the SEC website at www.sec.gov as follows (or if that address has changed, by reviewing our filings for the relevant date on the SEC website):
| ◾ |
Prospectus dated June 30, 2016:
|
| ◾ |
Product Prospectus Supplement MLN-ES-ETF-1 dated July 8, 2016:
|
Our Central Index Key, or CIK, on the SEC website is 0000947263. Alternatively, The Toronto-Dominion Bank, any Agent or any dealer participating in
this offering will arrange to send you the product prospectus supplement and the prospectus if you so request by calling 1-855-303-3234. As used in this pricing supplement, the “Bank,” “we,” “us,” or “our” refers to The Toronto-Dominion Bank and
its subsidiaries.
We reserve the right to change the terms of, or reject any offer to purchase, the Notes prior to their issuance. In the event of any changes to the terms of the Notes, we
will notify you and you will be asked to accept such changes in connection with your purchase. You may also choose to reject such changes, in which case we may reject your offer to purchase.
Selected Purchase Considerations
| • |
Potential for Unleveraged Exposure to Upside Appreciation, subject to the Maximum Return – The Notes provide
unleveraged exposure to a limited range of appreciation in the price of the Reference Asset over the term of the Notes. However, the opportunity to participate in the possible increases in the price of the Reference Asset through an
investment in the Notes is limited because the return on the Notes will not exceed the Maximum Return.
|
| • |
Contingent Repayment of Principal, with Potential for Full Downside Exposure – At maturity, if the Final
Price is greater than or equal to the Buffer Price and less than or equal to the Initial Price, investors will receive a cash payment per Note equal to the Principal Amount. If, however, the Final Price is less than the Buffer Price,
investors will lose approximately 1.3333% of the Principal Amount of the Notes for each 1% that the Final Price is less than the Initial Price in excess of the Buffer Amount and,
because of the Downside Leverage feature, may lose their entire investment in the Notes. Any payments on the Notes, including any repayment of principal, are subject
to our credit risk.
|
Additional Risk Factors
The Notes involve risks not associated with an investment in conventional debt securities. This section describes the most significant risks
relating to the terms of the Notes. For additional information as to these risks, please see “Additional Risk Factors Specific to the Notes” in the product prospectus supplement and the prospectus.
You should carefully consider whether the Notes are suited to your particular circumstances before you decide to purchase them. Accordingly, you
should consult your investment, legal, tax, accounting and other advisors as to the risks entailed by an investment in the Notes and the suitability of the Notes in light of your particular circumstances.
Your Investment in the Notes May Result in a Loss.
The Notes do not guarantee the return of the Principal Amount and investors may lose up to their entire investment in the Notes. Your investment
will be exposed to a loss on a leveraged basis if the Final Price is less than the Initial Price by more than the Buffer Amount. Specifically, if the Final Price is less than the Initial Price by more than the Buffer Amount, investors will lose
approximately 1.3333% of the Principal Amount of the Notes for each 1% that the Final Price is less than the Initial Price in excess of the Buffer Amount, and may lose their entire Principal Amount.
The Notes Do Not Pay Interest and Your Return May Be Lower than the Return on a Conventional Debt Security of Comparable
Maturity.
There will be no periodic interest payments on the Notes as there would be on a conventional fixed-rate or floating-rate debt security having a
comparable maturity. The return that you will receive on the Notes, which could be negative, may be less than the return you could earn on other investments. The Notes do not provide for interest payments. Even if your return is positive, your
return may be less than the return you would earn if you bought a conventional senior interest bearing debt security of TD with the same maturity date or if you invested directly in the Reference Asset. Your investment may not reflect the full
opportunity cost to you when you take into account factors that affect the time value of money.
Your Potential Return Will be Limited by the Maximum Return and May be Lower Than the Return on a Direct Investment in the
Reference Asset.
The opportunity to participate in the possible increases in the price of the Reference Asset through an investment in the Notes will be limited
because the return on the Notes will not exceed the Maximum Return. Therefore, you will not benefit from any positive Percentage Change that exceeds the Maximum Return, regardless of how much the Reference Asset appreciates. Accordingly, your
return on the Notes may be less than your return would be if you made an investment in the Reference Asset or a security directly linked to the performance of the Reference Asset.
The Amount Payable on the Notes, if Any, is not Linked to the Price of the Reference Asset at any Time Other than the Averaging
Dates.
Any payment on the Notes will be based on the Final Price, which will be the arithmetic average of the Closing Price of the Reference Asset on each
of the Averaging Dates (including the Final Averaging Date). Even if the price of the Reference Asset appreciates prior to the Averaging Dates but then declines by the Averaging Dates, the Payment at Maturity, if any, may be significantly less than
it would have been had the Payment at Maturity been linked to the price of the Reference Asset prior to such decline. Although the Closing Price of the Reference Asset on the Final Averaging Date or at other times during the term of the Notes may
be higher than the Final Price, the Payment at Maturity, if any, will be based solely on the arithmetic average of the Closing Price of the Reference Asset on each of the Averaging Dates as compared to the Initial Price.
The Amount Payable on the Notes, if Any, is Based on the Arithmetic Average of the Closing Price of the Reference Asset on each
of the Averaging Dates, and therefore the Payment at Maturity, if Any, may be less than if it were Based Solely on the Closing Price of the Reference Asset on a Single Valuation Date.
The Payment at Maturity, if any, will be calculated by reference to the Final Price, which will be equal to the arithmetic average of the Closing Price of the Reference
Asset each of the Averaging Dates listed herein. Therefore, in calculating the Final Price, positive
performance of the Reference Asset on one or more Averaging Dates that would lead to a positive return on the Notes may be moderated, wholly offset
or even reversed by changes in the price of the Reference Asset on one or more of the other Averaging Dates.
Investors Are Subject to TD’s Credit Risk, and TD’s Credit Ratings and Credit Spreads May Adversely Affect the Market Value of
the Notes.
Although the return on the Notes will be based on the performance of the Reference Asset, the payment of any amount due on the Notes is subject to
TD’s credit risk. The Notes are TD’s senior unsecured debt obligations. Investors are dependent on TD’s ability to pay all amounts due on the Notes on the Maturity Date and, therefore, investors are subject to the credit risk of TD and to changes
in the market’s view of TD’s creditworthiness. Any decrease in TD’s credit ratings or increase in the credit spreads charged by the market for taking TD’s credit risk is likely to adversely affect the market value of the Notes. If TD becomes unable
to meet its financial obligations as they become due, investors may not receive any amounts due under the terms of the Notes.
Notwithstanding Anything to the Contrary Set Forth in the Prospectus, the Indenture Will Provide Only Limited Acceleration and
Enforcement Rights for the Notes.
In connection with the implementation of certain Canadian federal statutes, and notwithstanding anything to the contrary set forth in the
prospectus, the indenture under which the Notes are issued has been supplemented to provide that, for any Notes of a series issued on or after September 23, 2018, including the Notes offered by this pricing supplement, acceleration will only be
permitted if (i) we default in the payment of the principal of, or interest on, any note of that series and, in each case, the default continues for a period of 30 Business Days, or (ii) certain bankruptcy, insolvency or reorganization events
occur. As a result, before you invest in the Notes, you should consider the risk that your safeguards and your ability to effect remedies under the indenture will be limited. See “Events of Default” herein for additional information.
The Agent Discount, Offering Expenses and Certain Hedging Costs Are Likely to Adversely Affect Secondary Market Prices.
Assuming no changes in market conditions or any other relevant factors, the price, if any, at which you may be able to sell the Notes will likely be
lower than the public offering price. The public offering price includes, and any price quoted to you is likely to exclude, the underwriting discount paid in connection with the initial distribution, offering expenses as well as the cost of hedging
our obligations under the Notes. In addition, any such price is also likely to reflect dealer discounts, mark-ups and other transaction costs, such as a discount to account for costs associated with establishing or unwinding any related hedge
transaction.
There May Not Be an Active Trading Market for the Notes — Sales in the Secondary Market May Result in Significant Losses.
There may be little or no secondary market for the Notes. The Notes will not be listed or displayed on any securities exchange or any electronic
communications network. The Agent or another of our affiliates may make a market for the Notes; however, they are not required to do so and may stop any market-making activities at any time. Even if a secondary market for the Notes develops, it may
not provide significant liquidity or trade at prices advantageous to you. We expect that transaction costs in any secondary market would be high. As a result, the difference between bid and ask prices for your Notes in any secondary market could be
substantial. If you sell your Notes before the Maturity Date, you may have to do so at a substantial discount from the public offering price irrespective of the price of the Reference Asset at such time, and as a result, you may suffer substantial
losses.
If the Price of the Reference Asset Changes, the Market Value of Your Notes May Not Change in the Same Manner.
Your Notes may trade quite differently from the performance of the Reference Asset. Changes in the price of the Reference Asset may not result in a
comparable change in the market value of your Notes. Even if the price of the Reference Asset increases above the Initial Price during the term of the Notes, the market value of your Notes may not increase, and could decline.
There Are Single Stock Risks Associated with the Reference Asset.
The price of the Reference Asset can rise or fall sharply due to factors specific to the Reference Asset and
the issuer of the Reference Asset (the “Reference Asset Issuer”), such as stock price volatility, earnings, financial conditions, corporate, industry and regulatory developments, management changes and decisions and other events, as well as general
market factors, such as general stock market volatility and levels, interest rates and economic and political conditions. You, as an investor in the Notes, should make your own investigation into the Reference Asset Issuer and the Reference Asset
for your Notes. For additional information, see "Information Regarding the Reference Asset" in this pricing supplement and the Reference Asset Issuer's SEC filings. We urge you
to review financial and other information filed periodically by the Reference Asset Issuer with the SEC.
Estimated Value
The Estimated Value of Your Notes Is Expected To Be Lower Than the Public Offering Price of Your Notes.
The estimated value of your Notes on the Pricing Date is expected to be lower than the public offering price of your Notes. The
difference between the public offering price of your Notes and the estimated value of the Notes reflects costs and expected profits associated with selling and structuring the Notes, as well as hedging our obligations under the Notes. Because
hedging our obligations entails risks and may be influenced by market forces beyond our control, this hedging may result in a profit that is more or less than expected, or a loss.
The Estimated Value of Your Notes Is Based on Our Internal Funding Rate.
The estimated value of your Notes on the Pricing Date is determined by reference to our internal funding rate. The internal funding rate used
in the determination of the estimated value of the Notes generally represents a discount from the credit spreads for our conventional fixed-rate debt securities and the borrowing rate we would pay for our conventional fixed-rate debt securities.
This
discount is based on, among other things, our view of the funding value of the Notes as well as the higher issuance, operational
and ongoing liability management costs of the Notes in comparison to those costs for our conventional fixed-rate debt, as well as estimated financing costs of any hedge positions, taking into account regulatory and internal requirements. If the
interest rate implied by the credit spreads for our conventional fixed-rate debt securities, or the borrowing rate we would pay for our conventional fixed-rate debt securities were to be used, we would expect the economic terms of the Notes to be
more favorable to you. Additionally, assuming all other economic terms are held constant, the use of an internal funding rate for the Notes is expected to increase the estimated value of the Notes at any time.
The Estimated Value of the Notes Is Based on Our Internal
Pricing Models, Which May Prove to Be Inaccurate and May Be Different from the Pricing Models of Other Financial Institutions.
The estimated value of your Notes on the Pricing Date is based on our internal pricing models when the terms of the Notes are
set, which take into account a number of variables, such as our internal funding rate on the Pricing Date, and are based on a number of subjective assumptions, which are not evaluated or verified on an independent basis and may or may not
materialize. Further, our pricing models may be different from other financial institutions’ pricing models and the methodologies used by us to estimate the value of the Notes may not be consistent with those of other financial institutions that
may be purchasers or sellers of Notes in the secondary market. As a result, the secondary market price of your Notes may be materially lower than the estimated value of the Notes determined by reference to our internal pricing models. In addition,
market conditions and other relevant factors in the future may change, and any assumptions may prove to be incorrect.
The Estimated Value of Your Notes Is Not a Prediction of the Prices at Which You May Sell Your Notes in the
Secondary Market, If Any, and Such Secondary Market Prices, If Any, Will Likely be Lower Than the Public Offering Price of Your Notes and May Be Lower Than the Estimated Value of Your Notes.
The estimated value of the Notes will not be a prediction of the prices at which the Agent, other affiliates of ours or third
parties may be willing to purchase the Notes from you in secondary market transactions (if they are willing to purchase, which they are not obligated to do). The price at which you may be able to sell your Notes in the secondary market at any time,
if any, will be influenced by many factors that cannot be predicted, such as market conditions, and any bid and ask spread for similar sized trades, and may be substantially less than the estimated value of the Notes. Further, as secondary market
prices of your Notes take into account the levels at which our debt securities trade in the secondary market, and do not take into account our various costs and expected profits associated with selling and structuring the Notes, as well as hedging
our obligations under the Notes, secondary market prices of your Notes will likely be lower than the public offering price of your Notes. As a result, the price at which the Agent, other affiliates of ours or third parties may be willing to
purchase the Notes from you in secondary market transactions, if any, will likely be lower than the price you paid for your Notes, and any sale prior to the Maturity Date could result in a substantial loss to you.
The Temporary Price at Which the Agent May Initially Buy the Notes in the Secondary Market May Not Be
Indicative of Future Prices of Your Notes.
Assuming that all relevant factors remain constant after the Pricing Date, the price at which the Agent may initially buy or sell
the Notes in the secondary market (if the Agent makes a market in the Notes, which it is not obligated to do) may exceed the estimated value of the Notes on the Pricing Date, as well as the secondary market value of the Notes, for a temporary
period after the Issue Date of the Notes, as discussed further under “Additional Information Regarding the Estimated Value of the Notes.” The price at which the Agent may initially buy or sell the Notes in the secondary market may not be indicative
of future prices of your Notes.
You Will Have No Rights to Receive Any Shares of the Reference Asset and You Will Not Be Entitled to Dividends or Other
Distributions by the Reference Asset.
The Notes are our debt securities. They are not equity instruments, shares of stock, or securities of any other issuer. Investing
in the Notes will not make you a holder of shares of the Reference Asset. Your return on the Notes is limited to the Maximum Return and you will not participate in any appreciation of the Reference Asset in excess of the Maximum Return even though,
if the Final Price is less than the Buffer Price, you are subject to its downside market risk. Additionally, you will not have any voting rights, any rights to receive dividends or other distributions, any rights against the Reference Asset Issuer.
As a result, the return on your Notes will not reflect the return you would realize if you actually owned shares of the Reference Asset, participated in the full appreciation of the Reference Asset and received the dividends paid or other
distributions made in connection with the Reference Asset. The amount you receive on the Maturity Date, if anything, will be paid in cash and you have no right to receive delivery of shares of the Reference Asset.
You Will Have Limited Anti-Dilution Protection.
The Calculation Agent will adjust the Initial Price and Buffer Price for stock splits, reverse stock splits, stock dividends, extraordinary
dividends and other events that affect the Reference Asset, but only in the situations we describe in “General Terms of the Notes—Anti-Dilution Adjustments” in the product prospectus supplement and “Anti-Dilution Adjustments” herein. The
Calculation Agent will not be required to make an adjustment for every event that may affect the Reference Asset. Those events or other actions by the Reference Asset Issuer or a third party may nevertheless adversely affect the price of the
Reference Asset, and adversely affect the market value of, and any amount payable on, your Notes.
We Do Not Control the Reference Asset Issuer and Are Not Responsible for Any of its Disclosure.
Neither we nor any of our affiliates have the ability to control the actions of the Reference Asset Issuer and have not conducted any independent review or due
diligence of any information related to the Reference Asset or Reference Asset Issuer. We are not responsible
for the Reference Asset Issuer public disclosure of information on itself or the Reference Asset, whether contained in Securities Exchange
Commission filings or otherwise. You should make your own investigation into the Reference Asset Issuer.
There Are Potential Conflicts of Interest Between You and the Calculation Agent.
The Calculation Agent will, among other things, determine the Payment at Maturity, if any, on the Notes. We will serve as the Calculation Agent and
may appoint a different Calculation Agent after the Issue Date without notice to you. The Calculation Agent will exercise its judgment when performing its functions and may take into consideration our ability to unwind any related hedges. Because
this discretion by the Calculation Agent may affect payments on the Notes, the Calculation Agent may have a conflict of interest if it needs to make any such decision. For example, the Calculation Agent may have to determine whether a Market
Disruption Event affecting the Reference Asset has occurred, and make certain adjustments to the Reference Asset if certain events occur. This determination may, in turn, depend on the Calculation Agent’s judgment whether the event has materially
interfered with our ability or the ability of one of our affiliates to unwind our hedge positions. Because this determination by the Calculation Agent will affect any payment on the Notes, the Calculation Agent may have a conflict of interest if it
needs to make a determination of this kind. For additional information as to the Calculation Agent’s role, see “General Terms of the Notes — Role of Calculation Agent” in the product prospectus supplement.
Any Averaging Date (including the Final Averaging Date) and the Maturity Date are Subject to Market Disruption Events and
Postponement.
Each Averaging Date (including the Final Averaging Date), and therefore the Maturity Date, are subject to postponement as described
herein and in the product prospectus supplement due to the occurrence of one or more Market Disruption Events. For a description of what constitutes a Market Disruption Event as well as the consequences of that Market Disruption Event, see
“Additional Terms — Market Disruption Events” herein and “General Terms of the Notes — Market Disruption Events” in the product prospectus supplement.
Trading and Business Activities by the Bank or its Affiliates May Adversely Affect the Market Value of the Notes.
We, the Agent and/or one or more of our other affiliates may hedge our obligations under the Notes by purchasing shares of the Reference Asset,
securities, futures, options or other derivative instruments with returns linked or related to changes in the price of the Reference Asset, and we may adjust these hedges by, among other things, purchasing or selling at any time shares of, or securities, futures, options or other derivative instruments on, the Reference Asset. It is possible that we and/or one or more of our affiliates could receive substantial returns from these
hedging activities while the market value of the Notes declines. We and/or one or more of our affiliates may also issue or underwrite other securities or financial or derivative instruments with returns linked or related to changes in the
performance of the Reference Asset.
These trading activities may present a conflict between the holders’ interest in the Notes and the interests we and/or our affiliates will have in
our or their proprietary accounts, in facilitating transactions, including options and other derivatives transactions, for our and/or their customers’ accounts and in accounts under our and/or their management. These trading activities could be
adverse to the interests of the holders of the Notes.
We, the Agent and/or another of our affiliates may, at present or in the future, engage in business with the Reference Asset Issuer, including
making loans to or providing advisory services to those companies. These services could include investment banking and merger and acquisition advisory services. These business activities may present a conflict between our and/or one or more of our
affiliates’ (including the Agent’s) obligations and your interests as a holder of the Notes. Moreover, we, the Agent and/or another of our affiliates may have published, and in the future expect to publish, research reports with respect to the
Reference Asset or the Reference Asset Issuer. This research is modified from time to time without notice and may express opinions or provide recommendations that are inconsistent with purchasing or holding the Notes. Any of these activities by us,
the Agent and/or another of our affiliates may affect the price of the Reference Asset and, therefore, the market value of, and any payment on, the Notes.
Significant Aspects of the Tax Treatment of the Notes Are Uncertain.
Significant aspects of the U.S. tax treatment of the Notes are uncertain. You should consult your tax advisor about your tax situation and should read
carefully the section entitled “Supplemental Discussion of U.S. Federal Income Tax Consequences” in the product prospectus supplement, and the section entitled “Supplemental Discussion of U.S. Federal Income Tax Consequences” below. You should
consult your tax advisor as to the tax consequences of your investment in the Notes.
For a discussion of the Canadian federal income tax consequences of investing in the Notes, please see the discussion in the product prospectus
supplement under “Supplemental Discussion of Canadian Tax Consequences.”
If you are not a Non-resident Holder (as that term is defined in the prospectus) for Canadian federal income tax purposes or if you acquire the Notes in the secondary
market, you should consult your tax advisors as to the consequences of acquiring, holding and disposing of the Notes and receiving the payments that might be due under the Notes.
|
Capped Buffered Return Notes
Linked to the Common Stock of Arista Networks, Inc.
Due on or about June 10, 2020
|
|
Additional Terms
The information in this “Additional Terms” section supplements, and to the extent inconsistent supersedes, the information set forth in the product
prospectus supplement and the prospectus.
|
Issue:
|
Senior Debt Securities, Series E
|
|
Type of Note:
|
Capped Buffered Return Notes
|
|
Agent:
|
TDS
|
|
Currency:
|
U.S. Dollars
|
|
Monitoring Period:
|
For purposes of determination of the Final Price, the Calculation Agent will observe the Closing Price on each Averaging Date.
|
|
Limited Events of Default:
|
Notwithstanding anything to the contrary set forth in the prospectus, the only events of default for the Notes will be (i) defaults in the
payment of principal or any interest, as applicable, that continue for 30 Business Days and (ii) certain bankruptcy, insolvency or reorganization events. No other breach or default under our indenture or the Notes will result in an event
of default for the Notes or permit the trustee or holders to accelerate the maturity of any debt securities – that is, they will not be entitled to declare the principal amount of any Notes to be immediately due and payable. See “Additional
Risk Factors — Notwithstanding Anything to the Contrary Set Forth in the Prospectus, the Indenture Will Provide Only Limited Acceleration and Enforcement Rights for the Notes”.
|
|
Business Day:
|
Any day that is a Monday, Tuesday, Wednesday, Thursday or Friday that is neither a legal holiday nor a day on which banking institutions are
authorized or required by law to close in New York City or Toronto.
|
|
Market Disruption Events:
|
If a Market Disruption Event occurs or is continuing on an Averaging Date (including the Final Averaging Date), the affected Averaging Date
will be postponed to the next Valid Date. A “Valid Date” is a Trading Day (1) on which no Market Disruption Event occurs or is continuing and (2) which is not otherwise scheduled to be an Averaging Date. If the first succeeding Valid Date
has not occurred as of the close of trading on the tenth Trading Day immediately following the original date such that, but for the occurrence of another Averaging Date or a Market Disruption Event, would have been the final Averaging Date,
then (1) that tenth Trading day shall be deemed to be the Averaging Date (irrespective of whether that tenth Trading Day is already an Averaging Date), and (2) the Calculation Agent shall determine the Closing Price on such day as specified
above. If the Calculation Agent postpones the determination of the Closing Price on an Averaging Date (and therefore postpones the determination of the Final Price), the Maturity Date will be postponed to maintain the same number of
Business Days between the final Averaging Date and the Maturity Date as existed prior to the postponement(s).
Each Averaging Date is a “Valuation Date” for purposes of the product prospectus supplement. See “General Terms of the Notes — Market Disruption Events” in the
product prospectus supplement for events that constitute a Market Disruption Event.
|
|
Capped Buffered Return Notes
Linked to the Common Stock of Arista Networks, Inc.
Due on or about June 10, 2020
|
|
|
Anti-Dilution Adjustments:
|
The section “General Terms of the Notes—Anti-Dilution Adjustments—Transferable Rights and Warrants” in the product prospectus supplement is
replaced in its entirety with the following:
Transferable Rights and Warrants
If the Reference Asset Issuer issues transferable rights or warrants to all holders of the Reference Asset to subscribe for or purchase the
Reference Asset at an exercise price per share that is less than the Closing Price of the Reference Asset on the Trading Day before the ex-dividend date for such issuance, then the Calculation Agent may adjust the Initial Price and/or Final
Price, as applicable, of the Reference Asset, or any other terms of the Notes as the Calculation Agent determines appropriate with reference to any adjustment(s) to options contracts on the affected Reference Asset in respect of such
issuance of transferable rights or warrants made by the Options Clearing Corporation, or any other equity derivatives clearing organization or exchange to account for the economic effect of such issuance.
|
|
Canadian Tax Treatment:
|
Please see the discussion in the product prospectus supplement under “Supplemental Discussion of Canadian Tax Consequences,” which applies
to the Notes.
|
|
Calculation Agent:
|
TD
|
|
Listing:
|
The Notes will not be listed or displayed on any securities exchange or electronic communications network.
|
|
Clearance and Settlement:
|
DTC global (including through its indirect participants Euroclear and Clearstream, Luxembourg as described under “Forms of the Debt
Securities” and “Book-Entry Procedures and Settlement” in the prospectus).
|
|
Canadian Bail-in:
|
The Notes are not bail-inable notes under the Canada Deposit Insurance Corporation Act.
|
Hypothetical Returns
The examples and table set out below are included for illustration purposes only and are hypothetical examples only: amounts below may have been
rounded for ease of analysis. The hypothetical Percentage Changes of the Reference Asset used to illustrate the calculation of the hypothetical Payment at Maturity
(rounded to two decimal places) are not estimates or forecasts of the Initial Price, the Final Price or the price of the Reference Asset on any Trading Day prior to the Maturity Date. All examples assume a Buffer Amount of 25.00% (the Buffer Price
is 75.00% of the Initial Price), a Maximum Return of 21.20%, a Downside Leverage Factor of approximately 1.3333 and that a holder purchased Notes with an aggregate Principal Amount of $1,000 and that no market disruption event occurs on any
Averaging Date, including the Final Averaging Date.
|
Example 1—
|
Calculation of the Payment at Maturity where the Percentage Change is positive and less than the Maximum Return.
|
|
|
Percentage Change:
|
10.00%
|
|
|
Payment at Maturity:
|
= $1,000.00 + ($1,000.00 x 10.00%), subject to the Maximum Return of 21.20%
= $1,000.00 + $100.00
= $1,100.00.
|
|
|
On a $1,000.00 investment, a 10.00% Percentage Change results in a Payment at Maturity of $1,100.00, a 10.00% return on the Notes.
|
||
|
Example 2—
|
Calculation of the Payment at Maturity where the Percentage Change is positive and the Payment at Maturity is subject to the Maximum Return.
|
|
|
Percentage Change:
|
30.00%
|
|
|
Payment at Maturity:
|
= $1,000.00 + ($1,000.00 x 30.00%), subject to the Maximum Return of 21.20%
= $1,000.00 + $210.00
= $1,212.00.
|
|
|
On a $1,000.00 investment, a 30.00% Percentage Change results in a Payment at Maturity of $1,212.00, a 21.20% return on the Notes.
|
||
|
Example 3—
|
Calculation of the Payment at Maturity where the Percentage Change is negative (but not by more than the Buffer Amount).
|
|
|
Percentage Change:
|
-10.00%
|
|
|
Payment at Maturity:
|
At maturity, if the Percentage Change is negative BUT not by more than the Buffer Amount, then the Payment at Maturity will equal the
Principal Amount.
|
|
|
On a $1,000.00 investment, a -10.00% Percentage Change results in a Payment at Maturity of $1,000.00,
a 0.00% return on the Notes.
|
||
|
Example 4—
|
Calculation of the Payment at Maturity where the Percentage Change is negative (by more than the Buffer Amount).
|
|
Percentage Change:
|
-40.00%
|
|
|
Payment at Maturity:
|
$1,000.00 + [$1,000.00 x (-40.00% + 25.00%) x (1 / 0.75)] = $1,000.00 - $200.00 = $800.00
|
|
|
On a $1,000.00 investment, a -40.00% Percentage Change results in a Payment at Maturity of $800.00, a
-20.00% return on the Notes.
|
||
The following table illustrates hypothetical payments per Note that could be realized at maturity for a range of hypothetical Closing Prices of the
Reference Asset.
The hypothetical payments set forth below are based on the hypothetical terms set forth above, and a hypothetical Initial Price of 100.00 and
hypothetical Final Prices shown below, which do not represent a likely Initial Price or likely Final Prices, respectively, of the Reference Asset. The hypothetical total returns set forth below are for illustrative purposes only and may not be the
actual total returns applicable to a purchaser of the Notes. The numbers appearing in the following table have been rounded for ease of analysis.
|
Hypothetical
Final Price*
|
Hypothetical
Percentage
Change
|
Payment at
Maturity
|
Return on the
Notes
|
|
150.00
|
50.000%
|
$1,212.00
|
121.200%
|
|
140.00
|
40.000%
|
$1,212.00
|
121.200%
|
|
130.00
|
30.000%
|
$1,212.00
|
121.200%
|
|
125.00
|
25.000%
|
$1,212.00
|
121.200%
|
|
121.20
|
21.200%
|
$1,212.00
|
121.200%
|
|
120.00
|
20.000%
|
$1,200.00
|
120.000%
|
|
115.00
|
15.000%
|
$1,150.00
|
115.000%
|
|
110.00
|
10.000%
|
$1,100.00
|
110.000%
|
|
105.00
|
5.000%
|
$1,050.00
|
105.000%
|
|
100.00
|
0.000%
|
$1,000.00
|
100.000%
|
|
95.00
|
-5.000%
|
$1,000.00
|
100.000%
|
|
90.00
|
-10.000%
|
$1,000.00
|
100.000%
|
|
85.00
|
-15.000%
|
$1,000.00
|
100.000%
|
|
80.00
|
-20.000%
|
$1,000.00
|
100.000%
|
|
75.00
|
-25.000%
|
$1,000.00
|
100.000%
|
|
70.00
|
-30.000%
|
$933.33
|
93.333%
|
|
65.00
|
-35.000%
|
$866.67
|
86.667%
|
|
60.00
|
-40.000%
|
$800.00
|
80.000%
|
|
55.00
|
-45.000%
|
$733.33
|
73.333%
|
|
40.00
|
-60.000%
|
$533.33
|
53.333%
|
|
25.00
|
-75.000%
|
$333.33
|
33.333%
|
|
0.00
|
-100.000%
|
$0.00
|
0.000%
|
*Represents the arithmetic average of the Closing Price of the Reference Asset on each of
the Averaging Dates.
Information Regarding the Reference Asset
The Reference Asset is registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Companies with securities registered under the Exchange
Act are required to file periodically certain financial and other information specified by the SEC. Information provided to or filed with the SEC can be inspected and copied at the public reference facilities maintained by the SEC or through the
SEC’s website at www.sec.gov. In addition, information regarding the Reference Asset may be obtained from other sources including, but not limited to, press releases, newspaper articles and other publicly disseminated documents.
The graph below sets forth the information relating to the historical performance of the Reference Asset for the period specified. We obtained the
information regarding the historical performance of the Reference Asset in the graph below from Bloomberg Professional® service (“Bloomberg”).
We have not independently verified the accuracy or completeness of the information obtained from
Bloomberg. The historical performance of the Reference Asset should not be taken as an indication of its future performance, and no assurance can be given as to the Closing Price or Final Price of the Reference Asset on any Averaging Date. We
cannot give you any assurance that the performance of the Reference Asset will result in a positive return on your initial investment.
Arista Networks, Inc.
According to publicly available information, Arista Networks, Inc. (“Arista Networks”) provides cloud networking services to large-scale internet companies, cloud
service providers and next-generation data centers and campuses for enterprise support. Information filed by Arista Networks with the SEC under the Exchange Act can be located by reference to its SEC file number: 001-36468, or its CIK Code:
0001596532. Arista Networks’ website is arista.com/en. Arista Networks’ common stock is listed on the New York Stock Exchange under the ticker symbol “ANET.”
Historical Information
The graph below illustrates the performance of the Reference Asset from June 5, 2014 through May 17, 2019.
We obtained the information regarding the historical performance of the Reference Asset in the chart below from Bloomberg.
We have not independently verified the accuracy or completeness of the information obtained from Bloomberg. The historical performance of the Reference
Asset should not be taken as an indication of its future performance, and no assurance can be given as to the Closing Price of the Reference Asset on any Averaging Date or that the performance of the Reference Asset will result in a positive return
on your initial investment.
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.
Supplemental Discussion of U.S. Federal Income Tax Consequences
The U.S. federal income tax consequences of your investment in the Notes are uncertain. No statutory, regulatory, judicial or administrative
authority directly discusses how the Notes should be treated for U.S. federal income tax purposes. Some of these tax consequences are summarized below, but we urge you to read the more detailed discussion under “Supplemental Discussion of U.S.
Federal Income Tax Consequences” in the product prospectus supplement and discuss the tax consequences of your particular situation with your tax advisor. This discussion is based upon the Internal Revenue Code of 1986, as amended (the “Code”),
final, temporary and proposed U.S. Treasury Department (the “Treasury”) regulations, rulings and decisions, in each case, as available and in effect as of the date hereof, all of which are subject to change, possibly with retroactive effect. Tax
consequences under state, local and non-U.S. laws are not addressed herein. No ruling from the U.S. Internal Revenue Service (the “IRS”) has been sought as to the U.S. federal income tax consequences of your investment in the Notes, and the
following discussion is not binding on the IRS. Except as discussed under the heading “Non-U.S. Holders”, this discussion is applicable only to a U.S. holder that acquires Notes
upon initial issuance and holds its Notes as a capital asset for U.S. federal income tax purposes.
U.S. Tax Treatment. Pursuant to the terms of the Notes, TD and you agree, in the absence of a statutory or regulatory change or an administrative determination or judicial ruling to the contrary, to characterize your Notes as prepaid
derivative contracts with respect to the Reference Asset. Holders are urged to consult their tax advisors concerning the significance, and the potential impact, of the above considerations. If your Notes are so treated, upon the taxable disposition
of a Note, you generally should recognize gain or loss in an amount equal to the difference between the amount realized on such taxable disposition and your tax basis in the Note. Your tax basis in a Note generally should equal your cost for the
Note. Such gain or loss should generally be long-term capital gain or loss if you have held your Notes for more than one year (otherwise such gain or loss should be short-term capital gain or loss if held for one year or less). The deductibility of
capital losses is subject to limitations.
Based on certain factual representations received from us, our special U.S. tax counsel, Cadwalader, Wickersham
& Taft LLP, is of the opinion that it would be reasonable to treat your Notes in the manner described above. However, because there is no authority that specifically addresses the tax treatment of the Notes, it is possible that your Notes could
alternatively be treated for tax purposes as a single contingent payment debt instrument, or pursuant to some other characterization, such that the timing and character of your income from the Notes could differ materially and adversely from the
treatment described above, as described further under “Supplemental Discussion of U.S. Federal Income Tax Consequences — Alternative Treatments” in the product prospectus supplement.
Except to the extent otherwise required by law, TD intends to treat your Notes for U.S. federal income tax purposes in accordance
with the treatment described above and under “Supplemental Discussion of U.S. Federal Income Tax Consequences” of the product prospectus supplement, unless and until such time as the Treasury and the IRS determine that some other treatment is more
appropriate.
Notice 2008-2. In 2007, the IRS released a notice
that may affect the taxation of holders of the Notes. According to Notice 2008-2, the IRS and the Treasury are actively considering whether a holder of an instrument such as the Notes should be required to accrue ordinary income on a current basis,
and they are seeking taxpayer comments on the subject. It is not possible to determine what guidance they will ultimately issue, if any. It is possible, however, that under such guidance, holders of the Notes will ultimately be required to accrue
income currently and this could be applied on a retroactive basis. The IRS and the Treasury are also considering other relevant issues, including whether additional gain or loss from such instruments should be treated as ordinary or capital,
whether non-U.S. holders of such instruments should be subject to withholding tax on any deemed income accruals, and whether the special “constructive ownership rules” of Section 1260 of the Code should be applied to such instruments. Both U.S. and
non-U.S. holders are urged to consult their tax advisors concerning the significance, and the potential impact, of the above considerations on their investments in the Notes.
Medicare Tax on Net Investment Income. U.S. holders
that are individuals, estates or certain trusts are subject to an additional 3.8% tax on all or a portion of their “net investment income” or “undistributed net investment income” in the case of an estate or trust, which may include any income or
gain with respect to the Notes, to the extent of their net investment income or undistributed net investment income (as the case may be) that, when added to their other modified adjusted gross income, exceeds $200,000 for an unmarried individual,
$250,000 for a married taxpayer filing a joint return (or a surviving spouse), $125,000 for a married individual filing a separate return or the dollar amount at which the highest tax bracket begins for an estate or trust. The 3.8% Medicare tax is
determined in a different manner than the regular income tax. U.S. holders should consult their tax advisor as to the consequences of the 3.8% Medicare tax.
Specified Foreign Financial Assets. Certain U.S. holders that own “specified foreign financial assets” in excess of an applicable threshold may be subject to reporting obligations with respect to such assets with their
tax returns, especially if such assets are held outside the custody of a U.S. financial institution. You are urged to consult your tax advisor as to the application of this legislation to your ownership of the Notes.
Non-U.S. Holders. This section applies only if you
are a non-U.S. holder. For these purposes, you are a non-U.S. holder if you are the beneficial owner of the Notes and are, for U.S. federal income tax purposes:
| • |
a non-resident alien individual;
|
| • |
a non-U.S. corporation; or
|
| • |
an estate or trust that, in either case, is not subject to U.S. federal income tax on a net income basis on income or gain from the Notes.
|
If you are a non-U.S. holder, subject to Section 871(m) of the Code and FATCA, as discussed below, you should generally not be
subject to U.S. withholding tax with respect to payments on your Notes or to generally applicable information reporting and backup withholding requirements with respect to payments on your Notes if you comply with certain certification and
identification requirements as to your non-U.S. status including providing us (and/or the applicable withholding agent) a properly executed and fully completed applicable IRS Form W-8. Subject to Section 897 of the Code and Section 871(m) of the
Code, as discussed below, gain from the taxable disposition of a Note generally should not be subject to U.S. tax unless (i) such gain is effectively connected with a trade or business conducted by you in the U.S., (ii) you are a non-resident alien
individual and are present in the U.S. for 183 days or more during the taxable year of such taxable disposition and certain other conditions are satisfied or (iii) you have certain other present or former connections with the U.S.
Section 897. We will not attempt to ascertain whether
the Reference Asset Issuer would be treated as a “United States real property holding corporation” (a “USRPHC”) within the meaning of Section 897 of the Code. We also have not attempted to determine whether the Notes should be treated as “United
States real property interests” (“USRPI”) as defined in Section 897 of the Code. If the Reference Asset Issuer and the Notes were so treated, certain adverse U.S. federal income tax consequences could possibly apply, including subjecting any gain
to a non-U.S. holder in respect of a Note upon a taxable disposition of the Note to U.S. federal income tax on a net basis, and the proceeds from such a taxable disposition to a 15% withholding tax. You should consult your tax advisor regarding the
potential treatment of any such entity as a USRPHC and the Notes as USRPI.
Section 871(m). A 30% withholding tax (which may be
reduced by an applicable income tax treaty) is imposed under Section 871(m) of the Code on certain “dividend equivalents” paid or deemed paid to a non-U.S. holder with respect to a “specified equity-linked instrument” that references one or more
dividend paying U.S. equity securities or indices containing U.S. equity securities. The withholding tax can apply even if the instrument does not provide for payments that reference dividends. Treasury regulations provide that the withholding tax
applies to all dividend equivalents paid or deemed paid on specified equity-linked instruments that have a delta of one (“delta-one specified equity-linked instruments”) issued after 2016 and to all dividend equivalents paid or deemed paid on all
other specified equity-linked instruments issued after 2018. However, the IRS has issued guidance that states that the Treasury and the IRS intend to amend the effective dates of the Treasury regulations to provide that withholding on dividend
equivalents paid or deemed paid will not apply to specified equity-linked instruments that are not delta-one specified equity-linked instruments and are issued before January 1, 2021.
Based on our determination that the Notes are not “delta-one” with respect to the Reference Asset, our special U.S. tax counsel is
of the opinion that the Notes should not be delta-one specified equity-linked instruments and thus should not be subject to withholding on dividend equivalents. Our determination is not binding on the IRS, and the IRS may disagree with this
determination. Furthermore, the application of Section 871(m) of the Code will depend on our determinations made upon issuance of the Notes. If withholding is required, we will not make payments of any additional amounts.
Nevertheless, after issuance, it is possible that your Notes could be deemed to be reissued for tax purposes upon the occurrence of
certain events affecting the Reference Asset or your Notes, and following such occurrence your Notes could be treated as delta-one specified equity-linked instruments that are subject to withholding on dividend equivalents. It is also possible that
withholding tax or other tax under Section 871(m) of the Code could apply to the Notes under these rules if you enter, or have entered, into certain other transactions in respect of the Reference Asset or the Notes. If you enter, or have entered,
into other transactions in respect of the Reference Asset or the Notes, you should consult your tax advisor regarding the application of Section 871(m) of the Code to your Notes in the context of your other transactions.
Because of the uncertainty regarding the application of the 30% withholding tax on dividend equivalents to the
Notes, you are urged to consult your tax advisor regarding the potential application of Section 871(m) of the Code and the 30% withholding tax to an investment in the Notes.
Foreign Account Tax Compliance Act. The Foreign
Account Tax Compliance Act (“FATCA”) was enacted on March 18, 2010, and imposes a 30% U.S. withholding tax on “withholdable payments” (i.e., certain U.S.-source payments, including interest (and original issue discount), dividends, other fixed or
determinable annual or periodical income, and the gross proceeds from a disposition of property of a type that can produce U.S.-source interest or dividends) and “passthru payments” (i.e., certain payments attributable to withholdable payments)
made to certain foreign financial institutions (and certain of their affiliates) unless the payee foreign financial institution agrees (or is required), among other things, to disclose the identity of any U.S. individual with an account at the
institution (or the relevant affiliate) and to annually report certain information about such account. FATCA also requires withholding agents making withholdable payments to certain foreign entities that do not disclose the name, address, and
taxpayer identification number of any substantial U.S. owners (or do not certify that they do not have any substantial U.S. owners) to withhold tax at a rate of 30%. Under certain circumstances, a holder may be eligible for refunds or credits of
such taxes.
Pursuant to final and temporary Treasury regulations and other IRS guidance, the withholding and reporting requirements under FATCA
will generally apply to certain “withholdable payments”, will not apply to gross proceeds on a sale or disposition, and will apply to certain foreign passthru payments only to the extent that such payments are made after the date that is two years
after final regulations defining the term “foreign passthru payment” are published. If withholding is required, we (or the applicable paying agent) will not be
required to pay additional amounts with respect to the amounts so withheld. Foreign financial institutions and non-financial foreign entities located in jurisdictions
that have an intergovernmental agreement with the U.S. governing FATCA may be subject to different rules.
Investors should consult their tax advisors about the application of FATCA, in particular if they may be
classified as financial institutions (or if they hold their Notes through a foreign entity) under the FATCA rules.
Proposed Legislation. In 2007,
legislation was introduced in Congress that, if it had been enacted, would have required holders of Notes purchased after the bill was enacted to accrue interest income over the term of the Notes despite the fact that there will be no interest
payments over the term of the Notes.
Furthermore, in 2013, the House Ways and Means Committee released in draft form certain proposed legislation
relating to financial instruments. If it had been enacted, the effect of this legislation generally would have been to require instruments such as the Notes to be marked to market on an annual basis with all gains and losses to be treated as
ordinary, subject to certain exceptions.
It is impossible to predict whether any similar or identical bills will be enacted in the future, or whether any such bill would
affect the tax treatment of your Notes. You are urged to consult your tax advisor regarding the possible changes in law and their possible impact on the tax treatment of your Notes.
Both U.S. and non-U.S. holders are urged to consult their tax advisors concerning the application of U.S.
federal income tax laws to their particular situations, as well as any tax consequences of the purchase, beneficial ownership and disposition of the Notes arising under the laws of any state, local, non-U.S. or other taxing jurisdiction (including
that of TD).
Supplemental Plan of Distribution (Conflicts of Interest)
We have appointed TDS, an affiliate of TD, as the Agent for the sale of the Notes. Pursuant to the terms of a distribution agreement, TDS will
purchase the Notes from TD at the public offering price less a concession equal to the underwriting discount set forth on the cover page of this pricing supplement. J.P. Morgan Securities LLC, which we refer to as JPMS LLC, and JPMorgan Chase Bank,
N.A. will act as placement agents for the Notes and, from the commission to TDS, will receive a placement fee of $10.00 for each Note they sell in this offering to accounts other than fiduciary accounts. TDS and the placement agents will forgo a
commission and placement fee for sales to fiduciary accounts. TD will reimburse TDS for certain expenses in connection with its role in the offer and sale of the Notes, and TD will pay TDS a fee in connection with its role in the offer and sale of
the Notes.
We expect to deliver the Notes against payment therefor on May 30, 2019, which is expected to be the third Business Day following the Pricing Date.
Under Rule 15c6-1 of the Exchange Act, trades in the secondary market generally are required to settle in two Business Days (“T+2”), unless the parties to a trade expressly agree otherwise. Accordingly, purchasers who wish to trade the Notes in the
secondary market on any date prior to two Business Days before delivery of the Notes will be required, by virtue of the fact that each Note initially will settle in three Business Days (“T+3”), to specify alternative settlement arrangements to
prevent a failed settlement of the secondary market trade.
Conflicts of Interest. TDS is an affiliate of TD and, as such, has a
‘‘conflict of interest’’ in this offering within the meaning of Financial Industry Regulatory Authority, Inc. (“FINRA”) Rule 5121. In addition, TD will receive the net proceeds from the initial public offering of the Notes, thus creating an
additional conflict of interest within the meaning of FINRA Rule 5121. This offering of the Notes will be conducted in compliance with the provisions of FINRA Rule 5121. In accordance with FINRA Rule 5121, neither TDS nor any other affiliated agent
of ours is permitted to sell the Notes in this offering to an account over which it exercises discretionary authority without the prior specific written approval of the account holder.
We, TDS, another of our affiliates or third parties may use this pricing supplement and any document incorporated herein by reference in the
initial sale of the Notes. In addition, we, TDS, another of our affiliates or third parties may use this pricing supplement and any document incorporated herein by reference in a market-making transaction in the Notes after their initial sale. If a purchaser buys the Notes from us, TDS, another of our affiliates or a third party, this pricing supplement is being used in a market-making transaction unless
we, TDS, another of our affiliates or such third party informs such purchaser otherwise in the confirmation of sale.
Prohibition of Sales to EEA Retail Investors
The Notes are not intended to be offered, sold or otherwise made available to and should not be offered, sold or
otherwise made available to any retail investor in the European Economic Area (“EEA”). For these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive
2014/65/EU, as amended (“MiFID II”); (ii) a customer within the meaning of Directive 2002/92/EC, as amended, where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a
qualified investor as defined in Directive 2003/71/EC, as amended. Consequently no key information document required by Regulation (EU) No 1286/2014, as amended (the “PRIIPs Regulation”), for offering or selling the Notes or otherwise making them
available to retail investors in the EEA has been prepared and therefore offering or selling the Notes or otherwise making them available to any retail investor in the EEA may be unlawful under the PRIIPs Regulation.
Additional Information Regarding the Estimated Value of the Notes
The final terms for the Notes will be determined on the date the Notes are initially priced for sale to the public, which we refer to as the
Pricing Date, based on prevailing market conditions on the Pricing Date, and will be communicated to investors in a final pricing supplement.
The economic terms of the Notes are based on our internal funding rate (which is our internal borrowing rate based on variables such as market
benchmarks and our appetite for borrowing), and several factors, including any sales commissions expected to be paid to TDS or another affiliate of ours, any selling concessions, discounts, commissions or fees expected to be allowed or paid to
non-affiliated intermediaries, the estimated profit that we or any of our affiliates expect to earn in connection with structuring the Notes, estimated costs which we may incur in connection with the Notes and the estimated cost which we may incur
in hedging our obligations under the Notes. Because our internal funding rate generally represents a discount from the levels at which our benchmark debt securities trade in the secondary market, the use of an internal funding rate for the Notes
rather than the levels at which our benchmark debt securities trade in the secondary market is expected to have an adverse effect on the economic terms of the Notes.
On the cover page of this pricing supplement, we have provided the estimated value range for the Notes. This range of estimated values was
determined by reference to our internal pricing models which take into account a number of variables and are based on a number of assumptions, which may or may not materialize, typically including volatility, interest rates (forecasted, current and
historical rates), price-sensitivity analysis, time to maturity of the Notes, and our internal funding rate. For more information about the estimated value, see “Additional Risk Factors” beginning on page P-3. Because our internal funding rate
generally represents a discount from the levels at which our benchmark debt securities trade in the secondary market, the use of an internal funding rate for the Notes rather than the levels at which our benchmark debt securities trade in the
secondary market is expected, assuming all other economic terms are held constant, to increase the estimated value of the Notes. For more information see the discussion under “Additional Risk Factors — The Estimated Value of Your Notes Is Based on
Our Internal Funding Rate.”
Our estimated value on the Pricing Date is not a prediction of the price at which the Notes may trade in the secondary market, nor will it be the
price at which the Agent may buy or sell the Notes in the secondary market. Subject to normal market and funding conditions, the Agent or another affiliate of ours intends to offer to purchase the Notes in the secondary market but it is not
obligated to do so.
Assuming that all relevant factors remain constant after the Pricing Date, the price at which the Agent may initially buy or sell the Notes in the
secondary market, if any, may exceed our estimated value on the Pricing Date for a temporary period expected to be approximately 6 months after the Issue Date because, in our discretion, we may elect to effectively reimburse to investors a portion
of the estimated cost of hedging our obligations under the Notes and other costs in connection with the Notes which we will no longer expect to incur over the term of the Notes. We made such discretionary election and determined this temporary
reimbursement period on the basis of a number of factors, including the tenor of the Notes and any agreement we may have with the distributors of the Notes. The amount of our estimated costs which we effectively reimburse to investors in this way
may not be allocated ratably throughout the reimbursement period, and we may discontinue such reimbursement at any time or revise the duration of the reimbursement period after the Issue Date of the Notes based on changes in market conditions and
other factors that cannot be predicted.
We urge you to read the “Additional Risk Factors” beginning on page P-3 of this pricing supplement.
Events of Default
The indenture provides holders of Notes with remedies if we fail to perform specific obligations, such as making payments on the Notes, or if we
become bankrupt. Holders should review the applicable provisions and understand which of our actions would trigger an event of default and which actions would not.
Under the indenture, “event of default” means any of the following:
| • |
we default in the payment of the principal of or interest on, as applicable, any note of that series and, in each case, the default continues for a period of 30 Business Days; or
|
| • |
we become insolvent or bankrupt or subject to the provisions of the Winding-up and Restructuring Act (Canada), or any statute hereafter enacted in substitution therefor, as such act, or
substituted act, may be amended from time to time, (ii) we go into liquidation, either voluntary or under an order of a court of competent jurisdiction or (iii) we pass a resolution for our winding-up, liquidation or dissolution (with
certain exceptions).
|
The indenture permits the issuance of notes in one or more series, and, in many cases, whether an event of default has occurred is determined on a
series by series basis. For purposes of this section, with respect to notes issued on or after September 23, 2018, “series” refers to notes having identical terms, except as to issue date, principal amount and, if applicable, the date from which
interest begins to accrue.
The indenture provides that:
| • |
if an event of default due to the default in payment of principal of or, if applicable, any premium or interest on, any series of senior notes issued under the indenture occurs and is
continuing, either the trustee or the holders of not less than 25% in aggregate principal amount of the outstanding senior notes of that series, voting as a single class, by notice in writing to TD (and to the trustee if given by
holders), may declare the principal of (or such other amount as may be specified) all senior notes of that series and, if applicable, interest accrued thereon to be due and payable immediately; and
|
| • |
if an event of default due to specified events of bankruptcy, insolvency, winding up or liquidation of TD, occurs and is continuing, either the trustee or the holders of not less than
25% in aggregate principal amount of all outstanding senior notes issued under the senior debt indenture, treated as one class, by notice in writing to TD (and to the trustee if given by holders), may declare the principal of (or such
other amount as may be specified) all those senior notes and, if applicable, interest accrued thereon to be due and payable immediately.
|
Annulment of Acceleration and Waiver of Defaults.
In some circumstances, if any and all events of default under the indenture with respect to notes of any series (or of all the notes, as the case
may be), other than the non-payment of the principal of the notes that has become due as a result of an acceleration, have been cured, waived or otherwise remedied, then the holders of a majority in aggregate principal amount of all the notes of
that series (or of all the notes, as the case may be), voting as a single class, then outstanding, by notice in writing to TD and to the trustee, may annul past declarations of acceleration of or waive past defaults with respect to that series (or
with respect to all the notes, as the case may be).
Differences in Events of Default
Notes issued by us prior to September 23, 2018, such as the Series A notes and the Series B notes, contain events of default that are different from those set forth
above. In particular, the events of default applicable to the Series A notes and the Series B notes do not provide for a 30-business-day cure period with respect to any failure by us to pay the principal of or, if applicable, interest on those
senior notes. Accordingly, if we fail to pay the principal of any series of Series A notes or Series B notes when due, the holders of such notes would be entitled to declare their securities due and payable following a 7-day cure period, whereas
holders of Series C notes, Series D notes or Series E notes would not be entitled to accelerate the notes until 30 Business Days after our failure to pay the principal of the notes. In addition, if we fail to pay, if applicable, interest on any
series of Series A notes or Series B notes when due, the holders of such notes would be entitled to declare their securities due and payable following a 30-calendar day cure period, whereas holders of Series C notes, Series D notes or Series E
notes would not be entitled to accelerate the notes until 30 Business Days after our failure to pay, if applicable, the interest on the notes.