The Toronto-Dominion Bank is offering Callable Contingent Interest Barrier Notes linked to the least performing of the iShares® Russell 2000 ETF, the Invesco QQQ TrustSM, Series 1, and the SPDR® S&P 500® ETF Trust. The Notes will pay a 11.25% Contingent Interest Rate only if the Closing Value of each Reference Asset is greater than or equal to its 70.00% Initial Value on the Contingent Interest Observation Date. If not, no Contingent Interest Payment will be paid.
Key features and risks:
- Callable Feature: TD may call the Notes in whole on any Call Payment Date (quarterly, starting from the first Contingent Interest Payment Date) with at least three Business Days' prior notice, regardless of the Reference Assets' values. If called, investors will receive the Principal Amount plus any accrued Contingent Interest Payment.
- Maturity Payment: If not called, the payment at maturity will depend on the Final Value of each Reference Asset relative to its 70.00% Barrier Value:
- If all Final Values are greater than or equal to the Barrier Value, investors receive $1,000 Principal Amount.
- If any Final Value is less than the Barrier Value, investors receive $1,000 plus the product of $1,000 times the Least Performing Percentage Change, potentially resulting in a loss of up to the entire Principal Amount.
- Contingent Interest Payment: Only paid if the Closing Value of each Reference Asset is greater than or equal to its Contingent Interest Barrier Value on the Contingent Interest Observation Date. No payment means no return.
- Market Risk: Investors are fully exposed to the market risk of each Reference Asset on each Contingent Interest Observation Date. Poor performance of any single asset will negatively impact the return and is not offset by others.
- Liquidity Risk: The Notes are not listed and may have limited secondary market liquidity, with potential for significant losses if sold before maturity.
- Estimated Value: The estimated value of the Notes on the Pricing Date is expected to be between $955.00 and $990.00 per Note, lower than the public offering price, reflecting costs, expected profits, and hedging.
- Taxation: The U.S. tax treatment of the Notes is uncertain, with potential for ordinary income treatment of Contingent Interest Payments and potential for constructive ownership rules to apply.
- Conflicts of Interest: TD Securities (USA) LLC, as the Agent, has a conflict of interest due to its affiliation with TD and receipt of net proceeds from the offering. Additionally, TD and its affiliates may engage in hedging activities and business with Reference Asset Constituent Issuers, which could affect the Notes' value.
Investors should be aware that the Notes do not guarantee the return of Principal Amount and are subject to significant risks, including potential loss of investment, limited liquidity, and uncertain tax treatment. The Notes are structured to provide returns linked to the performance of the least performing of the three Reference Assets, making them more sensitive to individual asset performance and market conditions.
