Filed
Pursuant to Rule 424(b)(2)
Registration
No. 333-257113
The
information in this preliminary pricing supplement is not complete and may be changed. This preliminary pricing supplement and the accompanying
underlying supplement, prospectus supplement and prospectus are not an offer to sell these securities and we are not soliciting an offer
to buy these securities in any jurisdiction where the offer or sale is not permitted.
|
Subject
to Completion, Dated March 20, 2023
Pricing
Supplement dated , 2023
(To
Equity Index Underlying Supplement dated September 2, 2021, Prospectus Supplement dated September 2, 2021,
and
Prospectus dated September 2, 2021) |
Canadian Imperial
Bank of Commerce Trigger Callable Yield Notes
$ Notes Linked
to the Russell 2000® Index due on or about June 27, 2024
Investment
Description |
These
Trigger Callable Yield Notes (the ‘‘Notes’’) are senior unsecured debt securities issued by Canadian Imperial
Bank of Commerce (“CIBC”) with returns linked to the Russell 2000® Index (the “Underlying”
or the “RTY”). The Notes will rank equally with all of our other unsecured and unsubordinated debt obligations. Unless
the Notes have been previously called, CIBC will pay a monthly interest payment at a fixed rate regardless of the performance of
the Underlying. CIBC has the right to call the Notes at its election on any monthly Call Payment Date beginning on June 23, 2023,
regardless of the level of the Underlying at that time. If the Notes are called, CIBC will pay you the principal amount of your Notes
plus the interest payment for the applicable month, and no further amounts will be owed to you under the Notes. If the Notes are
not called prior to maturity and the Final Level is equal to or greater than the Downside Threshold, CIBC will pay you a cash payment
at maturity equal to the principal amount of your Notes plus the final interest payment. If the Final Level is less than the Downside
Threshold, CIBC will pay you less than the full principal amount, if anything, resulting in a loss on your initial investment that
is proportionate to the negative performance of the Underlying over the term of the Notes, and you may lose up to 100% of your principal
amount.
Investing
in the Notes involves significant risks. If the Notes are not called by CIBC, you may lose some or all of your principal amount.
You will be exposed to the market risk of the Underlying on the Final Valuation Date. Generally, the higher the Interest Rate on
a Note, the greater the risk of loss on that Note. The contingent repayment of principal only applies if you hold the Notes to maturity
or optional issuer call. All payments on the Notes, including any repayment of principal, are subject to the creditworthiness of
CIBC. If CIBC were to default on its payment obligations, you may not receive any amounts owed to you under the Notes and you could
lose your entire investment. |
q | Monthly
Interest Payments: Regardless of the performance of the
Underlying, CIBC will pay a monthly interest payment at a fixed rate, unless the Notes have
been previously called. |
q | Issuer
Call: CIBC may, at its election, call the Notes on any
Call Payment Date commencing on June 23, 2023 and pay you the principal amount of your Notes
plus the interest payment due for that applicable month. If the Notes are not called, investors
will potentially lose a portion of their principal amount at maturity. |
q |
Contingent Repayment
of Principal Amount at Maturity: If the Notes have not been previously called by CIBC at its election and the Final Level is
not less than the Downside Threshold on the Final Valuation Date, CIBC will pay you the principal amount per Note at maturity plus
the final interest payment. If the Final Level of the Underlying on the Final Valuation Date is less than the Downside Threshold,
CIBC will pay a cash amount that is less than the principal amount, if anything, resulting in a loss on your initial investment that
is proportionate to the decline in the Closing Level of the Underlying from the Trade Date to the Final Valuation Date. The contingent
repayment of principal only applies if you hold the Notes until maturity or optional issuer call. All payments on the Notes, including
any repayment of principal, are subject to the creditworthiness of CIBC. |
Key
Dates¹ |
Trade
Date |
March
22, 2023 |
Settlement
Date |
March
27, 2023 |
Interest
Payment Dates2 |
Monthly,
commencing on April 25, 2023 |
Call
Payment Dates2 |
Monthly,
commencing on June 23, 2023 |
Final
Valuation Date2 |
June
24, 2024 |
Maturity
Date2 |
June
27, 2024 |
1 Expected
2 See page PS-4 for additional details |
THE
NOTES ARE SIGNIFICANTLY RISKIER THAN CONVENTIONAL DEBT INSTRUMENTS. THE TERMS OF THE NOTES MAY NOT OBLIGATE CIBC TO REPAY THE FULL PRINCIPAL
AMOUNT OF THE NOTES. THE NOTES CAN HAVE DOWNSIDE MARKET RISK SIMILAR TO THE UNDERLYING, WHICH CAN RESULT IN A LOSS OF SOME OR ALL OF
THE PRINCIPAL AMOUNT AT MATURITY. THIS MARKET RISK IS IN ADDITION TO THE CREDIT RISK INHERENT IN PURCHASING A DEBT OBLIGATION OF CIBC.
YOU SHOULD NOT PURCHASE THE NOTES IF YOU DO NOT UNDERSTAND OR ARE NOT COMFORTABLE WITH THE SIGNIFICANT RISKS INVOLVED IN INVESTING IN
THE NOTES.
YOU
SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED UNDER ‘‘KEY RISKS’’ BEGINNING ON PAGE PS- 6 AND THE MORE DETAILED
‘‘RISK FACTORS’’ BEGINNING ON PAGE S-1 OF THE ACCOMPANYING UNDERLYING SUPPLEMENT, BEGINNING ON PAGE S-1 OF THE
ACCOMPANYING PROSPECTUS SUPPLEMENT AND PAGE 1 OF THE ACCOMPANYING PROSPECTUS BEFORE PURCHASING ANY NOTES. EVENTS RELATING TO ANY OF THOSE
RISKS, OR OTHER RISKS AND UNCERTAINTIES, COULD ADVERSELY AFFECT THE MARKET VALUE OF, AND THE RETURN ON, YOUR NOTES.
The
Notes are offered at a minimum investment of $1,000 in denominations of $10 and integral multiples of $10 in excess thereof. The final
terms of the Notes will be determined on the Trade Date.
Underlying |
Interest
Rate |
Initial
Level |
Downside
Threshold |
CUSIP |
ISIN |
The
Russell 2000® Index
(“RTY”) |
7.00%
- 8.00% per annum |
· |
60.00%
of the Initial Level |
13608K229 |
US13608K2298 |
See
“Additional Information about the Notes” on page PS-2. The Notes offered will have the terms specified in the accompanying
prospectus, prospectus supplement and underlying supplement, and the terms set forth herein.
Neither
the U.S. Securities and Exchange Commission (the “SEC”) nor any state or provincial securities commission has approved or
disapproved of the Notes or determined if this pricing supplement or the accompanying underlying supplement, prospectus supplement or
prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The
Notes will not constitute deposits insured by the Canada Deposit Insurance Corporation (the “CDIC”), the U.S. Federal Deposit
Insurance Corporation, or any other government agency or instrumentality of Canada, the United States or any other jurisdiction. The
Notes are not bail-inable debt securities (as defined on page 6 of the prospectus). The Notes will not be listed on any securities exchange.
The
initial estimated value of the Notes on the Trade Date as determined by CIBC is expected to be between $9.576 and $9.829 per $10.00 principal
amount of the Notes, which is expected to be less than the price to public. See “Key Risks—General Risks” beginning
on page PS-7 of this pricing supplement and “The Bank’s Estimated Value of the Notes” on the last page of this pricing
supplement for additional information.
|
Price
to Public |
Underwriting
Discount(1) |
Proceeds
to Us |
Notes
Linked to: |
Total |
Per
Note |
Total |
Per
Note |
Total |
Per
Note |
The
Russell 2000® Index |
· |
$10.00 |
· |
$0.10 |
· |
$9.90 |
(1)
CIBC World Markets Corp. (“CIBCWM”), our affiliate, will purchase the Notes and, as part of the distribution of the
Notes, will sell all of the Notes to UBS Financial Services Inc. (“UBS”) at the discount specified in the table above. See
“Supplemental Plan of Distribution (Conflicts of Interest)” on the last page of this pricing supplement for additional information.
UBS
Financial Services Inc. |
CIBC
Capital Markets |
Additional
Information About the Notes |
You
should read this pricing supplement together with the prospectus dated September 2, 2021 (the “prospectus”), the prospectus
supplement dated September 2, 2021 (the “prospectus supplement”) and the Equity Index Underlying Supplement dated September
2, 2021 (the “underlying supplement”). Information in this pricing supplement supersedes information in the underlying
supplement, the prospectus supplement and the prospectus to the extent it is different from that information. Certain terms used
but not defined herein will have the meanings set forth in the underlying supplement, the prospectus supplement or the prospectus.
You
should rely only on the information contained in or incorporated by reference in this pricing supplement and the accompanying underlying
supplement, the prospectus supplement and the prospectus. This pricing supplement may be used only for the purpose for which it has
been prepared. No one is authorized to give information other than that contained in this pricing supplement and the accompanying
underlying supplement, the prospectus supplement and the prospectus, and in the documents referred to in those documents and which
are made available to the public. We, UBS and our respective affiliates have not authorized any other person to provide you with
different or additional information. If anyone provides you with different or additional information, you should not rely on it.
We,
CIBCWM and UBS are not making an offer to sell the Notes in any jurisdiction where the offer or sale is not permitted. You should
not assume that the information contained in or incorporated by reference in this pricing supplement or the accompanying underlying
supplement, the prospectus supplement or the prospectus is accurate as of any date other than the date of the applicable document.
Our business, financial condition, results of operations and prospects may have changed since that date. Neither this pricing supplement
nor the accompanying underlying supplement, the prospectus supplement or the prospectus constitutes an offer, or an invitation on
behalf of us, CIBCWM or UBS, to subscribe for and purchase any of the Notes and may not be used for or in connection with an offer
or solicitation by anyone in any jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it
is unlawful to make such an offer or solicitation.
References
to “CIBC,” “the Issuer,” “the Bank,” “we,” “us” and “our”
in this pricing supplement are references to Canadian Imperial Bank of Commerce and not to any of our subsidiaries, unless we state
otherwise or the context otherwise requires. References to “Index” in the underlying supplement will be references to
“Underlying.”
You
may access the underlying supplement, the prospectus supplement and the prospectus on the SEC website www.sec.gov as follows (or if such
address has changed, by reviewing our filing for the relevant date on the SEC website): |
The
Notes may be suitable for you if: |
|
¨ |
You fully understand the risks inherent in an investment in the
Notes, including the risk of loss of your entire initial investment. |
|
¨ |
You believe the Closing Level of the Underlying will be equal
to or greater than the Downside Threshold on the Final Valuation Date. |
|
¨ |
You are willing to make an investment where you could lose some
or all of your initial investment and are willing to make an investment that may have the same downside market risk as the Underlying. |
|
¨ |
You understand and accept that you will not participate in any
appreciation in the level of the Underlying, and your potential return is limited to the interest payments. |
|
¨ |
You are willing to invest in the Notes based on the Downside
Threshold indicated on the cover hereof and if the Interest Rate was set to the minimum indicated on the cover hereof (the actual Interest
Rate will be set on the Trade Date). |
|
¨ |
You are willing to hold the Notes that may be called early at
the election of CIBC regardless of the performance of the Underlying, or you are otherwise willing to hold the Notes to maturity and
do not seek an investment for which there is an active secondary market. |
|
¨ |
You understand and accept the risks associated with the Underlying. |
|
¨ |
You are willing to accept the risk and return profile of the
Notes versus a conventional debt security with a comparable maturity issued by CIBC or another issuer with a similar credit rating. |
|
¨ |
You are willing to forgo dividends paid on the stocks included
in the Underlying and do not seek guaranteed current income from your investment. |
|
¨ |
You are willing to assume the credit risk associated with CIBC,
as Issuer of the Notes, and understand that if CIBC defaults on its obligations, you may not receive any amounts due to you, including
any repayment of principal. |
The
Notes may not be suitable for you if: |
|
¨ |
You do not fully understand the risks inherent in an investment
in the Notes, including the risk of loss of your entire initial investment. |
|
¨ |
You believe that the level of the Underlying will decline during
the term of the Notes and is likely to close below the Downside Threshold on the Final Valuation Date. |
|
¨ |
You are not willing to make an investment in which you could
lose some or all of your initial investment and you are not willing to make an investment that may have the same downside market risk
as the Underlying. |
|
¨ |
You seek an investment that participates in the appreciation in
the level of the Underlying or that has unlimited return potential. |
|
¨ |
You are unwilling to invest in the Notes based on the Downside
Threshold indicated on the cover hereof or if the Interest Rate was set to the minimum indicated on the cover hereof (the actual Interest
Rate will be set on the Trade Date). |
|
¨ |
You are unable or unwilling to hold the Notes that will be called
early at the election of CIBC regardless of the performance of the Underlying, or you are otherwise unable or unwilling to hold the Notes
to maturity and seek an investment for which there will be an active secondary market. |
|
¨ |
You do not understand or accept the risks associated with the
Underlying. |
|
¨ |
You prefer the lower risk, and therefore accept the potentially
lower returns, of conventional debt securities with comparable maturities issued by CIBC or another issuer with a similar credit rating. |
|
¨ |
You prefer to receive the dividends paid on the stocks included
in the Underlying and seek guaranteed current income from your investment. |
|
¨ |
You are not willing or are unable to assume the credit risk associated
with CIBC, as Issuer of the Notes, for all payments on the Notes, including any repayment of principal. |
The
suitability considerations identified above are not exhaustive. Whether or not the Notes are a suitable investment for you will depend
on your individual circumstances, and you should reach an investment decision only after you and your investment, legal, tax, accounting
and other advisors have carefully considered the suitability of an investment in the Notes in light of your particular circumstances.
For more information about the Underlying, see “Information About the Underlying” in this pricing supplement, and “Index
Descriptions— The Russell Indices” beginning on page S-31 of the accompanying underlying supplement. You should also review
carefully the “Key Risks” herein and the more detailed “Risk Factors” beginning on page S-1 of the underlying
supplement and beginning on page S-1 of the accompanying prospectus supplement.
Indicative
Terms |
Issuer: |
Canadian
Imperial Bank of Commerce |
Principal
Amount: |
$10.00
per Note (subject to a minimum investment of $1,000). |
Term: |
15
months, unless earlier called |
Trade
Date¹: |
March
22, 2023 |
Settlement
Date¹: |
March
27, 2023 |
Final
Valuation Date¹: |
June
24, 2024 |
Maturity
Date¹: |
June
27, 2024 |
Reference
Asset: |
The
Russell 2000® Index (Ticker: “RTY”) (the “Underlying”) |
Issuer
Call: |
The
Notes may be called by CIBC at its election on any monthly Call Payment Date beginning on June 23, 2023 regardless of the performance
of the Underlying, upon prior notice to DTC through the trustee at least 3 Business Days and no more than 20 Business Days before
the applicable Call Payment Date. CIBC will have no independent obligation to notify you directly.
If
the Notes are called, CIBC will pay you on the applicable Interest Payment Date (which will also be the “Call Payment Date”)
a cash payment per Note equal to your principal amount plus the interest payment due on that date. No further amounts will be owed
to you under the Notes.
|
Interest
Rate: |
7.00%
to 8.00% per annum (or 0.5833% to 0.6667% per month), to be determined on the Trade Date |
Interest
Payment
Dates and Call
Payment Dates: |
|
Expected
Interest
Payment Dates1 |
|
|
|
April
25, 2023 |
|
|
|
May
24, 2023 |
|
|
|
June
23, 2023* |
|
|
|
July
25, 2023* |
|
|
|
August
23, 2023* |
|
|
|
September
25, 2023* |
|
|
|
October
25, 2023* |
|
|
|
November
24, 2023* |
|
|
|
December
26, 2023* |
|
|
|
January
24, 2024* |
|
|
|
February
23, 2024* |
|
|
|
March
25, 2024* |
|
|
|
April
24, 2024* |
|
|
|
May
23, 2024* |
|
|
|
June 27, 2024* |
|
|
*These Interest Payment Dates are also Call Payment Dates. |
|
Downside
Threshold: |
60.00%
of the Initial Level |
Payment
at Maturity (per $10 Note): |
If
the Notes have not previously been called by CIBC at its election, for each $10 principal amount of the Notes, in addition to the
final interest payment, you will receive a cash payment on the Maturity Date calculated as follows:
If
the Final Level is equal to or greater than the Downside Threshold:
$10
If
the Final Level is less than the Downside Threshold:
$10
× (1 + Underlying Return).
In
this case, you will have a loss of principal that is proportionate to the decline in the Final Level as compared to the Initial Level,
and you will lose some or all of your principal amount. Even with all interest payments, the return on the Notes may be negative.
|
Underlying
Return: |
Final
Level – Initial Level
Initial
Level
|
Initial
Level: |
The
Closing Level of the Underlying on the Trade Date. |
Final
Level: |
The
Closing Level of the Underlying on the Final Valuation Date. |
Calculation
Agent: |
Canadian
Imperial Bank of Commerce |
INVESTING
IN THE NOTES INVOLVES SIGNIFICANT RISKS. YOU MAY LOSE SOME OR ALL OF YOUR PRINCIPAL AMOUNT AT MATURITY. ANY PAYMENT ON THE NOTES,
INCLUDING ANY REPAYMENT OF PRINCIPAL, IS SUBJECT TO THE CREDITWORTHINESS OF CIBC. IF CIBC WERE TO DEFAULT ON ITS PAYMENT OBLIGATIONS,
YOU MAY NOT RECEIVE ANY AMOUNTS OWED TO YOU UNDER THE NOTES AND YOU COULD LOSE YOUR ENTIRE INVESTMENT. |
|
1
Expected. In the event CIBC makes any changes to the expected Trade Date and Settlement Date, the Final Valuation Date and
the Maturity Date will be changed so that the stated term of the Notes remains the same, and the Interest Payment Dates and the Call
Payment Dates may be adjusted in a similar manner. The Final Valuation Date and the Maturity Date are subject to postponement in
the event of a Market Disruption Event or non-trading day, as described under “Certain Terms of the Notes—Valuation Dates—For
Notes Where the Reference Asset Is a Single Index” and “—Interest Payment Dates, Coupon Payment Dates, Call Payment
Dates and Maturity Date” in the accompanying underlying supplement. |
Investment
Timeline |
|
|
Trade
Date |
|
The
Initial Level is observed and the terms of the Notes are determined. |
|
|
|
Monthly
(Callable
by CIBC at Its
Election Beginning
on June 23, 2023) |
|
Regardless
of the performance of the Underlying, CIBC will pay you an interest payment on the applicable Interest Payment Date.
CIBC
may, at its election, call the Notes prior to maturity on any monthly Call Payment Date beginning on June 23, 2023 regardless of
the performance of the Underlying. If the Notes are called, CIBC will pay you a cash payment per Note equal to $10.00 plus the interest
payment due on that date.
|
|
|
|
Maturity
Date |
|
The
Final Level and the Underlying Return of the Underlying are determined on the Final Valuation Date.
If
the Notes have not been called by CIBC at its election, in addition to the final interest payment:
If
the Final Level is equal to or greater than the Downside Threshold, CIBC will repay the principal amount equal to $10.00 per Note.
If
the Final Level is below the Downside Threshold, CIBC will pay you a cash payment at maturity that will be less than the principal
amount, if anything, resulting in a loss of principal proportionate to the decline of the Underlying, equal to an amount of:
$10
× (1 + Underlying Return) per Note
|
You
will be exposed to the market risk of the Underlying on the Final Valuation Date. Generally, the higher the Interest Rate on a Note,
the greater the risk of loss on that Note.
An
investment in the Notes involves significant risks. Some of the risks that apply to the Notes are summarized here. However, CIBC urges
you to read the more detailed explanation of risks relating to the Notes in the “Risk Factors” section of the accompanying
underlying supplement and the accompanying prospectus supplement. CIBC also urges you to consult your investment, legal, tax, accounting
and other advisors before you invest in the Notes.
Structure
Risks
| ¨ | Risk
of Loss at Maturity — The Notes differ from ordinary debt securities in that CIBC
will not necessarily pay the full principal amount of the Notes. If the Notes are not called
by CIBC at its election, CIBC will only pay you the principal amount of your Notes in cash
at maturity if the Final Level is greater than or equal to the Downside Threshold. If the
Notes are not called by CIBC at its election and the Final Level is less than the Downside
Threshold, you will lose some or all of your initial investment in an amount proportionate
to the decline in the Final Level from the Initial Level. You may lose some or all of your
principal amount at maturity. |
| ¨ | The
Contingent Repayment of Principal Applies Only Upon an Optional Issuer Call or at Maturity
— You should be willing to hold your Notes to an optional issuer call or maturity.
If you are able to sell your Notes prior to an optional issuer call or maturity in the secondary
market, you may have to sell them at a loss relative to your investment even if the level
of the Underlying at that time is above the Downside Threshold. |
| ¨ | There
Can Be No Assurance that the Investment View Implicit in the Notes Will Be Successful —
It is impossible to predict whether and the extent to which the level of the Underlying
will rise or fall. There can be no assurance that the Final Level will be equal to or greater
than the Downside Threshold. The level of the Underlying will be influenced by complex and
interrelated political, economic, financial and other factors that affect issuers of the
securities included in the Underlying. You should be willing to accept the risk of losing
a significant portion or all of your initial investment. |
| ¨ | Your
Potential Return on the Notes Is Limited to All Interest Payments and You Will Not Participate
in Any Appreciation of the Underlying Or Underlying Constituents — The return potential
of the Notes is limited to the Interest Rate regardless of any appreciation of the Underlying.
Further, the return potential of the Notes is limited by the issuer call feature in that
you will not receive any further payments after the Notes are called. It is more likely that
we will call the Notes prior to maturity to the extent that the Interest Rate is higher than
the yield payable on our conventional debt securities with a similar maturity. Your Notes
could be called as early as June 23, 2023, and your return could be minimal. If the Notes
are not called, you may be exposed to the decline in the level of the Underlying even though
you cannot participate in any potential appreciation in the level of the Underlying. As a
result, the return on an investment in the Notes could be less than the return on a direct
investment in securities represented by the Underlying. |
| ¨ | Reinvestment
Risk — If your Notes are called early, the term of the Notes will be reduced and
you will not receive any payment on the Notes after the applicable Call Payment Date. There
is no guarantee that you would be able to reinvest the proceeds from an optional issuer call
of the Notes at a comparable rate of return for a similar level of risk. To the extent you
are able to reinvest such proceeds in an investment comparable to the Notes, you may incur
transaction costs. The Notes may be called as early as approximately 3 months after issuance. |
| ¨ | Higher
Interest Rates or Lower Downside Thresholds Are Generally Associated with the Underlying
with Greater Expected Volatility and Therefore Can Indicate a Greater Risk of Loss —
”Volatility” refers to the frequency and magnitude of changes in the level
of the Underlying. The greater the expected volatility with respect to the Underlying on
the Trade Date, the higher the expectation as of the Trade Date that the Underlying could
close below the Downside Threshold on the Final Valuation Date, resulting in the loss of
some or all of your investment. This greater expected risk will generally be reflected in
a higher Interest Rate than the yield payable on our conventional debt securities with a
similar maturity, or in more favorable terms (such as a lower Downside Threshold or a higher
Interest Rate) than for similar securities linked to the performance of the Underlying with
a lower expected volatility as of the Trade Date. You should therefore understand that a
relatively higher Interest Rate may indicate an increased risk of loss. Further, a relatively
lower Downside Threshold may not necessarily indicate that the Notes have a greater likelihood
of a repayment of principal at maturity. The volatility of the Underlying can change significantly
over the term of the Notes. The level of the Underlying for your Notes could fall sharply,
which could result in a significant loss of principal. You should be willing to accept the
downside market risk of the Underlying and the potential to lose some or all of your principal
at maturity. |
Underlying
Risks
| ¨ | The
Notes Are Subject to Small-Capitalization Risk — The RTY tracks companies that
may be considered small-capitalization companies. These companies often have greater stock
price volatility, lower trading volume and less liquidity than large-capitalization companies
and therefore, the relevant index level may be more volatile than an investment in stocks
issued by larger companies. Stock prices of small-capitalization companies may also be more
vulnerable than those of larger companies to adverse business and economic developments,
and the stocks of small-capitalization companies may be thinly traded, making it difficult
for the RTY to track them. In addition, small-capitalization companies are often less stable
financially than large-capitalization companies and may depend on a small number of key personnel,
making them more vulnerable to loss of personnel. Small-capitalization companies are often
subject to less analyst coverage and may be in early, and less predictable, periods of their
corporate existences. These companies tend to have smaller revenues, less diverse product
lines, smaller shares of their product or service markets, fewer financial resources and
competitive strengths than large-capitalization companies, and are more susceptible to adverse
developments related to their products. All these factors may adversely affect the level
of the RTY and consequently, the return on the Notes. |
| ¨ | Owning
the Notes Is Not the Same as Owning the Stocks Included in the Underlying — The
return on your Notes may not reflect the return you would realize if you actually owned the
stocks included in the Underlying. As a holder of the Notes, you will not have voting rights
or rights to receive dividends or other distributions or other rights that holders of the
stocks included in the Underlying would |
|
|
have. Furthermore, the Underlying and the stocks included in the Underlying may appreciate substantially during the term of your Notes,
and you will not participate in such appreciation. |
| ¨ | Changes
Affecting the Underlying May Adversely Affect the Level of the Underlying — The
policies of the Underlying sponsor concerning additions, deletions and substitutions of the
stocks included in the Underlying and the manner in which the Underlying sponsor takes account
of certain changes affecting those stocks included in the Underlying may adversely affect
the level of the Underlying. The policies of the Underlying sponsor with respect to the calculation
of the Underlying could also adversely affect the level of the Underlying. The Underlying
sponsor may discontinue or suspend calculation or dissemination of the Underlying. Any such
actions could have an adverse effect on the level of the Underlying and consequently, the
value of the Notes. |
Conflicts
of Interest
| ¨ | Certain
Business, Trading and Hedging Activities of Us, UBS, and Our Respective Affiliates May Create
Conflicts With Your Interests and Could Potentially Adversely Affect the Value of the Notes
— We, UBS, and our respective affiliates may engage in trading and other business
activities related to the Underlying or any securities included in the Underlying that are
not for your account or on your behalf. We, UBS, and our respective affiliates also may issue
or underwrite other financial instruments with returns based upon the Underlying. These activities
may present a conflict of interest between your interest in the Notes and the interests that
we, UBS, and our respective affiliates may have in our or their proprietary accounts, in
facilitating transactions, including block trades, for our or their other customers, and
in accounts under our or their management. In addition, we, UBS, and our respective affiliates
may publish research, express opinions or provide recommendations that are inconsistent with
investing in or holding the Notes, and which may be revised at any time. Any such research,
opinions or recommendations could adversely affect the level of the Underlying, and therefore,
the market value of the Notes. These trading and other business activities, if they affect
the level of the Underlying or secondary trading in your Notes, could be adverse to your
interests as a beneficial owner of the Notes. |
|
|
Moreover, we, UBS, and our respective affiliates play a variety of roles in connection with the issuance of the Notes, including hedging
our obligations under the Notes and making the assumptions and inputs used to determine the pricing of the Notes and the initial estimated
value of the Notes when the terms of the Notes are set. We expect to hedge our obligations under the Notes through CIBCWM, UBS, one of
our or its affiliates, and/or another unaffiliated counterparty, which may include any dealer from which you purchase the Notes. Any
of these hedging activities may adversely affect the level of the Underlying and therefore the market value of the Notes and the amount
you will receive, if any, on the Notes. In connection with such activities, the economic interests of us, UBS, and our respective affiliates
may be adverse to your interests as an investor in the Notes. Any of these activities may adversely affect the value of the Notes. In
addition, because hedging our obligations entails risk and may be influenced by market forces beyond our control, this hedging activity
may result in a profit that is more or less than expected, or it may result in a loss. We, UBS, one or more of our respective affiliates
or any unaffiliated counterparty will retain any profits realized in hedging our obligations under the Notes even if investors do not
receive a favorable investment return under the terms of the Notes or in any secondary market transaction. Any profit in connection with
such hedging activities will be in addition to any other compensation that we, UBS, our respective affiliates or any unaffiliated counterparty
receive for the sale of the Notes, which creates an additional incentive to sell the Notes to you. We, UBS, our respective affiliates
or any unaffiliated counterparty will have no obligation to take, refrain from taking or cease taking any action with respect to these
transactions based on the potential effect on an investor in the Notes. |
| ¨ | There
Are Potential Conflicts of Interest Between You and the Calculation Agent — The
calculation agent will determine, among other things, the amount of payments on the Notes.
The calculation agent will exercise its judgment when performing its functions. For example,
the calculation agent will determine whether a Market Disruption Event affecting the Underlying
has occurred, and determine the Closing Level of the Underlying if the scheduled Final Valuation
Date is postponed to the last possible day. See “Certain Terms of the Notes—Valuation
Dates—For Notes Where the Reference Asset Is a Single Index” in the underlying
supplement. This determination may, in turn, depend on the calculation agent’s judgment
as to whether the event has materially interfered with our ability or the ability of one
of our affiliates to unwind our hedge positions. The calculation agent will be required to
carry out its duties in good faith and use its reasonable judgment. However, because we will
be the calculation agent, potential conflicts of interest could arise. None of us, CIBCWM
or any of our other affiliates will have any obligation to consider your interests as a holder
of the Notes in taking any action that might affect the value of your Notes. |
Tax Risks
| ¨ | The
Tax Treatment of the Notes Is Uncertain — Significant aspects of the tax treatment
of the Notes are uncertain. You should consult your tax advisor about your own tax situation.
See “United States Federal Income Tax Considerations” and “Certain Canadian
Federal Income Tax Considerations” in this pricing supplement, “Material U.S.
Federal Income Tax Consequences” in the underlying supplement and “Material Income
Tax Consequences—Canadian Taxation” in the prospectus. |
General
Risks
| ¨ | Payments
on the Notes Are Subject to Our Credit Risk, and Actual or Perceived Changes in Our Creditworthiness
Are Expected to Affect the Value of the Notes — The Notes are our senior unsecured
debt obligations and are not, either directly or indirectly, an obligation of any third party.
As further described in the accompanying prospectus and prospectus supplement, the Notes
will rank on par with all of our other unsecured and unsubordinated debt obligations, except
such obligations as may be preferred by operation of law. All payments to be made on the
Notes depend on our ability to satisfy our obligations as they come due. As a result, the
actual and perceived creditworthiness of us may affect the market value of the Notes and,
in the event we were to default on our obligations, you may not receive the amounts owed
to you under the terms of the Notes. If we default on our obligations under the Notes, your
investment would be at risk and you could lose some or all of your investment. See “Description
of Senior Debt Securities—Events of Default” in the accompanying prospectus. |
| ¨ | The
Notes Will Be Subject to Risks Under Canadian Bank Resolution Powers — Under Canadian
bank resolution powers, the CDIC may, in circumstances where the Bank has ceased, or is about
to cease, to be viable, assume temporary control or ownership of the Bank |
|
|
and may
be granted broad powers by one or more orders of the Governor in Council (Canada), each of which we refer to as an “Order,”
including the power to sell or dispose of all or a part of the assets of the Bank, and the power to carry out or cause the Bank to
carry out a transaction or a series of transactions the purpose of which is to restructure the business of the Bank. If the CDIC
were to take action under the Canadian bank resolution powers with respect to the Bank, this could result in holders or beneficial
owners of the Notes being exposed to losses. |
| ¨ | The
Bank’s Initial Estimated Value of the Notes Will Be Lower Than the Initial Issue Price
(Price to Public) of the Notes — The initial issue price of the Notes will exceed
the Bank’s initial estimated value because costs associated with selling and structuring
the Notes, as well as hedging the Notes, are included in the initial issue price of the Notes.
See “The Bank’s Estimated Value of the Notes” on the last page of this
pricing supplement. |
| ¨ | The
Bank’s Initial Estimated Value Does Not Represent Future Values of the Notes and May
Differ From Others’ Estimates — The Bank’s initial estimated value
of the Notes is only an estimate, which will be determined by reference to the Bank’s
internal pricing models when the terms of the Notes are set. This estimated value will be
based on market conditions and other relevant factors existing at that time, the Bank’s
internal funding rate on the Trade Date and the Bank’s assumptions about market parameters,
which can include volatility, dividend rates, interest rates and other factors. Different
pricing models and assumptions could provide valuations for the Notes that are greater or
less than the Bank’s initial estimated value. In addition, market conditions and other
relevant factors in the future may change, and any assumptions may prove to be incorrect.
On future dates, the market value of the Notes could change significantly based on, among
other things, changes in market conditions, including the level of the Underlying, the Bank’s
creditworthiness, interest rate movements and other relevant factors, which may impact the
price at which CIBCWM or any other party would be willing to buy the Notes from you in any
secondary market transactions. The Bank’s initial estimated value does not represent
a minimum price at which CIBCWM or any other party would be willing to buy the Notes in any
secondary market (if any exists) at any time. See “The Bank’s Estimated Value
of the Notes” on the last page of this pricing supplement. |
| ¨ | The
Bank’s Initial Estimated Value of the Notes Will Not Be Determined by Reference to
Credit Spreads for Our Conventional Fixed-Rate Debt — The internal funding rate
to be used in the determination of the Bank’s initial estimated value of the Notes
generally represents a discount from the credit spreads for our conventional fixed-rate debt.
The 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. If the Bank were
to use the interest rate implied by our conventional fixed-rate debt, we would expect the
economic terms of the Notes to be more favorable to you. Consequently, our use of an internal
funding rate for market-linked Notes would have an adverse effect on the economic terms of
the Notes, the initial estimated value of the Notes on the Trade Date, and any secondary
market prices of the Notes. See “The Bank’s Estimated Value of the Notes”
on the last page of this pricing supplement. |
| ¨ | If
CIBCWM Were to Repurchase Your Notes After the Settlement Date, the Price May Be Higher Than
the Then-Current Estimated Value of the Notes for a Limited Time Period — While
CIBCWM may make markets in the Notes, it is under no obligation to do so and may discontinue
any market-making activities at any time without notice. The price that it makes available
from time to time after the Settlement Date at which it would be willing to repurchase the
Notes will generally reflect its estimate of their value. That estimated value will be based
upon a variety of factors, including then prevailing market conditions, our creditworthiness
and transaction costs. However, for a period of approximately 4 months after the Trade Date,
the price at which CIBCWM may repurchase the Notes is expected to be higher than their estimated
value at that time. This is because, at the beginning of this period, that price will not
include certain costs that were included in the initial issue price, particularly our hedging
costs and profits. As the period continues, these costs are expected to be gradually included
in the price that CIBCWM would be willing to pay, and the difference between that price and
CIBCWM’s estimate of the value of the Notes will decrease over time until the end of
this period. After this period, if CIBCWM continues to make a market in the Notes, the prices
that it would pay for them are expected to reflect its estimated value, as well as customary
bid-ask spreads for similar trades. In addition, the value of the Notes shown on your account
statement may not be identical to the price at which CIBCWM would be willing to purchase
the Notes at that time, and could be lower than CIBCWM’s price. |
| ¨ | Economic
and Market Factors May Adversely Affect the Terms and Market Price of the Notes Prior to
Maturity or Call — Because structured notes, including the Notes, can be thought
of as having a debt and derivative component, factors that influence the values of debt instruments
and options and other derivatives will also affect the terms and features of the Notes at
issuance and the market price of the Notes prior to maturity or call. These factors include
the level of the Underlying; the volatility of the Underlying; the dividend rate paid on
stocks included in the Underlying; the time remaining to the maturity or call of the Notes;
interest rates in the markets in general; geopolitical conditions and economic, financial,
political, regulatory, judicial or other events; and the creditworthiness of CIBC. These
and other factors are unpredictable and interrelated and may offset or magnify each other. |
| ¨ | The
Notes Will Not Be Listed on Any Securities Exchange and We Do Not Expect a Trading Market
for the Notes to Develop — The Notes will not be listed on any securities exchange.
Although CIBCWM and/or its affiliates intend to purchase the Notes from holders, they are
not obligated to do so and are not required to make a market for the Notes. There can be
no assurance that a secondary market will develop for the Notes. Because we do not expect
that any market makers will participate in a secondary market for the Notes, the price at
which you may be able to sell your Notes is likely to depend on the price, if any, at which
CIBCWM and/or its affiliates are willing to buy your Notes. |
| | If
a secondary market does exist, it may be limited. Accordingly, there may be a limited number
of buyers if you decide to sell your Notes prior to maturity or optional issuer call. This
may affect the price you receive upon such sale. Consequently, you should be willing to hold
the Notes to maturity or optional issuer call. |
Hypothetical
Scenario Analysis and Examples |
The
scenario analysis and examples below are hypothetical and provided for illustrative purposes only. They do not purport to be representative
of every possible scenario concerning increases or decreases in the level of the Underlying relative to the Initial Level. The hypothetical
terms used below are not the actual terms. The actual terms will be set on the Trade Date and will be indicated on the cover of the applicable
pricing supplement. We cannot predict the Final Level or the Closing Level of the Underlying on the Final Valuation Date. You should
not take the scenario analysis and these examples as an indication or assurance of the expected performance of the Underlying. The numbers
appearing in the examples below may have been rounded for ease of analysis. The following scenario analysis and examples illustrate the
Payment at Maturity or upon optional issuer call per $10.00 Note on a hypothetical offering of the Notes, based on the following assumptions:
Investment Term: |
15 months (unless earlier called) |
Hypothetical Initial Level: |
1,000 |
Hypothetical Interest Rate: |
7.00% per annum (or 0.5833% per month) |
Hypothetical Interest: |
$0.05833 per month |
Call Payment Dates: |
Monthly, commencing on June 23, 2023 |
Hypothetical Downside Threshold: |
600.00 (60.00% of the Initial Level) |
Example 1
— Notes Are Called on the First Call Payment Date, Which Corresponds to the Third Interest Payment Date
Date |
Closing
Level |
Payment
(per Note) |
First
and Second Interest Payment Dates |
Any |
$0.05833
x 2 = $0.11666 (Interest) |
Third
Interest Payment Date (and First Call Payment Date) |
Any |
$10.05833
(Settlement Amount) |
|
Total
Payment: |
$10.17499
(1.7499% return) |
Since
the Issuer elects to call the Notes on the first Call Payment Date (which is the third Interest Payment Date), CIBC will pay you on the
Call Payment Date a total of $10.05833 per Note, reflecting your principal amount plus the applicable interest payment. When added to
the interest payments of $0.11666 received in respect of the previous Interest Payment Dates, CIBC will have paid you a total of $10.17499
per Note, for a 1.7499% total return on the Notes. No further amount will be owed to you under the Notes.
Example 2
— Notes Are NOT Called and the Final Level Is at or Above the Downside Threshold
Date |
Closing
Level |
Payment
(per Note) |
First
through Fourteenth Interest Payment Dates |
Any |
Issuer
does NOT elect to call the Notes on any Call Payment Date.
$0.05833 x 14 = $0.81662 (Interest) |
Final
Valuation Date |
850
(at or above Downside Threshold, below Initial Level) |
$10.05833
(Payment at Maturity) |
|
Total
Payment: |
$10.87495
(8.7495% return) |
Since
the Issuer does not elect to call the Notes prior to maturity and the Final Level is at or above the Downside Threshold, CIBC will pay
you at maturity a total of $10.05833 per Note, reflecting your principal amount plus the applicable interest payment. When added to the
interest payments of $0.81662 received in respect of the Interest Payment Dates prior to the Final Valuation Date, CIBC will have paid
you a total of $10.87495 per Note, for a 8.7495% total return on the Notes.
Example 3
— Notes Are NOT Called and the Final Level Is Below the Downside Threshold
Date |
Closing
Level |
Payment
(per Note) |
First
through Fourteenth Interest Payment Dates |
Any |
Issuer
does NOT elect to call the Notes on any Call Payment Date.
$0.05833 x 14 = $0.81662 (Interest) |
Final
Valuation Date |
200
(below Downside Threshold and Initial Level) |
$10.00
× (1 + Underlying Return ) + Final Interest Payment
= $10.00 × (1 + -80%) + $0.05833
= $10.00 - $8.00 + $0.05833
= $2.05833 (Payment at Maturity) |
|
Total
Payment: |
$2.87495
(-71.2505% return) |
Since
the Issuer does not elect to call the Notes prior to maturity and the Final Level is below the Downside Threshold, CIBC will pay you
at maturity $2.05833 per Note. When added to the interest payments of $0.81662 received in respect of the Interest Payment Dates prior
to the Final Valuation Date, CIBC will have paid you $2.87495 per Note, for a -71.2505% total return on the Notes.
Information
About the Underlying |
The
Russell 2000® Index
The
Russell 2000® Index (Bloomberg ticker: “RTY <Index>”) is calculated, maintained and published by FTSE
Russell. The RTY is designed to track the performance of the small capitalization segment of the U.S. equity market. The RTY is a subset
of the Russell 3000® Index and represents approximately 10% of the total market capitalization of that index. The RTY
includes approximately 2,000 of the smallest securities in the U.S. equity market. See “Index Descriptions—The Russell Indices”
beginning on page S-31 of the accompanying underlying supplement for additional information about the RTY.
In
addition, information about the Underlying may be obtained from other sources, including, but not limited to, the index sponsor’s
website (including information regarding the Underlying’s sector weightings). We are not incorporating by reference into this pricing
supplement the website or any material it includes. None of us, UBS or any of our respective affiliates makes any representation that
such publicly available information regarding the Underlying is accurate or complete.
Historical
Performance of the Underlying
The
graph below illustrates the performance of the Underlying from January 1, 2018 to March 17, 2023, based on the daily Closing Levels as
reported by Bloomberg L.P. (“Bloomberg”), without independent verification. We have not conducted any independent review
or due diligence of the publicly available information from Bloomberg. On March 17, 2023, the Closing Level of the Underlying was 1,725.891
(the “Hypothetical Initial Level”). The green line indicates a hypothetical Downside Threshold of 1,035.535, which is equal
to 60.00% of the Hypothetical Initial Level. The historical performance of the Underlying should not be taken as an indication of its
future performance, and no assurances can be given as to the level of the Underlying at any time during the term of the Notes, including
the Final Valuation Date. We cannot give you assurance that the performance of the Underlying will result in the return of any of your
investment.
Historical
Performance of the Russell 2000® Index
|
Source:
Bloomberg |
United
States Federal Income Tax Considerations |
The
following discussion is a brief summary of the material U.S. federal income tax considerations relating to an investment in the Notes.
The following summary is not complete and is both qualified and supplemented by (although to the extent inconsistent supersedes) the
discussion entitled “Material U.S. Federal Income Tax Consequences” in the underlying supplement, which you should carefully
review prior to investing in the Notes. Except with respect to the section below under “Non-U.S. Holders,” it applies only
to those U.S. Holders who are not excluded from the discussion of United States Taxation in the accompanying prospectus.
The
U.S. federal income tax considerations of your investment in the Notes are uncertain. No statutory, judicial or administrative authority
directly discusses how the Notes should be treated for U.S. federal income tax purposes. Under one approach (which is different than
the approach discussed in the underlying supplement), each Note should be treated as an investment unit consisting of a put option written
by you (the “Put Option”) and a non-contingent debt instrument issued by us to you (the “Debt Portion”). In the
opinion of our tax counsel, Mayer Brown LLP, it would generally be reasonable to treat a Note as consisting of the Debt Portion and the
Put Option for all U.S. federal income tax purposes. Pursuant to the terms of the Notes, you agree to treat the Notes in this manner
for all U.S. federal income tax purposes. If this treatment is respected, you should include the portion of the stated interest payments
on the Note that is treated as interest in income in accordance with your regular method of accounting for interest for U.S. federal
income tax purposes. The portion of the stated interest payments that are treated as payments on the Put Option (the “Put Premium”)
should not generally be taxable to you upon its receipt. For purposes of dividing the Interest Rate of [·]%
on the Notes among interest on the Debt Portion and Put Premium, [·]%
constitutes interest on the Debt Portion and [·]%
constitutes Put Premium.
If
you were to receive a cash payment of the full principal amount of the Notes upon the redemption or maturity of the Notes, such payment
would likely be treated as (i) payment in full of the principal amount of the Debt Portion (which would not result in the recognition
of gain or loss if you are an initial purchaser of the Notes) and (ii) the lapse of the Put Option which would likely result in your
recognition of short-term capital gain in an amount equal to the amount paid to you for the Put Option and deferred as described above.
If you were to receive a cash payment upon the redemption or maturity of the Notes (excluding cash received as a coupon) of less than
the full principal amount of the Notes, such payment would likely be treated as (i) payment in full of the principal amount of the Debt
Portion (which would not result in the recognition of gain or loss if you are an initial purchaser of the Notes) and (ii) the cash settlement
of the Put Option pursuant to which you paid to us an amount equal to the excess of the principal amount of the Notes over the amount
that you received upon the maturity of the Notes (excluding cash received as a coupon) in order to settle the Put Option. If the aggregate
amount paid to you for the Put Option and deferred as described above is greater than the amount you are deemed to have paid to us to
settle the Put Option, you will likely recognize short-term capital gain in an amount that is equal to such excess. Conversely, if the
amount paid to you for the Put Option and deferred as described above is less than the amount you are deemed to have paid to us to settle
the Put Option, you will likely recognize short-term capital loss in an amount that is equal to such difference.
Upon
a sale, or other taxable disposition of a Note for cash, you should allocate the cash received between the Debt Portion and the Put Option
on the basis of their respective values on the date of sale. You should generally recognize gain or loss with respect to the Debt Portion
in an amount equal to the difference between the amount of the sales proceeds allocable to the Debt Portion (less accrued and unpaid
“qualified stated interest” or accrued acquisition discount that you have not included in income, which will be treated as
ordinary interest income) and your adjusted tax basis in the Debt Portion (which will generally equal the initial purchase price of the
Notes increased by any accrued acquisition discount or original issue discount previously included in income on the Debt Portion and
decreased by the amount of any payment (other than an interest payment that is treated as qualified stated interest) received on the
Debt Portion). Such gain or loss should be capital gain or loss and should be long-term capital gain or loss if you have held the Debt
Portion for more than one year at the time of such disposition. The ability to use capital losses to offset ordinary income is limited.
If the Put Option has a positive value on the date of a sale of a Note, you should recognize short-term capital gain equal to the portion
of the sale proceeds allocable to the Put Option plus any previously received Put Premium. If the Put Option has a negative value on
the date of sale, you should be treated as having paid the buyer an amount equal to the negative value in order to assume your rights
and obligations under the Put Option. In such a case, you should recognize a short-term capital gain or loss in an amount equal to the
difference between the total Put Premium previously received and the amount of the payment deemed made by you with respect to the assumption
of the Put Option. The amount of the deemed payment will be added to the sales price allocated to the Debt Portion in determining the
gain or loss in respect of the Debt Portion. The ability to use capital losses to offset ordinary income is limited.
The
expected characterization of the Notes is not binding on the U.S. Internal Revenue Service (the “IRS”) or the courts. It
is possible that the IRS would seek to characterize the Notes in the manner described in the accompanying underlying supplement, or in
a manner that results in tax consequences to you that are different from those described above or in the accompanying underlying supplement.
For a more detailed discussion of certain alternative characterizations with respect to the Notes and certain other considerations with
respect to an investment in the Notes, you should consider the discussion set forth in “Material U.S. Federal Income Tax Consequences”
of the underlying supplement. We are not responsible for any adverse consequences that you may experience as a result of any alternative
characterization of the Notes for U.S. federal income tax or other tax purposes.
Non
U.S.-Holders. A “dividend equivalent” payment is treated as a dividend from sources within the United States and such payments
generally would be subject to a 30% U.S. withholding tax if paid to a Non-U.S. Holder. Under Treasury regulations, payments (including
deemed payments) with respect to equity-linked instruments (“ELIs”) that are “specified ELIs” may be treated
as dividend equivalents if such specified ELIs reference an interest in an “underlying security,” which is generally any
interest in an entity taxable as a corporation for U.S. federal income tax purposes if a payment with respect to such interest could
give rise to a U.S. source dividend. However, Internal Revenue Service guidance provides that withholding on dividend equivalent payments
will not apply to specified ELIs that are not delta-one instruments and that are issued before January 1, 2025. We expect that the delta
of the Notes will not be one, and therefore, we expect that Non-U.S. Holder should not be subject to withholding on dividend equivalent
payments, if any, under the Notes. However, it is possible that the Notes could be treated as deemed reissued for U.S. federal income
tax purposes upon the occurrence of certain events affecting the Underlying or the Notes, and following such occurrence the Notes could
be treated as subject to withholding on dividend equivalent payments. Non-U.S. Holders that enter, or have entered, into other transactions
in respect of the Underlying or the Notes should consult their tax advisors as to the application of the dividend equivalent withholding
tax in the context of the Notes and their other transactions. If any payments are treated as dividend equivalents subject to withholding,
we (or the applicable paying agent) would be entitled to withhold taxes without being required to pay any additional amounts with respect
to amounts so withheld.
You
should consult your tax advisor as to the tax consequences of such characterization and any possible alternative characterizations of
the Notes for U.S. federal income tax purposes. You should also consult your tax advisor concerning the U.S. federal income tax and other
tax consequences of your investment in the Notes in your particular circumstances, including the application of state, local or other
tax laws and the possible effects of changes in federal or other tax laws.
Certain
Canadian Federal Income Tax Considerations |
In
the opinion of Blake, Cassels & Graydon LLP, our Canadian tax counsel, the following summary describes the principal Canadian
federal income tax considerations under the Income Tax Act (Canada) and the regulations thereto (the “Canadian Tax Act”)
generally applicable at the date hereof to a purchaser who acquires beneficial ownership of a Note pursuant to this pricing supplement
and who for the purposes of the Canadian Tax Act and at all relevant times: (a) is neither resident nor deemed to be resident in
Canada; (b) deals at arm’s length with the Issuer and any transferee resident (or deemed to be resident) in Canada to whom
the purchaser disposes of the Note; (c) does not use or hold and is not deemed to use or hold the Note in, or in the course of, carrying
on a business in Canada; (d) is entitled to receive all payments (including any interest and principal) made on the Note; (e) is
not a, and deals at arm’s length with any, “specified shareholder” of the Issuer for purposes of the thin capitalization
rules in the Canadian Tax Act; and (f) is not an entity in respect of which the Issuer is a “specified entity” for purposes
of the Hybrid Mismatch Proposals, as defined below (a “Non-Resident Holder”). For these purposes, a “specified
shareholder” generally includes a person who (either alone or together with persons with whom that person is not dealing at
arm’s length for the purposes of the Canadian Tax Act) owns or has the right to acquire or control or is otherwise deemed to
own 25% or more of the Issuer’s shares determined on a votes or fair market value basis, and an entity in respect of which
the Issuer is a “specified entity” generally includes (i) an entity that is a specified shareholder of the Issuer (as
defined above), (ii) an entity in which the Issuer (either alone or together with entities with whom the Issuer is not dealing at
arm’s length for purposes of the Canadian Tax Act) owns or has the right to acquire or control or is otherwise deemed to own
a 25% or greater equity interest, and (iii) an entity in which an entity described in (i) (either alone or together with entities
with whom such entity is not dealing at arm’s length for purposes of the Canadian Tax Act) owns or has the right to acquire
or control or is otherwise deemed to own a 25% or greater equity interest. Special rules which apply to non-resident insurers carrying
on business in Canada and elsewhere are not discussed in this summary.
For
greater certainty, this summary takes into account all specific proposals to amend the Canadian Tax Act publicly announced by or
on behalf of the Minister of Finance (Canada) prior to the date hereof, including the proposals released on April 29, 2022 with respect
to “hybrid mismatch arrangements” (the “Hybrid Mismatch Proposals”). This summary assumes that no amount
paid or payable to a holder described herein will be the deduction component of a “hybrid mismatch arrangement” under
which the payment arises within the meaning of proposed paragraph 18.4(3)(b) of the Canadian Tax Act contained in the Hybrid Mismatch
Proposals. Investors should note that the Hybrid Mismatch Proposals are in consultation form, are highly complex, and there remains
significant uncertainty as to their interpretation and application. There can be no assurance that the Hybrid Mismatch Proposals
will be enacted in their current form, or at all.
This
summary is supplemental to and should be read together with the description of material Canadian federal income tax considerations
relevant to a Non-Resident Holder owning Notes under “Material Income Tax Consequences—Canadian Taxation” in the
accompanying prospectus and a Non-Resident Holder should carefully read that description as well.
This
summary is of a general nature only and is not intended to be, nor should it be construed to be, legal or tax advice to any particular
Non-Resident Holder. Non-Resident Holders are advised to consult with their own tax advisors with respect to their particular circumstances.
Interest
payable on the Notes should not be considered to be “participating debt interest” as defined in the Canadian Tax Act
and accordingly, a Non-Resident Holder should not be subject to Canadian non-resident withholding tax in respect of amounts paid
or credited or deemed to have been paid or credited by the Issuer on a Note as, on account of or in lieu of payment of, or in satisfaction
of, interest.
Non-Resident
Holders should consult their own advisors regarding the consequences to them of a disposition of the Notes to a person with whom
they are not dealing at arm’s length for purposes of the Canadian Tax Act.
|
Supplemental
Plan of Distribution (Conflicts of Interest) |
Pursuant
to the terms of a distribution agreement, CIBCWM will purchase the Notes from CIBC for distribution to UBS (the “Agent”).
CIBCWM will agree to sell to the Agent, and the Agent will agree to purchase, all of the Notes at the price to public less the underwriting
discount set forth on the cover hereof. The Agent may allow a concession to its affiliates not in excess of the underwriting discount
set forth on the cover hereof.
CIBCWM
is our affiliate, and is deemed to have a conflict of interest under FINRA Rule 5121. In accordance with FINRA Rule 5121, CIBCWM may
not make sales in this offering to any of its discretionary accounts without the prior written approval of the customer.
We
expect to deliver the Notes against payment therefor in New York, New York on a date that is more than two business days following the
Trade Date. Under Rule 15c6-1 of the Securities Exchange Act of 1934, trades in the secondary market generally are required to settle
in two business days, unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade the Notes
on any date prior to two business days before delivery will be required to specify alternative settlement arrangements to prevent a failed
settlement.
The
Bank may use this pricing supplement in the initial sale of the Notes. In addition, CIBCWM or another of the Bank’s affiliates
may use this pricing supplement in market-making transactions in any Notes after their initial sale. Unless CIBCWM or we inform you otherwise
in the confirmation of sale, this pricing supplement is being used by CIBCWM in a market-making transaction.
While
CIBCWM may make markets in the Notes, it is under no obligation to do so and may discontinue any market-making activities at any time
without notice. See the section titled “Supplemental Plan of Distribution (Conflicts of Interest)” in the accompanying prospectus
supplement.
The
price at which you purchase the Notes includes costs that the Bank or its affiliates expect to incur and profits that the Bank or its
affiliates expect to realize in connection with hedging activities related to the Notes. These costs and profits will likely reduce the
secondary market price, if any secondary market develops, for the Notes. As a result, you may experience an immediate and substantial
decline in the market value of your Notes on the Settlement Date.
The
Bank’s Estimated Value of the Notes |
The
Bank’s initial estimated value of the Notes set forth on the cover of this pricing supplement is equal to the sum of the values
of the following hypothetical components: (1) a fixed-income debt component with the same maturity as the Notes, valued using our internal
funding rate for structured debt described below, and (2) the derivative or derivatives underlying the economic terms of the Notes. The
Bank’s initial estimated value does not represent a minimum price at which CIBCWM or any other person would be willing to buy your
Notes in any secondary market (if any exists) at any time. The internal funding rate used in the determination of the Bank’s initial
estimated value generally represents a discount from the credit spreads for our conventional fixed-rate debt. The 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. For additional information, see “Key Risks—The
Bank’s Initial Estimated Value of the Notes Will Not Be Determined by Reference to Credit Spreads for Our Conventional Fixed-Rate
Debt” in this pricing supplement. The value of the derivative or derivatives underlying the economic terms of the Notes is derived
from the Bank’s or a third party hedge provider’s internal pricing models. These models are dependent on inputs such as the
traded market prices of comparable derivative instruments and on various other inputs, some of which are market-observable, and which
can include volatility, dividend rates, interest rates and other factors, as well as assumptions about future market events and/or environments.
Accordingly, the Bank’s initial estimated value of the Notes will be determined when the terms of the Notes are set based on market
conditions and other relevant factors and assumptions existing at that time. See “Key Risks—The Bank’s Initial Estimated
Value Does Not Represent Future Values of the Notes and May Differ From Others’ Estimates” in this pricing supplement.
The
Bank’s initial estimated value of the Notes will be lower than the initial issue price of the Notes because costs associated with
selling, structuring and hedging the Notes are included in the initial issue price of the Notes. These costs include the selling commissions
paid to CIBCWM and other affiliated or unaffiliated dealers, the projected profits that our hedge counterparties, which may include our
affiliates, expect to realize for assuming risks inherent in hedging our obligations under the Notes and the estimated cost of hedging
our obligations under the Notes. Because hedging our obligations entails risk 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 it may result in a loss. We or one or more of our affiliates
will retain any profits realized in hedging our obligations under the Notes. See “Key Risks—The Bank’s Initial Estimated
Value of the Notes Will Be Lower Than the Initial Issue Price (Price to Public) of the Notes” in this pricing supplement.
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