CIBC - MRRS Decision
Headnote
Mutual Reliance Review System for Exemptive Relief Applications - Exemptive relief for certain directors and seniorofficers of the Applicant and its affiliates from the insider reporting requirements in relation to two automatic securitiespurchase plans.
Applicable Ontario Statutes
Securities Act, R.S.O. 1990, c.S.5, as am., ss. 121(2).
Applicable Ontario Regulations
Regulation made under the Securities Act, R.R.O. 1990, Reg. 1015, as am.
Applicable Policies
National Policy 12-201 Mutual Reliance Review System for Exemptive Relief Applications
Proposed National Policy 55-101 Exemption from Certain Insider Reporting Requirements
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
BRITISH COLUMBIA, ALBERTA, ONTARIO AND QUÉBEC
AND
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
AND
IN THE MATTER OF CANADIAN IMPERIAL BANK OF COMMERCE
MRRS DECISION DOCUMENT
WHEREAS the Canadian securities regulatory authority or regulator (the "Decision Maker") in each of BritishColumbia, Alberta, Ontario and Québec (the "Jurisdictions") has received an application from Canadian Imperial Bankof Commerce (the "Applicant") for a decision pursuant to the securities legislation and securities directions of theJurisdictions (the "Legislation") providing an exemption from the insider reporting requirements for insiders of theApplicant, subject to certain conditions;
AND WHEREAS pursuant to the Mutual Reliance Review System for Exemptive Relief Applications (the"System"), the Ontario Securities Commission is the Principal Regulator for this application;
AND WHEREAS the Applicant has represented to the Decision Makers that:
1. The Applicant is a Schedule 1 Canadian chartered bank governed by the Bank Act (Canada) and is a reportingissuer in each of the provinces of Canada and is not in default of any requirements of the securities legislationof each province of Canada.
2. The authorized share capital of the Applicant consists of an unlimited number of common shares without parvalue, the aggregate consideration of which shall not exceed $10,000 million (the "Common Shares"), anunlimited number of Class A preferred shares and Class B preferred shares without par value, issuable inseries, the aggregate consideration of which shall not exceed $5,000 million for each class. As at October 30,2000, 377,140,195 Common Shares were issued and outstanding.
3. The Common Shares are listed and posted for trading on the Toronto, New York and London stock exchanges(the "Exchanges").
4. The Applicant has established two incentive plans (the "Plans"): (a) the Special Incentive Program ("SIP"); and(b) the Restricted Share Award ("RSA").
5. SIP is available to certain senior officers and directors of CIBC and its affiliates. RSA is available to certainsenior officers of CIBC.
6. Under the terms of the Plans, CIBC and/or its affiliates fund contributions into trust funds that purchaseCommon Shares in the open market. Amounts contributed to a trust fund are determined in accordance withthe applicable plan document.
7. A participant's award under each of the Plans is denominated into share equivalents by dividing the value ofthe participant's award by the average cost (as determined in accordance with the applicable plan document)of Common Shares purchased by a trust fund.
8. Each share equivalent represents a right (a "Right") to receive one Common Share from the trust fund whenthe Right has vested. Under SIP, a Right vests on October 31, 2003 for certain participants and for otherparticipants, on the later of October 31, 2003 or October 31 in the year that certain performance conditions aremet. Under RSA, a Right vests in equal installments over a three year period on October 31 in each year.Under each of the Plans, the Rights are not transferable.
9. Under the Plans, Rights are allocated to a participant effective the same day in each fiscal year. A participantdoes not receive notification of the number of Rights that have been granted until four to six weeks after theeffective date of the allocation.
10. An insider of the Applicant has no authority to determine the number of Rights or Common Shares acquiredunder the Plans or the prices or times at which such acquisitions are made.
11. Each of the Plans is an "automatic securities purchase plan" as such term is defined in proposed NationalInstrument NI 55-101 - Exemption From Certain Insider Reporting Requirements.
12. Neither Plan permits the acquisition of securities by an insider pursuant to a "lump sum provision" as such termis defined in NI 55-101.
13. Unless the decision sought is made, and failing any other exemptive relief, each insider of CIBC who acquiresRights or Common Shares under the Plans would be subject to the insider reporting requirements in theLegislation and would be unable to satisfy such requirements on a timely basis.
AND WHEREAS, pursuant to the System, this MRRS Decision Document evidences the decision of eachDecision Maker (collectively, the "Decision");
AND WHEREAS each of the Decision Makers is satisfied that the test contained in the Legislation that providesthe Decision Maker with the jurisdiction to make the Decision has been met;
IT IS THE DECISION of the Decision Makers pursuant to the Legislation that each current and future insideris exempt from the insider reporting requirements of the Legislation in respect of any Rights and Common Sharesacquired upon the vesting of Rights, provided that:
(a) each insider who relies on the exemption contained in this Decision shall report, in the form prescribedfor insider trading reports under the Legislation, all acquisitions of Rights and Common Shares underthe Plans that have not been previously reported by or on behalf of the insider,
(i) for any Common Shares under the Plans, during any financial year of CIBC, which havebeen disposed of or transferred, within the time required by the Legislation for reporting thedisposition or transfer; and
(ii) for any Rights acquired during a calendar year within 90 days of the calendar year;
(iii) for any Common Shares acquired under the Plans during a calendar year which have notbeen disposed of or transferred, within 90 days of the calendar year; and
(b) such exemption is not available to an insider who beneficially owns, directly or indirectly, votingsecurities of CIBC, or exercises control or direction over voting securities of CIBC or a combinationof both, that carry more than 10% of the voting rights attached to CIBC's outstanding voting securities.
December 21s, 2000.
"Howard I. Wetston" "J.A. Geller"