$150M BMO Preferred Share Offering

Bank of Montreal issued $150 million of Non-Cumulative Five-Year Rate Reset Class B Preferred Shares Series 18 on December 11, 2008. The offering was underwritten on a bought deal basis by a syndicate led by BMO Capital Markets and included CIBC World Markets, RBC Capital Markets, Scotia Capital Inc., TD Securities Inc., Desjardins Securities Inc., National Bank Financial Inc., HSBC Securities (Canada) Inc., Brookfield Financial Corp. and Laurentian Bank Securities Inc. The preferred shares were issued to the public at a price of $25 per preferred share and holders will be entitled to receive non-cumulative preferential quarterly dividends as and when declared by the board of directors of the bank, payable in the amount of $0.40625 per preferred share, to yield 6.50 per cent annually commencing on the closing date and ending on February 25, 2014. Thereafter, the dividend rate will reset every five years to be equal to the five-year Government of Canada Bond Yield plus 3.83 per cent. Subject to certain conditions, holders may elect to convert any or all of their preferred shares into an equal number of Non-Cumulative Floating Rate Class B Preferred Shares Series 19 on February 25, 2014, and on February 25th of every fifth year thereafter. The deal was announced on November 25, 2008, and closed on December 11, 2008.

Bank of Montreal was advised by in-house counsel Paul Noble and assisted by Rick Fullerton, Kashif Zaman and Justin Williams (corporate) and Lara Friedlander and Helen Ferrigan (tax) of Osler, Hoskin & Harcourt LLP.

BMO Nesbitt Burns Inc. and the syndicate of underwriters were advised by Andrew Parker and Matthew Appleby (business law), together with Barry Ryan, as well as Gabrielle M. Richards (tax) of McCarthy Tétrault LLP.