By Angela McDaniels
Tacoma, Wash., April 26 – Bank of Montreal priced $27.5 million of notes due April 30, 2018 linked to a basket of 24 equally weighted stocks selected in March by Raymond James & Associates, Inc., according to a 424B2 filing with the Securities and Exchange Commission.
The underlying stocks are AvalonBay Communities, Inc.; Boeing Co.; BB&T Corp.; Cisco Systems, Inc.; CSX Corp.; Chevron Corp.; General Electric Co.; General Mills, Inc.; Johnson Controls, Inc.; JPMorgan Chase & Co.; Coca-Cola Co.; Lockheed Martin Corp.; Altria Group, Inc.; NextEra Energy, Inc.; PepsiCo, Inc.; Pfizer Inc.; Procter & Gamble Co.; Qualcomm, Inc.; Schlumberger Ltd.; Simon Property Group, Inc.; AT&T Inc.; United Parcel Service, Inc.; Verizon Communications Inc. and WEC Energy Group, Inc.
Raymond James’ objective was to select securities included in the S&P 500 index that have dividend yields higher than the index constituents as a whole, could sustain or increase their dividend and had credit ratings considered lower medium grade or higher. Raymond James also sought to produce a basket that, based on historical experience, would be likely to suffer less price volatility than the S&P 500 components as a whole.
The notes may pay a variable coupon. Interest, if any, is payable quarterly and will equal the sum of the dividend amounts for each of the reference shares multiplied by 96.75%.
For each reference share, the dividend amount is an amount in dollars equal to (a) $1,000 divided by the applicable adjusted initial share price multiplied by (b) the applicable reference share weighting multiplied by (c) 100% of the gross cash distributions per reference share declared by the applicable reference share issuer where the date that the applicable reference share has begun trading ex-dividend occurs during the relevant interest calculation period.
For each $1,000 principal amount of notes, the payout at maturity will be $1,000 multiplied by 96.75% multiplied by the basket level percentage. Because of the 96.75% participation rate, investors will receive less than par if the basket level percentage is less than 103.36%.
For each stock, its initial share price is the average of its average intraday prices on each averaging date – April 22, April 25 an April 26 – plus $0.01.
For each stock, its final share price will be the average of its closing share prices on April 23, 2018, April 24, 2018 and April 25, 2018 minus $0.01.
BMO Capital Markets Corp. is the agent. Raymond James is acting as a dealer and will receive a 2% fee.
| Issuer: | Bank of Montreal
|
| Issue: | Notes linked to Raymond James quality yield stock basket
|
| Underlying stocks: | AvalonBay Communities, Inc.; Boeing Co.; BB&T Corp.; Cisco Systems, Inc.; CSX Corp.; Chevron Corp.; General Electric Co.; General Mills, Inc.; Johnson Controls, Inc.; JPMorgan Chase & Co.; Coca-Cola Co.; Lockheed Martin Corp.; Altria Group, Inc.; NextEra Energy, Inc.; PepsiCo, Inc.; Pfizer Inc.; Procter & Gamble Co.; Qualcomm, Inc.; Schlumberger Ltd.; Simon Property Group, Inc.; AT&T Inc.; United Parcel Service, Inc.; Verizon Communications Inc. and WEC Energy Group, Inc.
|
| Amount: | $27.5 million
|
| Maturity: | April 30, 2018
|
| Coupon: | Notes may pay variable coupon; interest, if any, is payable quarterly and equals sum of dividend amounts for each reference share multiplied by 96.75%
|
| Price: | Par
|
| Payout at maturity: | For each $1,000 principal amount of notes, $1,000 multiplied by 96.75% multiplied by basket level percentage
|
| Pricing date: | April 22
|
| Settlement date: | April 29
|
| Agent: | BMO Capital Markets Corp.
|
| Selected dealer: | Raymond James & Associates, Inc.
|
| Fees: | 2% paid to Raymond James
|
| Cusip: | 06367TBW9
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
