New Issue: Bank of Montreal sells $38,000 16% reverse exchangeables tied to Yahoo!

By Marisa Wong

Madison, Wis., Dec. 27 - Bank of Montreal priced $38,000 of 16% annualized reverse exchangeable notes due March 30, 2012 linked to Yahoo! Inc. shares, according to a 424B2 filing with the Securities and Exchange Commission.

Interest is payable monthly.

The payout at maturity will be par unless Yahoo! stock closes below the trigger price - 75% of the initial share price - during the life of the notes and the final share price is less than the initial share price, in which case the payout will be a number of shares of Yahoo! stock equal to $1,000 divided by the initial share price or, at the issuer's option, the cash equivalent.

BMO Capital Markets Corp. is the agent.

Issuer:	Bank of Montreal
Issue:	Reverse exchangeable notes
Underlying stock:	Yahoo! Inc. (Symbol: YHOO)
Amount:	$38,000
Maturity:	March 30, 2012
Coupon:	16%, payable monthly
Price:	Par
Payout at maturity:	If Yahoo! stock ever closes below trigger price and finishes below initial price, shares of Yahoo! stock equal to $1,000 divided by the initial share price or, at the issuer's option, the cash equivalent; otherwise, par
Initial share price:	$15.99
Trigger price:	$11.99, 75% of initial share price
Pricing date:	Dec. 22
Settlement date:	Dec. 30
Agent:	BMO Capital Markets Corp.
Fees:	1.75%
Cusip:	06366QN78

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