Bank of Montreal plans 12.75% reverse exchangeables on Sears Holdings

By Jennifer Chiou

New York, March 30 - Bank of Montreal plans to price reverse exchangeable notes due Oct. 20, 2011 linked to the common stock of Sears Holdings Corp., according to a 424B2 filing with the Securities and Exchange Commission.

The six-month notes are expected to carry a coupon of 12.75% per year. Interest will be payable monthly.

The payout at maturity will be par unless Sears Holdings 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 Sears Holdings stock equal to $1,000 divided by the initial share price or, at the issuer's option, a cash amount equal to the value of those shares.

The notes (Cusip: 06366QFQ5) are expected to price on April 15 and settle on April 20.

BMO Capital Markets Corp. is the agent.

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