Bank of Montreal Advantage Minimum Y.I.E.L.D.® Protected Deposit Notes, Series 6
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Bank of Montreal Advantage Minimum Y.I.E.L.D.® Protected Deposit Notes, Series 6 > Key Features ¾ 5 year term to maturity ¾ Minimum annual interest payment of 0.75%, payable semi-annually ¾ Annual interest ranging from 0.75% to 8.0%, payable semi-annually, based on the price performance of a portfolio of securities of 10 Canadian issuers* ¾ 100% principal protected by BMO as issuer if held to maturity * The amount of semi-annual interest paid is unlikely to mirror the price performance of the securities in the Benchmark Portfolio since the return cannot exceed 4.00% of the Deposit Amount. > Reference Portfolio The Reference Portfolio will initially consist of the common shares of 10 Canadian issuers. As of September 20, 2010, the securities in the Reference Portfolio had an average dividend or distribution yield of 3.59% and an average market capitalization of $25.36 billion CAD. The following provides an industry sector breakdown of the Reference Portfolio as well as information on each security, including the TSX ticker symbol and the indicated dividend yield and market capitalization as at September 20, 2010 (Source Bloomberg). The information in the following table is not intended to be, nor should it be construed to be, an indication as to the future dividend or distribution yield of the securities. The Reference Portfolio will not include any dividends or distributions declared on the securities. Symbol Indicated Market Gross Capitalization Dividend ($ million) Yield Utilities Barrick Gold Corporation ABX 1.15% 47,115.44 Energy 10% Consumer, 10% Enbridge Inc. ENB 3.19% 19,676.14 Cyclical Power Corporation of Canada POW 4.23% 12,572.14 10% Rogers Communications Inc. RCI.B 3.22% 22,510.28 Royal Bank of Canada RY 3.70% 76,881.13 Financial Basic Materials 30% Shoppers Drug Mart SC 2.33% 8,199.71 10% Corporation Sun Life Financial Inc. SLF 5.22% 15,697.58 Telus Corporation T 4.43% 13,860.90 Thomson Reuters Corporation TRI 3.06% 32,379.85 Communications 30% TransAlta Corporation TA 5.37% 4,746.37 Source: Bloomberg as of September 20, 2010. For further information, please contact your Investment Advisor > Hypothetical Return Examples The following examples demonstrate the calculation of interest on each valuation date in accordance with the Interest Rate Formula and are included for illustration purposes only. The examples are based on hypothetical prices and changes in prices of the securities in the Benchmark Portfolio from the closing date to applicable valuation dates and are not intended as a forecast of future prices of the securities in the Benchmark Portfolio or as a forecast of any payments of interest that may be payable during the term of the Deposit Notes. Each of the scenarios refers to a Holder holding a single Deposit Note and assumes that no Extraordinary Event or Market Disruption Event has occurred. Positive Example - Actual Returns vs.Interest Rate Power Rogers Shoppers Drug Actual vs. Barrick Gold Enbridge Corporation Communications Royal Bank of Mart Sun Life Thomson Reuters TransAlta Interest Effective Return Corporation Inc. of Canada Inc. Canada Corporation Financial Inc. Telus Corporation Corporation Corporation Average Paid Year 1 First Half Actual Return 10.000% 5.250% 8.130% 20.000% 18.300% 15.400% 6.030% 8.140% 7.650% 1.630% Effective Return 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 4.000% Year 1 Second Half Actual Return 5.000% 2.500% 4.600% 10.000% 15.000% 7.000% 2.000% 1.000% 0.550% 1.780% Effective Return 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 4.000% Year 2 First Half Actual Return 12.330% 7.440% 15.550% 1.560% 12.320% 13.220% 3.030% 0.220% 8.000% 15.850% Effective Return 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 4.000% Year 2 Second Half Actual Return 7.000% 9.600% 12.300% 9.170% 8.630% 16.210% 1.569% 0.450% 6.870% 11.460% Effective Return 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 4.000% Year 3 First Half Actual Return 13.330% -1.030% 12.440% 3.760% -6.000% 22.000% 4.330% 1.090% 14.000% 2.520% Effective Return 3.625% -1.030% 3.625% 3.625% -6.000% 3.625% 3.625% 3.625% 3.625% 3.625% 2.197% 2.572% Year 3 Second Half Actual Return 15.610% 2.980% 16.362% 4.217% 9.632% -8.141% 5.980% 7.236% 12.963% -1.002% Effective Return 3.625% 3.625% 3.625% 3.625% 3.625% -8.141% 3.625% 3.625% 3.625% -1.002% 1.986% 2.361% Year 4 First Half Actual Return 7.880% -2.050% 12.550% 23.980% 25.060% 13.000% 4.000% -2.450% 7.890% 9.650% Effective Return 3.625% -2.050% 3.625% 3.625% 3.625% 3.625% 3.625% -2.450% 3.625% 3.625% 2.450% 2.825% Year 4 Second Half Actual Return 9.630% 6.321% 13.625% 0.500% 21.324% 15.234% -12.569% 0.000% 6.321% 12.748% Effective Return 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% -12.569% 0.000% 3.625% 3.625% 1.643% 2.018% Year 5 First Half Actual Return 11.240% 4.230% 14.030% 20.000% 18.300% 15.550% 5.330% 3.350% 8.990% 4.550% Effective Return 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 4.000% Year 5 Second Half Actual Return 12.360% 9.215% 2.369% 4.589% 7.522% 18.451% 3.552% 2.510% 10.568% 4.789% Effective Return 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 3.625% 4.000% Positive Example – In the example above, for each Deposit Note, an investor would receive semi-annual interest payments of $4.00, $4.00, $4.00, $4.00, $2.57, $2.36, $2.83, $2.02, $4.00 and $4.00 over the term of the Deposit Note (assuming no Extraordinary Event has occurred). This represents a cumulative return of 33.78% of the Deposit Amount, and a semi-annually compounded rate of return of approximately 3.4%. In addition, at Maturity, an investor would receive the Deposit Amount of $100 per Deposit Note, regardless of price performance of the Reference Portfolio. Note that in this example, although the actual returns for certain issuers exceeded 4% in several periods, the corresponding interest rate cannot exceed 4%. Negative Example - Actual Returns vs. Interest Rate Power Rogers Shoppers Drug Actual vs. Barrick Gold Enbridge Corporation Communications Royal Bank of Mart Sun Life Thomson Reuters TransAlta Interest Effective Return Corporation Inc. of Canada Inc. Canada Corporation Financial Inc. Telus Corporation Corporation Corporation Average Paid Year 1 First Half Actual Return -10.000% 3.770% 5.250% -30.000% 7.650% 8.000% 20.000% 18.300% 15.400% -14.555% Effective Return -10.000% 3.625% 3.625% -15.000% 3.625% 3.625% 3.625% 3.625% 3.625% -14.555% -1.418% 0.375% Year 1 Second Half Actual Return -15.269% 5.580% 1.000% -27.000% 9.000% 7.559% 5.021% 2.269% 12.569% -8.967% Effective Return -15.000% 3.625% 3.625% -15.000% 3.625% 3.625% 3.625% 3.625% 3.625% -8.967% -1.359% 0.375% Year 2 First Half Actual Return 3.000% 6.660% 4.110% -22.000% 9.390% 7.110% 6.369% -9.523% -3.697% -7.195% Effective Return 3.625% 3.625% 3.625% -15.000% 3.625% 3.625% 3.625% -9.523% -3.697% -7.195% -1.367% 0.375% Year 2 Second Half Actual Return 4.550% 6.410% 1.020% -19.470% 5.330% 4.890% 7.440% -11.236% -5.938% -6.239% Effective Return 3.625% 3.625% 3.625% -15.000% 3.625% 3.625% 3.625% -11.236% -5.938% -6.239% -1.666% 0.375% Year 3 First Half Actual Return -0.200% -1.030% 15.230% -9.632% -6.321% 12.000% 4.336% -1.096% 17.852% -2.520% Effective Return -0.200% -1.030% 3.625% -9.632% -6.321% 3.625% 3.625% -1.096% 3.625% -2.520% -0.630% 0.375% Year 3 Second Half Actual Return 1.250% 3.256% 1.299% 4.570% -8.754% -9.632% 2.033% -7.563% -11.524% 1.563% Effective Return 3.625% 3.625% 3.625% 3.625% -8.754% -9.632% 3.625% -7.563% -11.524% 3.625% -1.572% 0.375% Year 4 First Half Actual Return 1.021% 2.063% -15.967% -23.569% 12.634% 1.256% 8.967% -8.571% 6.589% 0.630% Effective Return 3.625% 3.625% -15.000% -15.000% 3.625% 3.625% 3.625% -8.571% 3.625% 3.625% -1.320% 0.375% Year 4 Second Half Actual Return 8.960% -12.566% 6.321% 8.962% -4.328% -6.987% 7.520% -3.457% 6.589% 5.412% Effective Return 3.625% -12.566% 3.625% 3.625% -4.328% -6.987% 3.625% -3.457% 3.625% 3.625% -0.559% 0.375% Year 5 First Half Actual Return -8.562% 2.000% -24.956% -10.536% 14.562% -9.875% 5.036% 4.256% 9.661% 7.452% Effective Return -8.562% 3.625% -15.000% -10.536% 3.625% -9.875% 3.625% 3.625% 3.625% 3.625% -2.222% 0.375% Year 5 Second Half Actual Return 1.235% 8.756% -14.030% 15.327% -9.879% 5.236% -9.120% 3.865% 7.895% 5.555% Effective Return 3.625% 3.625% -14.030% 3.625% -9.879% 3.625% -9.120% 3.625% 3.625% 3.625% -0.765% 0.375% Negative Example – In the example above, for each Deposit Note, an investor would receive semi-annual interest payments of $0.375 on each of the ten semi-annual Interest Payment Dates (assuming no Extraordinary Event has occurred).