Registration Statement No. 333-196387

Filed Pursuant to Rule 424(b)(2) 

    

Amended and Restated Pricing Supplement dated December 19, 2016 to the Pricing Supplement dated December 13, 2016

(To the Prospectus dated June 27, 2014 and
the Prospectus Supplement dated June 27, 2014)

$250,000,000

Senior Medium-Term Notes, Series C

Linked to Raymond James Analysts’ Best Picks^® for 2017,

due December 21, 2017

 

·

The notes are linked to an equally-weighted basket of shares of 17 common stocks (each, a “Reference Share” and together, the “Basket”) of entities that are not affiliated with us (each, a “Reference Share Issuer”). The Reference Shares were selected in December 2016 by the Equity Research Department at Raymond James & Associates, Inc. (“Raymond James”) as the Raymond James Analysts’ Best Picks® for 2017.

 

·	You may lose all or a portion of the principal amount of your notes at maturity.

 

·

The Reference Shares are: ARRIS International plc (“ARRS”); Avnet, Inc. (“AVT”); CyrusOne Inc. (“CONE”); Halliburton Company (“HAL”); Mohawk Industries, Inc. (“MHK”); Monolithic Power Systems, Inc. (“MPWR”); Marathon Oil Corporation (“MRO”); Microsoft Corporation (“MSFT”); Mylan N.V. (“MYL”); Newell Brands Inc. (“NWL”); Oasis Petroleum Inc. (“OAS”); O’Reilly Automotive, Inc. (“ORLY”); Bank of the Ozarks, Inc. (“OZRK”); Roper Technologies, Inc. (“ROP”); UnitedHealth Group Incorporated (“UNH”); Willis Towers Watson Public Limited Company (“WLTW”); and Wintrust Financial Corporation (“WTFC”). Each Reference Share has an equal weighting of 1/17th. This pricing supplement contains a description of the criteria used to select the Reference Shares for inclusion in the Basket. See “Raymond James Analysts’ Best Picks for 2017.”

 

·	The notes do not pay any interest.

 

·

On the maturity date, the amount that we will pay to you for each $1,000 in principal amount of the notes (the “Redemption Amount”) will depend upon the performance of the Basket and the dividends paid on the Reference Shares over the term of the notes. As described in more detail below, the Redemption Amount will be less than the price to the public set forth below if the “Basket Level Percentage” (as defined below) is not at least approximately 103.09%. We describe in more detail below how the payment at maturity will be determined.

 

·	Any payment at maturity on the notes is subject to our credit risk.

 

·	The notes will not be listed on any securities exchange or quotation system.

 

·	The CUSIP number of the notes is 06367TMJ6.

 

·	Our subsidiary, BMO Capital Markets Corp. (“BMOCM”), is the agent for this offering. See “Supplemental Plan of Distribution—Conflicts of Interest” below.

 

BMO Capital Markets

 

 

 

 

 

ADDITIONAL TERMS OF THE NOTES

 

You should read this pricing supplement together with the prospectus supplement dated June 27, 2014 and the prospectus dated June 27, 2014. This pricing supplement, together with the documents listed below, contains the terms of the notes and supersedes all other prior or contemporaneous oral statements as well as any other written materials including preliminary or indicative pricing terms, correspondence, trade ideas, structures for implementation, sample structures, fact sheets, brochures or other educational materials of ours or the agent. You should carefully consider, among other things, the matters set forth in “Additional Risk Factors” in this pricing supplement, as the notes involve risks not associated with conventional debt securities. We urge you to consult your investment, legal, tax, accounting and other advisers before you invest in the notes.

 

You may access these documents on the SEC website at www.sec.gov as follows (or if such address has changed, by reviewing our filings for the relevant date on the SEC website):

 

·

Prospectus supplement dated June 27, 2014: http://www.sec.gov/Archives/edgar/data/927971/000119312514254915/d750935d424b5.htm

 

·

Prospectus dated June 27, 2014: http://www.sec.gov/Archives/edgar/data/927971/000119312514254905/d749601d424b2.htm

 

Our Central Index Key, or CIK, on the SEC website is 927971.  As used in this pricing supplement, “we,” “us” or “our” refers to Bank of Montreal.

 

 

ADDITIONAL RISK FACTORS

 

An investment in the notes involves risks.  This section describes significant risks relating to the terms of the notes.  The notes are a riskier investment than ordinary debt securities.  In addition, the notes are not equivalent to investing directly in the Reference Shares.  Before investing in the notes, you should read the following information about these risks, together with the other information contained in or incorporated by reference in the prospectus supplement and prospectus.

 

General Risks Relating to the Notes

 

Your investment in the notes may result in a loss.  The notes do not guarantee any return of principal. The amount payable on the notes at maturity will depend on the performance of the Reference Shares and the applicable Dividend Amount and may be less, and possibly significantly less, than your initial investment. If the prices of the Reference Shares decrease, the payment at maturity may be less than the principal amount. In addition, because the Participation Rate is only 97.00%, the Basket Level Percentage must exceed approximately 103.09% in order for you to receive a Redemption Amount that exceeds the principal amount. You may lose all or a substantial portion of the amount that you invested to purchase the notes. You may incur a loss, even if the Basket Level Percentage is positive (but less than approximately 103.09%). Please also see “—The notes will not reflect the full performance of the Reference Shares, which may negatively impact your return on the notes.”

 

The notes do not pay interest and your return may be lower than the return on a conventional debt security of comparable maturity.  There will be no periodic interest payments on the notes as there would be on a conventional fixed-rate or floating-rate debt security having the same maturity.  The yield that you will receive on your notes, which could be negative, may be less than the yield you could earn if you purchased a standard senior debt security of Bank of Montreal with the same maturity date.  Your investment may not reflect the full opportunity cost to you when you take into account factors that affect the time value of money.

Owning the notes is not the same as owning the Reference Shares or a security directly linked to the performance of the Reference Shares.  The return on your notes will not reflect the return you would realize if you actually owned the Reference Shares or a security directly linked to the performance of the Reference Shares and held that investment for a similar period.  Your notes may trade quite differently from the Reference Shares.  Changes in the prices and dividend yields of the Reference Shares may not result in comparable changes in the market value of your notes.  Even if the prices and dividend yields of the Reference Shares increase during the term of the notes, the market value of the notes prior to maturity may not increase to the same extent.  It is also possible for the market value of the notes to decrease while the prices and dividend yields of the Reference Shares increase.

 

Our initial estimated value of the notes is lower than the price to public.  Our initial estimated value of the notes is only an estimate, and is based on a number of factors.  The price to public of the notes exceeds our initial estimated value, because, among other things, costs associated with offering, structuring and hedging the notes are included in the price to public, but are not included in the estimated value.  These costs include the agent’s commission, and the profits that we and our affiliates expect to realize for assuming the risks in hedging our obligations under the notes and the estimated cost of hedging these obligations.

 

Our initial estimated value does not represent any future value of the notes, and may also differ from the estimated value of any other party.  Our initial estimated value of the notes as of the pricing date was derived using our internal pricing models.  This value is based on market conditions, interest rates, and other relevant factors.  Different pricing models and assumptions could provide values for the notes that are greater than or less than our initial estimated value.  In addition, market conditions and other relevant factors after the pricing date are expected to change, possibly rapidly, and our assumptions may prove to be incorrect.  After the pricing date, the value of the notes could change dramatically due to changes in market conditions, our creditworthiness, and the other factors set forth in this pricing supplement. These changes are likely to impact the price, if any, at which we or BMOCM would be willing to purchase the notes from you in any secondary market transactions.  Our initial estimated values do not represent a minimum price at which we or our affiliates would be willing to buy your notes in any secondary market at any time.

 

The terms of the notes were not determined by reference to the credit spreads for our conventional fixed-rate debt.  To determine the terms of the notes, we used an internal funding rate that represents a discount from the credit spreads for our conventional fixed-rate debt.  As a result, the terms of the notes are less favorable to you than if we had used a higher funding rate.

 

Certain costs are likely to adversely affect the value of the notes.  Absent any changes in market conditions, any secondary market prices of the notes will likely be lower than the price to public.  This is because any secondary market prices will likely take into account our then-current market credit spreads, and because any secondary market prices are likely to exclude all or a portion of the agent’s commission and the hedging profits and estimated hedging costs that are included in the price to public of the notes and that may be reflected on your account statements.  In addition, any such price is also likely to reflect a discount to account for costs associated with establishing or unwinding any related hedge transaction, such as dealer discounts, mark-ups and other transaction costs.  As a result, the price, if any, at which BMOCM or any other party may be willing to purchase the notes from you in secondary market transactions, if at all, will likely be lower than the price to public.  Any sale that you make prior to the maturity date could result in a substantial loss to you.

 

 

Any increase in the price of one or more Reference Shares may be offset by decreases in the price of one or more other Reference Shares.  The price of one or more of the Reference Shares may increase while the price of one or more of the other Reference Shares decreases.  Therefore, in determining the value of the Basket at any time, increases in the price of one Reference Share may be moderated, or wholly offset, by decreases in the price of one or more other Reference Shares.  You may incur a loss, even if the Basket Level Percentage is positive (but less than 103.09%).

 

The notes may not have an active trading market.  Your notes will not be listed on any securities exchange, and there may be little or no secondary market for your notes. Even if a secondary market for your notes develops, it may not provide significant liquidity.  We expect that transaction costs in any secondary market would be high.  As a result, the difference between bid and ask prices for your notes in any secondary market could be substantial.  If you sell your notes before maturity, you may suffer substantial losses.

 

The notes will not reflect the full performance of the Reference Shares, which may negatively impact your return on the notes.  Because the calculation of the Redemption Amount includes a Participation Rate of less than 100%, the return, if any, on the notes will not reflect the full performance of the Reference Shares. Therefore, the yield to maturity based on the methodology for calculating the Redemption Amount will be less than the yield that would be produced if the Reference Shares were purchased and held for a similar period. The Basket Level Percentage must be at least approximately 103.09% for the Redemption Amount to exceed the principal amount.

 

In addition, as to the Reference Shares that are organized outside of the U.S., the Dividend Amounts that are reflected in the payments on the notes may be reduced as discussed in the section below, “Description of the Notes—Payment at Maturity.”

 

The market value of your notes may be influenced by many unpredictable factors.  The following factors, many of which are beyond our control, may influence the market value of your notes:

 

·

the market prices of the Reference Shares;

 

·

the dividend yields of the Reference Shares;

 

·

economic, financial, political, military, regulatory, legal and other events that affect the securities markets generally and the U.S. markets in particular, and which may affect the values of the Reference Shares;

 

·

if the Reference Shares include one or more equity securities that have been issued by non-U.S. companies (a “non-U.S. Reference Share”), changes in, and the volatility of, the exchange rates between the U.S. dollar and the relevant non-U.S. currency or currencies could have a negative impact on the payments due on your notes and their market value; and

 

·

interest rates in the market.

 

These factors may influence the market value of your notes if you sell your notes before maturity.  Our creditworthiness, as represented by our credit ratings or as otherwise perceived in the market will also affect the market value of your notes.  If you sell your notes prior to maturity, you may receive less than your initial investment.

 

Payments on the notes are subject to our credit risk, and changes in our credit ratings may adversely affect the market value of the notes.  The notes are our senior unsecured debt securities.  The payment amount due on the maturity date is dependent upon our ability to repay our obligations at that time.  This will be the case even if the values and dividend yields of the Reference Shares increase as of the valuation dates.  No assurance can be given as to what our financial condition will be at any time during the term of the notes.

    

    

As a result, the hedging activities relating to each Reference Share by us or any of our affiliates may have affected the calculation agent’s determination of the Initial Share Price for each Reference Share; therefore, these hedging activities may adversely affect the payment at maturity, if any.

    

The Final Share Price of each Reference Share is based on the arithmetic average of its closing prices on each valuation date and may be less than the closing prices of such Reference Share prior to such dates or on any valuation date individually.  The Final Share Price of each Reference Share will be calculated based on the closing prices of that Reference Share on each of the valuation dates specified above.  The prices prior to those dates will not be used to determine the Redemption Amount.  Therefore, no matter how high the prices of the relevant Reference Shares may be during the term of the notes, only the closing prices of the Reference Shares on each of the valuation dates will be used to calculate the applicable Final Share Prices and the Redemption Amount payable to you at maturity.  In addition, because each Final Share Price is based on the arithmetic average of the closing prices of the relevant Reference Share on each valuation date, the Final Share Price calculated in this manner may be lower than the price of the relevant Reference Share on any single valuation date.  Accordingly, the averaging feature may decrease the Final Share Price and therefore your return on the notes.

 

Correlation among the Reference Shares may affect the value of your notes.  The Reference Shares may not represent a diversified portfolio of securities.  To the extent that the Reference Shares move in the same direction (i.e., are highly correlated), you will lose some or all of the benefits that would ordinarily attend a diversified portfolio of securities.  The Reference Shares may be concentrated in a limited number of industries.  An investment in the notes might increase your exposure to fluctuations in any of the sectors represented by the Basket.

 

We will not hold shares of any Reference Share for your benefit.  The indenture and the terms governing your notes do not contain any restriction on our ability or the ability of any of our affiliates to sell, pledge or otherwise convey all or any portion of Reference Shares that we or they may acquire.  Neither we nor our affiliates will pledge or otherwise hold any assets for your benefit, including any Reference Shares.  Consequently, in the event of our bankruptcy, insolvency or liquidation, any of those assets that we own will be subject to the claims of our creditors generally and will not be available for your benefit specifically.

 

You must rely on your own evaluation of the merits of an investment linked to the Reference Shares.  In the ordinary course of their business, BMOCM, Raymond James and our respective affiliates may have expressed views on expected movements in any Reference Share, and may do so in the future.  These views or reports may be communicated to our clients, Raymond James’ clients, and clients of our respective affiliates.  However, these views are subject to change from time to time.  Moreover, other professionals who transact business in markets relating to any Reference Share may at any time have significantly different views from those of our respective affiliates.  For these reasons, you are encouraged to derive information concerning the Reference Shares from multiple sources, and you should not rely solely on views expressed by us or our respective affiliates.

 

Our trading and other transactions relating to the Reference Shares, futures, options or other derivative products may adversely affect the market value of the notes.  As described below under “Use of Proceeds and Hedging,” we or our affiliates may hedge our obligations under the notes by purchasing or selling the Reference Shares, futures or options relating to the Reference Shares, or other derivative instruments with returns linked or related to changes in the performance of the Reference Shares.  We may adjust these hedges by, among other things, purchasing or selling those assets at any time.  Although they are not expected to do so, any of these hedging activities may adversely affect the prices of the Reference Shares, and therefore, the market value of the notes, and the amount payable at maturity.  It is possible that we or one or more of our affiliates could receive substantial returns from these hedging activities, even though the market value of the notes decreases.

 

We, Raymond James, or one or more of our respective affiliates may also engage in trading relating to the Reference Shares on a regular basis as part of our general broker-dealer and other businesses, for proprietary accounts, for other accounts under management or to facilitate transactions for our customers, including block trades.  Any of these activities could adversely affect the prices of the Reference Shares and, therefore, the market value of the notes.  We, Raymond James, or one or more of our respective affiliates may also issue or underwrite other securities or financial or derivative instruments with returns linked or related to changes in the performance of the Reference Shares.  By introducing competing products into the marketplace in this manner, we or one or more of our affiliates could adversely affect the market value of the notes.

 

 

Our business activities and the business activities of our affiliates may create conflicts of interest.  As noted above, we, Raymond James, or one or more of our respective affiliates expect to engage in trading activities related to the Reference Shares that are not for the account of holders of the notes or on their behalf.  These trading activities may present a conflict between the holders’ interests in the notes and the interests we and our affiliates will have in their proprietary accounts, in facilitating transactions, including options and other derivatives transactions, for their customers and in accounts under their management.  These trading activities, if they influence the prices of the Reference Shares, could be adverse to the interests of the holders of the notes.  We, Raymond James, or one or more of our respective affiliates may, at present or in the future, engage in business with the issuers of the Reference Shares, including making loans to or providing advisory services to those companies.  These services could include investment banking and merger and acquisition advisory services.  These activities may present a conflict between our or one or more of our affiliates’ obligations and your interests as a holder of the notes.  Moreover, we, Raymond James and our respective affiliates have published, and in the future expect to publish, research reports with respect to most or even all of the Reference Shares.  This research is modified from time to time without notice and may express opinions or provide recommendations that are inconsistent with purchasing or holding the notes.  Even if our affiliates or Raymond James provides research that expresses a negative opinion about one or more of the Reference Shares, or if market conditions change, the composition of the Basket will not change during the term of the notes (except under the limited circumstances described below).  Any of these activities by us or one or more of our affiliates may affect the prices of the Reference Shares and, therefore, the market value of the notes.

 

As calculation agent, BMOCM will have the authority to make determinations that could affect the value of your notes and your payment at maturity.  As calculation agent for your notes, BMOCM will have discretion in making various determinations that affect your notes, including determining the Initial Share Prices, the Final Share Prices, the Basket Level Percentage, the Redemption Amount and whether any market disruption event has occurred.  The calculation agent also has discretion in making certain adjustments relating to mergers and certain other corporate transactions that a Reference Share Issuer may undertake.  The exercise of this discretion by BMOCM could adversely affect the value of your notes and may present BMOCM, which is our wholly owned subsidiary, with a conflict of interest.

 

The historical performance of the Reference Shares should not be taken as an indication of their future performance.  The Final Share Prices of the Reference Shares will determine the Redemption Amount.  The historical performance of the Reference Shares does not necessarily give an indication of their future performance.  As a result, it is impossible to predict whether the prices of the Reference Shares will rise or fall during the term of the notes.  The prices of the Reference Shares will be influenced by complex and interrelated political, economic, financial and other factors.

 

Holders of the Reference Shares are only entitled to receive those dividends as each issuer’s board of directors may declare out of funds legally available.  Although dividends and distributions on one or more of the Reference Shares may have historically been declared by the applicable board of directors, they are not required to do so and may reduce or eliminate those dividends in the future.  The Dividend Amount of one or more of the Reference Shares during the term of the notes may be zero.

 

One of the Reference Shares has only been publicly traded for a limited amount of time. As set forth below in the section “The Reference Shares,” one of the Reference Shares has only been publicly traded for a limited amount of time. Accordingly, it may be more difficult for you to evaluate the historical performance of that Reference Share than would be the case for Reference Shares with a longer trading history.

 

Significant aspects of the tax treatment of the notes are uncertain.  The tax treatment of the notes is uncertain.  We do not plan to request a ruling from the Internal Revenue Service or from any Canadian authorities regarding the tax treatment of the notes, and the Internal Revenue Service or a court may not agree with the tax treatment described in this pricing supplement.

 

Since a Reference Share is the type of financial asset described under Section 1260 of the Internal Revenue Code of 1986, as amended (the “Code”) (including, among others, any equity interest in pass-thru entities such as regulated investment companies (including certain exchange-traded funds), real estate investment trusts, partnerships, trusts, and passive foreign investment companies), while the matter is not entirely clear, an investment in the notes will likely, in whole or in part, be treated as a “constructive ownership transaction” to which Section 1260 of the Code applies.  If Section 1260 of the Code applies, all or a portion of any long-term capital gain recognized by a United States Holder in respect of the notes will be recharacterized as ordinary income and certain interest charges may apply.  See the section entitled “Supplemental Tax Considerations – Supplemental U.S. Federal Income Tax Considerations – Potential Application of Section 1260 of the Code.”

 

The Internal Revenue Service has issued a notice indicating that it and the Treasury Department are actively considering whether, among other issues, a holder should be required to accrue interest over the term of an instrument such as the notes even though that holder will not receive any payments with respect to the notes until maturity and whether all or part of the gain a holder may recognize upon sale or maturity of an instrument such as the notes could be treated as ordinary income.  The outcome of this process is uncertain and could apply on a retroactive basis.

 

 

Please read carefully the section entitled “Supplemental Tax Considerations” in this pricing supplement, the section “United States Federal Income Taxation” in the accompanying prospectus and the section entitled “Certain Income Tax Consequences” in the accompanying prospectus supplement.  You should consult your tax advisor about your own tax situation.

 

Insurance companies and employee benefit plans should carefully review the legal issues of an investment in the notes.  Any insurance company or fiduciary of a pension plan or other employee benefit plan that is subject to the prohibited transaction rules of the Employee Retirement Income Security Act of 1974, as amended, which we call “ERISA,” or the Internal Revenue Code of 1986, as amended (the “Code”), including an IRA or Keogh plan (or a governmental plan to which similar prohibitions apply), and that is considering purchasing the notes with the assets of the insurance company or the assets of such plan, should consult with its counsel regarding whether the purchase or holding of the notes could become a “prohibited transaction” under ERISA, the Code or any substantially similar prohibition in light of the representations a purchaser or holder in any of the above categories is deemed to make by purchasing and holding the notes.  These issues are discussed in more detail in the section “Employee Retirement Income Security Act” below.

 

Risks Relating to the Reference Shares

 

The inclusion of the Reference Shares in Raymond James’ Best Picks does not guarantee a positive return on the notes.  Raymond James’ process in creating the Best Picks for 2017 was to permit the analysts of its research department to each identify stocks that, at the time of the creation of the list, the analyst believes will be able to sustain operational growth and price appreciation over a 12 month period.  However, there can be no assurance that any Reference Share, or the Best Picks for 2017 in its entirety, will perform as intended.  The list of stocks on Best Picks for 2017 is not dynamic; if the analysts’ opinion of a Reference Share changes after the list is constituted, that change will not cause the deletion or addition of Reference Shares to the list.  While all of the securities that are included in the best picks list had a “strong buy” rating from Raymond James at the time of selection, there is no guarantee that those securities will retain that rating throughout the term of the notes.  The performance of the Reference Shares may be less than the performance of the equities markets generally, and less than the performance of specific sectors of the equity markets, or other securities in which you may choose to invest.  Although Raymond James has expressed a positive view as to the Reference Shares prior to the date of this pricing supplement, its views may change significantly during the term of the notes.  In addition, any positive views of Raymond James’ research division is separate and apart from the offering of these notes, and does not constitute investment advice.  Our offering of the notes does not constitute our recommendation or the recommendation of ours, Raymond James, or our respective affiliates to invest in the notes or in the Reference Shares.

 

You will not have any shareholder rights and will have no right to receive any Reference Shares at maturity.  Investing in the notes will not make you a holder of any of the Reference Shares.  Neither you nor any other holder or owner of the notes will have any voting rights, any right to receive dividends or other distributions (except to the extent that the Dividend Amounts are reflected in the Redemption Amount) or any other rights with respect to any of these securities.

 

Changes that affect a Reference Share may affect the market value of the notes and the amount you will receive at maturity.  Changes affecting a Reference Share or a Reference Share Issuer, such as reorganizations or mergers, will be reflected in the price of that Reference Share and therefore could affect the amount payable on your notes at maturity and the market value of the notes prior to maturity.  If these events occur, the calculation agent may adjust the applicable Initial Share Price.  See “Description of the Notes—Anti-dilution Adjustments.”

 

No Reference Share Issuer will have any role or responsibilities with respect to the notes.  None of the issuers of the Reference Shares will have authorized or approved the notes, or will be involved in this offering.  No such company will have any financial or legal obligation with respect to the notes or the amounts to be paid to you, including any obligation to take our needs or your needs into consideration for any reason, including taking any corporate actions that might affect the value of the Reference Shares or the notes.  No such company will receive any of the proceeds from any offering of the notes.  No Reference Share Issuer or any other company will be responsible for, or participate in, the determination or calculation of the Redemption Amount.

 

An investment in the notes may be subject to risks associated with non-U.S. securities markets.  Three of the Reference Shares, ARRIS International plc, Mylan N.V. and Willis Towers Watson Public Limited Company, were issued by a non-U.S. company or may be listed on a non-U.S. stock exchange, in addition to its U.S. listing.  Therefore, the return on the notes may be affected by factors affecting the value of securities in the relevant non-U.S. markets.  Non-U.S. securities markets may be more volatile than U.S. securities markets, and market developments may affect non-U.S. securities markets differently from the U.S. securities markets.  Direct or indirect government intervention to stabilize these non-U.S. securities markets, as well as cross shareholdings among non-U.S. companies, may affect trading prices and volumes in those markets.  In addition, non-U.S. companies are subject to accounting, disclosure, auditing and financial reporting standards and requirements that differ from those applicable to U.S. reporting companies.

 

 

Securities prices of non-U.S. companies are subject to political, economic, financial and social factors that may be unique to the particular country.  These factors, which could negatively affect the non-U.S. securities markets, include the possibility of recent or future changes in the economic and fiscal policies of non-U.S. governments, the possible imposition of, or changes in, currency exchange laws or other non-U.S. laws or restrictions applicable to non-U.S. companies or investments in non-U.S. equity securities, the possibility of fluctuations in the rate of exchange between currencies, the possibility of outbreaks of hostility and political instability and the possibility of natural disaster or adverse public health developments in the region.  Moreover, the economies of certain foreign countries may differ favorably or unfavorably from the U.S. economy in important respects, such as growth of gross national product, rate of inflation, trade surpluses or deficits, capital reinvestment, resources and self-sufficiency.

 

The return on the notes may be exposed to fluctuations in exchange rates that might affect the prices of the Reference Shares and the payment at maturity. Because one of the Reference Shares included in the Basket, Mylan N.V., in addition to its U.S. listing, trades in a currency other than U.S. dollars, and the notes are denominated in U.S. dollars, the amount payable on the notes at maturity may be exposed to fluctuations in the exchange rate between the U.S. dollar and the currency in which that Reference Share is denominated.  These changes in exchange rates may reflect changes in non-U.S. economies that in turn may affect the payment on the notes at maturity.

 

We do not control any Reference Share Issuer and we are not responsible for any disclosure made by any other company.  Neither we nor any of our affiliates have the ability to control the actions of any Reference Share Issuer, nor do we assume any responsibility for the adequacy or accuracy of any publicly available information about any of these companies, unless (and only to the extent that) our securities or the securities of our affiliates are represented by that Reference Share.  We are not responsible for any other issuer’s public disclosure of information on itself or any Reference Share, whether contained in U.S. Securities and Exchange Commission (the “SEC”) filings or otherwise.  We will not perform any due diligence procedures with respect to the applicable Reference Share Issuers.  You should make your own investigation into the Reference Share Issuers.

 

Industry consolidation and other corporate events may alter the composition of the Basket.  If a Reference Share Issuer is acquired in a stock-for-stock transaction, the stock of the acquiring company will assume that Reference Share’s place in the Basket, including if the stock of the acquiring company is already in the Basket.  Consequently, any consolidation among issuers of the Reference Shares will result in an increased weighting in the Basket for the surviving company.  The effects on the Basket and the Initial Share Prices of the Reference Shares of consolidation transactions and other reorganization events with respect to the Reference Shares are described in “Description of the Notes—Anti-dilution Adjustments.”

 

You will have limited anti-dilution protection with respect to the Reference Shares.  The calculation agent will adjust the Initial Share Price of a Reference Share for stock splits, reverse stock splits, stock dividends and other events that affect the applicable issuer’s capital structure, but only in the situations we describe in “Description of the Notes—Anti-dilution Adjustments” below.  The calculation agent will not be required to make an adjustment for every corporate event that may affect a Reference Share.  For example, the calculation agent will not make any adjustments for events such as an offering by a Reference Share Issuer of equity securities or a tender or exchange offer for less than all outstanding shares of that issuer by a third party.  Those events or other actions by the applicable issuer or a third party may nevertheless adversely affect the price of the Reference Share, and adversely affect the value of your notes.

 

 

DESCRIPTION OF THE NOTES

 

This pricing supplement, and the accompanying prospectus dated June 27, 2014 relating to the notes, should be read together.  Because the notes are part of a series of our senior debt securities called Senior Medium-Term Notes, Series C, this pricing supplement and the accompanying prospectus should also be read together with the accompanying prospectus supplement, dated June 27, 2014.  Terms used but not defined in this pricing supplement have the meanings given to them in the accompanying prospectus or accompanying prospectus supplement, unless the context requires otherwise.

 

The notes will be issued in book-entry form through The Depository Trust Company.  Owners of beneficial interests in the notes should read the section entitled “Description of the Notes We May Offer—Legal Ownership” in the accompanying prospectus supplement and “Description of Debt Securities We May Offer—Legal Ownership and Book-Entry Issuance” in the accompanying prospectus.

 

The notes are part of a series of senior debt securities entitled “Senior Medium-Term Notes, Series C” that we may issue from time to time under the senior indenture, dated January 25, 2010, between Bank of Montreal and Wells Fargo Bank, National Association, as trustee.  Terms that apply generally to our medium term notes are described in “Description of the Notes We May Offer” in the accompanying prospectus supplement.  The terms described in this pricing supplement, supplement those described in the accompanying prospectus and the accompanying prospectus supplement, and, if the terms described here are inconsistent with those described in those documents, the terms described in this pricing supplement are controlling.

 

We will not pay periodic interest payments on the notes.

 

Composition of the Basket

 

The Basket is composed of 17 Reference Shares, which are the securities included in Raymond James Analysts’ Best Picks for 2017.  The Reference Shares will not change over the term of the notes, except in limited circumstances relating to corporate events that may affect the Reference Shares, as described below.

 

Payment at Maturity

 

The amount that you will receive at maturity for each $1,000 in principal amount of the notes (the “Redemption Amount”) will depend upon the performance of the Basket and the dividends paid on the Reference Shares. The Redemption Amount will equal:

 

($1,000 × the Basket Level Percentage × the Participation Rate)

 

Basket Level Percentage.  The Basket Level Percentage will equal the sum of the Weighted Reference Share Performances.

 

Weighted Reference Share Performance.  For each Reference Share, the product of (a) its Reference Share Performance and (b) its Reference Share Weighting.

 

Reference Share Performance.  The Reference Share Performance will measure the change in value of each Reference Share over the term of the notes, including the payment of certain dividends. For each Reference Share, the Reference Share Performance will equal (a) the applicable Final Share Price divided by (b) the applicable Initial Share Price, expressed as a percentage.

    

Average Intra-Day Price.  With respect to each Reference Share and any averaging date, the arithmetic mean of the prices at which we or any of our affiliates (which may include the calculation agent) acquires, establishes, reestablishes, substitutes, maintains, unwinds or disposes of, as the case may be, of any transactions or assets relating to that Reference Share as we deem necessary to hedge our obligations with respect to the notes.

 

 

Final Share Price.  For each Reference Share, the sum of (a) the arithmetic mean of the closing prices on each valuation date, and (b) the Dividend Amount for that Reference Share.

 

Dividend Amount.  An amount in U.S. dollars equal to 100% of the gross cash distributions (including ordinary and extraordinary dividends) per Reference Share declared by the applicable Reference Share Issuer where the date that the applicable Reference Share has commenced trading ex-dividend on its primary U.S. securities exchange as to each relevant distribution occurs from (and including) the second averaging date to (and including) the final valuation date, as determined by the calculation agent, and subject to the following limitations:

 

·

with respect to any distribution where the date that the applicable Reference Share commences trading ex-dividend on the second averaging date, only 1/4 of the applicable distribution shall be included;

 

·

with respect to any distribution where the date that the applicable Reference Share commences trading ex-dividend on the third averaging date, only 2/4 of the applicable distribution shall be included;

 

·

with respect to any distribution where the date that the applicable Reference Share commences trading ex-dividend on the fourth averaging date, only 3/4 of the applicable distribution shall be included;

 

·

with respect to any distribution where the date that the applicable Reference Share commences trading ex-dividend on the second valuation date, only 3/4 of the applicable distribution shall be included;

 

·

with respect to any distribution where the date that the applicable Reference Share commences trading ex-dividend on the third valuation date, only 2/4 of the applicable distribution shall be included; and

 

·

with respect to any distribution where the date that the applicable Reference Share commences trading ex-dividend on the fourth valuation date, only 1/4 of the applicable distribution shall be included.

 

As to each Reference Share Issuer that is organized outside of the U.S. (ARRIS International plc, Mylan N.V. and Willis Towers Watson Public Limited Company), each Dividend Amount may be reduced by (a) a “Net Percentage” and (b) the calculation agent’s reasonable estimate of any issuance fee that would apply to a hypothetical U.S. holder of the applicable Reference Share, which such issuance fee we do not expect to exceed 12% of the amount of the relevant dividend).  These reductions are designed to reflect the approximate net portion of a dividend that a hypothetical holder of the Reference Share would receive after giving effect to applicable withholding taxes of the relevant jurisdictions and any issuance fees.  However, there can be no assurance that these reductions would reflect the actual amounts received by any holder of the applicable Reference Shares.  The Net Percentages are up to 5% as to ARRIS International plc, up to 15% as to Mylan N.V., and up to 20% as to Willis Towers Watson Public Limited Company.

 

Valuation Dates

 

The valuation dates will occur on four trading days occurring shortly before the maturity date.  The scheduled valuation dates are: December 14, 2017, December 15, 2017, December 18, 2017 and December 19, 2017.  If any valuation date is not a trading day as to any Reference Share, that valuation date will be postponed as to that Reference Share to the next trading day (and each subsequent valuation date will be similarly postponed).  If the calculation agent determines that a market disruption event occurs or is continuing on any valuation date, the Final Share Price of the applicable Reference Share or Reference Shares will be determined according to the calculation in “—Consequences of Market Disruption Events” below.

 

Maturity Date

 

The maturity date will be December 21, 2017, unless that date is not a business day, in which case the maturity date will be the next following business day.  The maturity date will be postponed by the same number of business days as the final valuation date may be postponed, as provided herein, and no interest will be payable as a result of any such postponement.

 

Certain Definitions

 

Business Day.  A day of the week other than Saturday or Sunday that is neither a legal holiday nor a day on which banking institutions are authorized or obligated by law or executive order to close in New York City, Toronto, or Montreal.

 

Trading Day.  As to any Reference Share, any day, as determined by the calculation agent, on which trading is generally conducted on the relevant primary U.S. exchange for that Reference Share.

 

 

Closing Price.  The closing price for any Reference Share on any day will equal the closing sale price or last reported sale price, regular way, for the security, on a per-share basis:

 

·

on the principal national securities exchange on which that Reference Share is listed for trading on that day, or

 

·

if that Reference Share is not listed on any national securities exchange on that day, on any other market system or quotation system that is the primary market for the trading of that Reference Share.

 

If that Reference Share is not listed or traded as described above, then the closing price for that Reference Share on any day will be the average, as determined by the calculation agent, of the bid prices for the security obtained from as many dealers in that security selected by the calculation agent as will make those bid prices available to the calculation agent.  The number of dealers need to exceed three and may include the calculation agent, Raymond James, or any of their respective affiliates.

 

Consequences of Market Disruption Events

    

Any of the following will be a “market disruption event” as to any Reference Share:

 

·

a suspension, absence or limitation of trading in (i) that security in its primary market, as determined by the calculation agent, or (ii) futures or options contracts relating to that security in the primary market for those contracts, as determined by the calculation agent;

 

·

any event that disrupts or impairs, as determined by the calculation agent, the ability of market participants to (i) effect transactions in, or obtain market values for, the security in its primary market, or (ii) effect transactions in, or obtain market values for, futures or options contracts relating to that security in its primary market;

 

·

the closure on any day of the primary market for that security on a scheduled trading day prior to the scheduled weekday closing time of that market (without regard to after hours or any other trading outside of the regular trading session hours) unless such earlier closing time is announced by the primary market at least one hour prior to the earlier of (i) the actual closing time for the regular trading session on such primary market on such scheduled trading day for such primary market and (ii) the submission deadline for orders to be entered into the relevant exchange system for execution at the close of trading on such scheduled trading day for such primary market;

 

·

any scheduled trading day on which (i) the primary market for that security or (ii) the exchanges or quotation systems, if any, on which futures or options contracts on that security are traded, fails to open for trading during its regular trading session; or

 

·

any other event, if the calculation agent determines that the event interferes with our ability or the ability of any of our affiliates to unwind all or a portion of a hedge with respect to the notes that we or our affiliates have effected or may effect as described below under “Use of Proceeds and Hedging” in this pricing supplement.

 

Anti-dilution Adjustments

 

The calculation agent will adjust the Initial Share Price for any Reference Share if any of the dilution events described below occurs with respect to that Reference Share.

 

The calculation agent will adjust the Initial Share Price for any Reference Share as described below, but only if an event described below under this “—Anti-dilution Adjustments” section occurs with respect to that Reference Share and only if the relevant event occurs during the period described under the applicable subsection.  The Initial Share Price for each Reference Share will be subject to the adjustments described below, independently and separately, with respect to the dilution events that affect that Reference Share.

 

 

If more than one anti-dilution event requiring adjustment occurs with respect to the Initial Share Price for any Reference Share, the calculation agent will adjust the Initial Share Price of that Reference Share for each event, sequentially, in the order in which the events occur, and on a cumulative basis.  As a result, having adjusted the Initial Share Price for a Reference Share for the first event, the calculation agent will adjust the Initial Share Price for that same Reference Share for the second event, applying the required adjustment to the Initial Share Price as already adjusted for the first event, and so on for each event.  If an event requiring an anti-dilution adjustment occurs, the calculation agent will make the adjustment in an attempt to offset, to the extent practical, any change in the economic position of the holder and us, relative to your note, that results solely from that event.  The calculation agent may also adjust the Initial Share Price, the Final Share Price or the Dividend Amount of the applicable Reference Share in order to ensure an appropriate result.  The calculation agent may, in its sole discretion, modify the anti-dilution adjustments set forth in this section as necessary to ensure an equitable result.

 

Stock Splits and Stock Dividends

 

A stock split is an increase in the number of a corporation’s outstanding shares of stock without any change in its stockholders’ equity.  When a corporation pays a stock dividend, it issues additional shares of its stock to all holders of its outstanding stock in proportion to the shares they own.  Each outstanding share will be worth less as a result of a stock split or stock dividend.

 

If a Reference Share is subject to a stock split or receives a stock dividend, then the calculation agent will adjust its Initial Share Price by dividing the prior Initial Share Price — that is, the Initial Share Price before the stock split or stock dividend — by an amount equal to: (1) the number of shares of the applicable Reference Share outstanding immediately after the stock split or stock dividend becomes effective; divided by (2) the number of shares of the applicable Reference Share outstanding immediately before the stock split or stock dividend becomes effective.  The Initial Share Price for a Reference Share will not be adjusted, however, unless:

 

·

in the case of a stock split, the first day on which that Reference Share trades without the right to receive the stock split occurs after the averaging dates and on or before the applicable valuation date; or

 

·

in the case of a stock dividend, the ex-dividend date occurs after the averaging dates and on or before the applicable valuation date.

 

The ex-dividend date for any dividend or other distribution with respect to a Reference Share is the first day on which that Reference Share trades without the right to receive that dividend or other distribution.

 

Reverse Stock Splits

 

A reverse stock split is a decrease in the number of a corporation’s outstanding shares of stock without any change in its stockholders’ equity.  Each outstanding share will be worth more as a result of a reverse stock split.

 

If a Reference Share is subject to a reverse stock split, then the calculation agent will adjust its Initial Share Price by multiplying the prior Initial Share Price by an amount equal to: (a) the number of shares of that Reference Share outstanding immediately before the reverse stock split becomes effective; divided by (b) the number of shares of that Reference Share outstanding immediately after the reverse stock split becomes effective.  The Initial Share Prices of a Reference Share will not be adjusted, however, unless the reverse stock split becomes effective after the averaging date and on or before the first valuation date.

 

Transferable Rights and Warrants

 

If the Reference Share Issuer issues transferable rights or warrants to all holders of that Reference Share to subscribe for or purchase that Reference Share at an exercise price per share that is less than the closing price of the Reference Share on the business day before the ex-dividend date for the issuance, then the applicable Initial Share Price will be adjusted by multiplying the prior Initial Share Price by the following fraction:

 

·

the numerator will be the number of shares of that Reference Share outstanding at the close of business on the day before that ex-dividend date plus the number of additional shares of that Reference Share that the aggregate offering price of the total number of shares of the applicable Reference Share so offered for subscription or purchase pursuant to the transferable rights or warrants could purchase at the closing price on the business day before the ex-dividend date, with that number of additional shares being determined by multiplying the total number of shares so offered by the exercise price of those transferable rights or warrants and dividing the resulting product by the closing price on the business day before that ex-dividend date.

 

 

·

the denominator will be the number of shares of that Reference Share outstanding at the close of business on the day before that ex-dividend date plus the number of additional shares of the applicable Reference Share offered for subscription or purchase under those transferable rights or warrants.

 

The Initial Share Price will not be adjusted, however, unless the ex-dividend date described above occurs after the averaging dates and on or before the applicable valuation date.

 

Reorganization Events

 

If a Reference Share Issuer undergoes a reorganization event in which property other than the applicable Reference Share — e.g., cash and securities of another issuer — is distributed in respect of that Reference Share, then, for purposes of calculating its Reference Share Performance, the calculation agent will determine the closing price of that Reference Share on each valuation date to equal the value of the cash, securities and other property distributed in respect of one share of that Reference Share.

 

If the calculation agent determines that, by valuing such cash, securities and other property, a commercially reasonable result is not achieved, then the calculation agent will, in its sole discretion, substitute another stock for that Reference Share.

 

Each of the following is a reorganization event with respect to a Reference Share:

 

·

the Reference Share is reclassified or changed;

 

·

the Reference Share Issuer has been subject to a merger, consolidation or other combination and either is not the surviving entity or is the surviving entity but all the outstanding stock is exchanged for or converted into other property;

 

·

a statutory share exchange involving the outstanding stock and the securities of another entity occurs, other than as part of an event described in the two bullet points above;

 

·

the Reference Share Issuer sells or otherwise transfers its property and assets as an entirety or substantially as an entirety to another entity;

 

·

the Reference Share Issuer effects a spin-off — that is, issues to all holders of that Reference Share equity securities of another issuer, other than as part of an event described in the four bullet points above;

 

·

the Reference Share Issuer is liquidated, dissolved or wound up or is subject to a proceeding under any applicable bankruptcy, insolvency or other similar law; or

 

·

another entity completes a tender or exchange offer for all of the outstanding stock of the Reference Share Issuer.

 

Valuation of Distribution Property

 

If a reorganization event occurs with respect to a Reference Share, and the calculation agent does not substitute another stock for that Reference Share as described in “—Substitution” below, then the calculation agent will determine the applicable closing price on each valuation date so as to equal the value of the property — whether it be cash, securities or other property — distributed in the reorganization event in respect of one share of that Reference Share, as that Reference Share existed before the date of the reorganization.  We refer to the property distributed in a reorganization event as distribution property, a term we describe in more detail below.  The calculation agent will not make any determination for a reorganization event, however, unless the event becomes effective (or, if the event is a spin-off, unless the ex-dividend date for the spin-off occurs) after the averaging dates and on or before the applicable valuation date.

 

For the purpose of making a determination required by a reorganization event, the calculation agent will determine the value of each type of distribution property, in its sole discretion.  For any distribution property consisting of a security, the calculation agent will use the closing price for the security on the relevant date.  The calculation agent may value other types of property in any manner it determines, in its sole discretion, to be appropriate.  If a holder of a Reference Share may elect to receive different types or combinations of types of distribution property in the reorganization event, the distribution property will consist of the types and amounts of each type distributed to a holder that makes no election, as determined by the calculation agent in its sole discretion.

 

 

If a reorganization event occurs and the calculation agent adjusts the closing price of a Reference Share on a valuation date to equal the value of the distribution property distributed in the event, as described above, the calculation agent will make further determinations for later events that affect the distribution property considered in determining the closing price.  The calculation agent will do so to the same extent that it would make determinations if that Reference Share were outstanding and were affected by the same kinds of events.

 

For example, if a Reference Share Issuer merges into another company and each share of that Reference Share is converted into the right to receive two common shares of the surviving company and a specified amount of cash, then on each valuation date the closing price of that Reference Share will be determined to equal the value of the two common shares of the surviving company plus the specified amount of cash.  The calculation agent will further determine the common share component of that closing price to reflect any later stock split or other event, including any later reorganization event, that affects the common shares of the surviving company, to the extent described in this “—Anti-dilution Adjustments” section or as described above in the “—Reorganization Events” subsection as if the common shares were that Reference Share.  In that event, the cash component will not be redetermined but will continue to be a component of the closing price.

 

When we refer to “distribution property,” we mean the cash, securities and other property distributed in a reorganization event in respect of a Reference Share.  If an adjustment resulting from a prior reorganization had occurred, the “distribution property” will mean the cash, securities and other property distributed in respect of any securities whose value determines the closing price of the Reference Share on a valuation date.  In the case of a spin-off, the distribution property also includes the Reference Share in respect of which the distribution is made.

 

If a reorganization event occurs, the distribution property distributed in the event will be substituted for the Reference Share as described above.  Consequently, in this pricing supplement, when we refer to a Reference Share, we mean any distribution property that is distributed in a reorganization event in respect of that Reference Share.  Similarly, when we refer to a Reference Share Issuer, we mean any successor entity in a reorganization event.

 

Substitution

 

If the calculation agent determines that a commercially reasonable result is not achieved by valuing distribution property with respect to the applicable Reference Share upon becoming subject to a reorganization event, then the calculation agent will, in its sole discretion, substitute another stock for that Reference Share.  In such case, the adjustments described above under “—Valuation of Distribution Property” will not apply.

 

If the calculation agent so determines, it may choose, in its sole discretion, the stock of a different company listed on a national securities exchange as a substitute for that Reference Share.  For all purposes, the substitute stock will be deemed to be that Reference Share for all purposes of the notes.  The calculation agent will determine, in its sole discretion, the Initial Share Price, the Dividend Amount and/or the manner of valuation of the substitute stock.  The calculation agent will have the right to make such adjustments to the calculation of the applicable Reference Share Performance and Dividend Amount as it determines in its sole discretion are necessary to preserve as nearly as possible our and your relative economic position prior to the reorganization event.

 

Other Events and Adjustments

 

The calculation agent may make such adjustments to the terms of the notes with respect to any of the events described above, as it deems in its discretion is necessary to ensure an equitable result, for example, if an event of the type described in this section occurs on an averaging date or on a valuation date.

 

Other Events and Adjustments

 

The calculation agent may make such adjustments to the terms of the notes with respect to any of the events described above, as it deems in its discretion is necessary to ensure an equitable result, for example, if an event of the type described in this section occurs on an averaging date or on a valuation date.

 

Events of Default

 

In case an event of default with respect to the notes shall have occurred and be continuing, the amount declared due and payable on the notes upon any acceleration of the notes will be determined by the calculation agent and will be an amount of cash equal to the amount payable as described under the caption “—Payment at Maturity,” calculated as if the date of acceleration were the final valuation date.  The Dividend Amount for each Reference Share will only include dividends declared and paid through that date.

 

If the maturity of the notes is accelerated because of an event of default, we will, or will cause the calculation agent to, provide written notice to the trustee at its New York office, on which notice the trustee may conclusively rely, and to the depositary, of the amount due with respect to the notes as promptly as possible and in no event later than two business days after the date of acceleration.

 

 

Role of the Calculation Agent

 

The calculation agent will make all determinations regarding the prices of the Reference Shares, the Redemption Amount, the Dividend Amounts of the Reference Shares, trading days, business days, market disruption events, any required anti-dilution adjustments, the default amount, and the amounts payable on your notes.  Absent manifest error, all determinations of the calculation agent will be final and binding on you and us, without any liability on the part of the calculation agent.  You will not be entitled to any compensation from us for any loss suffered as a result of any of the above determinations or calculations by the calculation agent.

 

Our subsidiary, BMOCM, is expected to serve as the calculation agent for the notes.  We may change the calculation agent for your notes at any time after the date of this pricing supplement without notice and BMOCM may resign as calculation agent at any time upon 60 days written notice to us.

 

Listing

 

Your notes will not be listed on any securities exchange.

 

 

RAYMOND JAMES ANALYSTS’ BEST PICKS FOR 2017

 

 

The Basket is composed of publicly traded common stocks selected by the Equity Research Department at Raymond James as the “Raymond James Analysts’ Best Picks^® for 2017.”  Every year since December 1995, the equity research department at Raymond James has selected its best picks for the following calendar year.  The best picks list is a static list announced in December for the following calendar year.

 

The goal in selecting the Best Picks for 2017 was to identify stocks that will be able to sustain operational growth and price appreciation over a 12 month period.  Only certain stocks covered by certain analysts in the Raymond James Equity Research Department can be considered for selection as a Best Pick.  In order to be included in the Raymond James Analysts’ Best Picks^®, stocks must have satisfied certain criteria, including without limitation, the following:

 

·

the stock must have been recommended by an equity research analyst that has at least two years of sell-side research experience following the industry as a lead analyst;

 

·

the stock must have been rated a “strong buy” at the time of selection;

 

·

only one stock per analyst and only one choice per industry is allowed;

 

·

no company may be on the list for more than two consecutive years;

 

·

the market capitalization of the company must have been at least $1,000,000,000;

 

·

the stock price must have been greater than $10.00 per share, and if under $20.00 per share, then the market capitalization of the company must have been at least $1,500,000,000;

 

·

the stocks selected must have had an average daily trading value of at least $10,000,000 over the last 20 trading days; and

 

·

Raymond James Equity Research Department must have determined that there is a relatively high probability of the company beating the current consensus 2017 earnings per share (“EPS”) or earnings before interest, taxes, depreciation and amortization (“EBITDA”) forecasts, which was derived from different information providers.  If the company’s current consensus 2017 EPS was expected to be negative, the 2017 EBITDA estimate must have represented a significant increase.

 

The composition of the Basket and the identity of the Reference Shares were selected by the Raymond James Equity Research Department.  Neither we nor our affiliates take any responsibility for the selection of the Basket and the identity of the Reference Shares or otherwise endorses such stocks and none of such entities (or Raymond James) makes any representation as to the performance of any Reference Share or the Basket.  All of the stocks that are included in the best picks list had a “strong buy” rating at the time of selection; however, there is no guarantee that the stocks will retain that rating throughout the term of the notes.

 

There are a number of risks that will affect each of the companies that comprise the Best Picks, including industry specific risks, risks relating to major competitors or new product expectations, unforeseen developments with respect to the management, financial condition or accounting policies or practices of the company, and external factors that could affect the U.S. economy, interest rates, the U.S. dollar or particular segments of the economy.  Any of these changes may have an adverse effect on the company, the performance of its stock, investor confidence in the stock and the company’s business prospects.  Please see “Additional Risk Factors— Risks Relating to the Reference Shares—The inclusion of the Reference Shares in Raymond James’ Best Picks does not guarantee a positive return on the notes” in this pricing supplement.

 

The information in this section has been provided by Raymond James.

 

 

DESCRIPTION OF THE REFERENCE SHARES

 

 

Companies with securities registered under the Exchange Act, are required to file financial and other information specified by the SEC periodically.  Information provided to or filed with the SEC can be inspected or copied at the SEC’s public reference room located at 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates.  You may obtain information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330.  In addition, information provided to or filed with the SEC by each Reference Share Issuer under the Exchange Act can be located through the SEC’s website at http://www.sec.gov.

 

This pricing supplement relates only to the notes offered hereby and does not relate to any Reference Shares or other securities of any Reference Share Issuer.  We derived all disclosures in this pricing supplement regarding the Reference Share Issuers from publicly available documents described in the preceding paragraph.  In connection with the offering of the notes, none of us, Raymond James, or our respective affiliates have participated in the preparation of such documents or made any due diligence inquiry with respect to any Reference Share Issuer.  None of us, Raymond James, or any of our respective affiliates makes any representation that such publicly available documents or any other publicly available information regarding any Reference Share Issuer is current, accurate or complete.  None of such documents shall be deemed to be incorporated by reference into this pricing supplement.

 

The composition of the Basket and the identity of the Reference Shares were selected by the Raymond James Equity Research Department.  Neither we nor our affiliates take any responsibility for the selection of the Basket and the identity of the Reference Shares or otherwise endorses those stocks and none of those entities makes any representation as to the performance of any Reference Share or the Basket.

 

The Equity Research Department at Raymond James & Associates, Inc. regularly publishes research regarding equity securities.  The Reference Shares have been selected from among the companies covered by the Equity Research Department or the research division of one or more investment banks with which Raymond James has a research relationship.  However, we note that these are only research views based on currently available information.  There is no assurance that any particular company will be successful.  Moreover, the business, results of operations, and prospects of these companies are subject to conditions outside of the control of the Equity Research Department, such as general economic conditions.

 

Additional information regarding Raymond James research analyst ratings is available at http://www.raymondjames.com/rsch_how.htm.  Information on that website is not included or incorporated by reference in this document.  A rating is subject to downward revision at any time, and a broker-dealer may cease to cover a particular security at any time, including during the term of the notes.

 

The information in the above two paragraphs has been provided by Raymond James.

 

The composition of the Basket and the identity of the Reference Shares were selected by the Equity Research Department.  Neither we nor our affiliates take any responsibility for the selection of the Basket or the identity of the Reference Shares or otherwise endorses such stocks and none of such entities (or Raymond James) makes any representation as to the performance of any Reference Share or the Basket.

 

License Agreement

 

We have entered into a license agreement with Raymond James, under which we have obtained the right to use the stocks discussed herein in connection with our issuance of the notes.  Under the license agreement, we have agreed to pay Raymond James a fee equal to 0.72% of the principal amount of the notes.

 

The license agreement requires this section to state as follows:

 

Solely by participating in this offering, Raymond James makes no representation or warranty, express or implied, to the owners of the notes or any member of the public regarding the advisability of investing in securities generally or in the notes particularly or the ability of the Basket to track general or industry-specific stock market performance.  Raymond James and its third party licensors have no obligation to take the needs of Bank of Montreal or the owners of the notes into consideration in determining, composing or calculating the Basket.  BMOCM is calculation agent for the notes and will have discretion in making various determinations that affect the notes and Raymond James is not responsible for any such calculations or determinations.  Raymond James has no obligation or liability in connection with the administration or trading of the notes.

 

Raymond James has licensed certain of its trademarks to us.

 

The mark “RAYMOND JAMES” is a trademark of Raymond James & Associates, Inc. and/or its affiliates, and has been licensed for our use.

 

 

THE REFERENCE SHARES

 

ARRIS International PLC

 

ARRIS International plc manufactures and supplies communications equipment. The company offers video infrastructure, delivery networks, home and business connectivity and devices, and related products. Its ordinary shares trade on the Nasdaq Global Select Market under the symbol “ARRS.”

 

Historical Information of the Common Stock of ARRIS International PLC

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Avnet, Inc.

 

Avnet, Inc. distributes computer products and semiconductors, as well as interconnect, passive, and electromechanical components. The company markets and distributes these products and provides supply-chain integration, engineering design, and technical services. Its common stock trades on the New York Stock Exchange (“NYSE”) under the symbol “AVT.”

 

Historical Information of the Common Stock of Avnet, Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

CyrusOne Inc.

 

CyrusOne Inc. is an owner, operator, and developer of enterprise-class, carrier-neutral data center properties. Its common stock trades on the Nasdaq Global Select Market under the symbol “CONE.”

 

Historical Information of the Common Stock of CyrusOne Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2013 through December 16, 2016.

 

 

 

Halliburton Company

 

Halliburton Company provides energy services and engineering and construction services, as well as manufactures products for the energy industry. The company offers services and products and integrated solutions to customers in the exploration, development, and production of oil and natural gas. Its common stock trades on the NYSE under the symbol “HAL.”

 

Historical Information of the Common Stock of Halliburton Company

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Mohawk Industries, Inc.

 

Mohawk Industries, Inc. designs, manufactures, sources, distributes and markets flooring for residential and commercial applications. The company offers carpet, ceramic tile, laminate, wood, stone, vinyl, and rugs. The company markets residential and commercial flooring in the United States, and residential flooring in Europe.  Its common stock trades on the NYSE under the symbol “MHK.”

 

Historical Information of the Common Stock of Mohawk Industries, Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Monolithic Power Systems, Inc.

 

Monolithic Power Systems, Inc. specializes in high-performance and integrated power solutions. The company provides small, energy efficient, and easy-to-use power solutions for systems found in industrial applications, telecom infrastructures, cloud computing, automotive and consumer applications. Its common stock trades on the Nasdaq Global Select Market under the symbol “MPWR.”

 

Historical Information of the Common Stock of Monolithic Power Systems, Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Marathon Oil Corporation

 

Marathon Oil Corporation is an independent international energy company engaged in exploration and production, oil sands mining, and integrated gas. The company's operations are focused in North America, Africa, and Europe. Its common stock trades on the NYSE under the symbol “MRO.”

 

Historical Information of the Common Stock of Marathon Oil Corporation

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Microsoft Corporation

 

Microsoft Corporation develops, manufactures, licenses, sells, and supports software products. The company offers operating system software, server application software, business and consumer applications software, software development tools, and Internet and intranet software. The company also develops video game consoles and digital music entertainment devices. Its common stock trades on the Nasdaq Global Select Market under the symbol “MSFT.”

 

Historical Information of the Common Stock of Microsoft Corporation

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Mylan N.V.

 

Mylan N.V. is a global generic and specialty pharmaceuticals company. The company operates an active pharmaceutical ingredient manufacturer and runs a specialty business focused on respiratory, allergy, and psychiatric therapies. Its ordinary shares trade on the Nasdaq Global Select Market under the symbol “MYL.”

 

Historical Information of the Common Stock of Mylan N.V.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Newell Brands Inc.

 

Newell Brands Inc. retails consumer products. The company offers housewares, home furnishings, office supplies, tools and hardware, and hair accessories. The company markets its products in the United States. Its common stock trades on the NYSE under the symbol “NWL.”

 

Historical Information of the Common Stock of Newell Brands Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Oasis Petroleum Inc.

 

Oasis Petroleum Inc. is an independent exploration and production company focused on the acquisition and development of unconventional oil and natural gas resources. Its common stock trades on the NYSE under the symbol “OAS.”

 

Historical Information of the Common Stock of Oasis Petroleum Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the second quarter of 2010 through December 16, 2016.

 

 

 

O’Reilly Automotive, Inc.

 

O'Reilly Automotive, Inc. retails and supplies automotive aftermarket parts, tools, supplies, equipment, and accessories. The company sells its products to do-it-yourself customers and professional mechanics or service technicians. The company operates stores throughout the United States. Its common stock trades on the Nasdaq Global Select Market under the symbol “ORLY.”

 

Historical Information of the Common Stock of O’Reilly Automotive, Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Bank of the Ozarks, Inc.

 

Bank of the Ozarks, Inc. is the holding company for the Bank of the Ozarks. The company provides a range of retail and commercial banking services to businesses, individuals, and government agencies through the company's banking offices located throughout Arkansas, Georgia, Texas, Florida, Alabama, North Carolina and South Carolina. Its common stock trades on the Nasdaq Global Select Market under the symbol “OZRK.”

 

Historical Information of the Common Stock of Bank of the Ozarks, Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Roper Technologies, Inc.

 

Roper Technologies, Inc. manufactures and distributes industrial equipment. The company offers industrial controls, fluid handling, pumps, medical and scientific devices, analytical instrumentation products, radio frequency identification (RFID) communication technology, and software solutions. Its common stock trades on the NYSE under the symbol “ROP.”

 

Historical Information of the Common Stock of Roper Technologies, Inc.

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

UnitedHealth Group Incorporated

 

UnitedHealth Group Incorporated owns and manages organized health systems in the United States and internationally. The company provides employers products and resources to plan and administer employee benefit programs. The company also serves the health needs of older Americans, provides specialized care services, and provides health care information and research to providers and payers. Its common stock trades on the NYSE under the symbol “UNH.”

 

Historical Information of the Common Stock of UnitedHealth Group Incorporated

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Willis Towers Watson Public Limited Company

 

Willis Towers Watson Public Limited Company provides a range of insurance brokerage, reinsurance, and risk management consulting services. Its ordinary shares trade on the Nasdaq Global Select Market under the symbol “WLTW.”

 

Historical Information of the Common Stock of Willis Towers Watson Public Limited Company

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.

 

 

 

Wintrust Financial Corporation

 

Wintrust Financial Corporation is a multi-bank holding company providing community-based banking services in various suburbs of Chicago, Illinois. The company provides a variety of commercial and personal financial services to individuals, businesses, local governmental units, and institutions. The company also has a financing services subsidiary and a trust subsidiary. Its common stock trades on the Nasdaq Global Select Market under the symbol “WTFC.”

 

Historical Information of the Common Stock of Wintrust Financial Corporation

 

The following table sets forth the high and low closing prices of this Reference Share from the first quarter of 2008 through December 16, 2016.