Obligation Montreal Bank 4.8% ( US06368B5P91 ) en USD

Montreal Bank

99.98 % ▲

Canada

US06368B5P91 ( en USD )

4.8% par an ( paiement semestriel )

Perpétuelle

Prospectus brochure de l'obligation Bank of Montreal US06368B5P91 en USD 4.8%, échéance Perpétuelle

06368B5P9

BBB- ( Qualité moyenne inférieure )

25/08/2025 ( Dans 55 jours )

La Banque de Montréal (BMO) est une institution financière multinationale canadienne offrant une vaste gamme de services bancaires de détail, de gestion de patrimoine, de marchés des capitaux et de services bancaires aux entreprises à l'échelle mondiale.

L'Obligation émise par Montreal Bank ( Canada ) , en USD, avec le code ISIN US06368B5P91, paye un coupon de 4.8% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le Perpétuelle
L'Obligation émise par Montreal Bank ( Canada ) , en USD, avec le code ISIN US06368B5P91, a été notée BBB- ( Qualité moyenne inférieure ) par l'agence de notation Standard & Poor's ( S&P ).

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424B2 1 d781685d424b2.htm 424B2
Table of Contents
Registration Statement No. 333-217200
Filed pursuant to Rule 424(b)(2)

PROSPECTUS SUPPLEMENT dated July 23, 2019
(to prospectus dated April 27, 2017)

US$500,000,000
4.800% Fixed Rate Resetting Non-Cumulative
Subordinated Additional Tier 1 Capital Notes
(Non-Viability Contingent Capital (NVCC))
(Subordinated Indebtedness)
We are offering US$500,000,000 aggregate principal amount of 4.800% Fixed Rate Resetting Non-Cumulative Subordinated Additional Tier 1 Capital Notes (Non-Viability
Contingent Capital (NVCC)) (the "Notes"). The Notes have no scheduled maturity or scheduled redemption date. From and including July 30, 2019, to, but excluding, August 25,
2024 (the "First Reset Date), interest will accrue on the Notes at an initial rate equal to 4.800% per annum. Thereafter, for each period commencing on a Reset Date (as defined
herein), from and including such Reset Date to, but excluding the following Reset Date, interest will accrue on the Notes at a rate per annum equal to the applicable Treasury Yield
(as defined herein) plus 2.979%. Subject to our right to cancel interest payments (as described below), interest on the Notes will be payable semi-annually in arrears on February 25
and August 25 of each year (each, an "Interest Payment Date"), commencing on February 25, 2020.
The Notes are intended to qualify as our additional Tier 1 capital within the meaning of the regulatory capital adequacy requirements to which we are subject. The
Notes have no scheduled maturity and holders do not have the right to call for their redemption. Interest will be due and payable on an Interest Payment Date only if it is
not cancelled. Any cancelled interest payments will not be cumulative. We have the sole and absolute discretion at all times and for any reason to cancel (in whole or in
part), with notice to the holders of the Notes, any interest payment that would otherwise be payable on any Interest Payment Date. Accordingly, you may not receive any
interest on any Interest Payment Date or at any other times and we are not required to make any repayment of the principal amount of the Notes except if an Event of
Default (as defined herein) has occurred and provided that an NVCC Automatic Conversion (as defined herein) has not occurred. As a result, you could lose part or all of
your investment in the Notes.
Upon the occurrence of a Trigger Event (as defined herein), each outstanding Note will automatically and immediately be converted, on a full and permanent basis, without the
consent of the holders thereof, into fully-paid and freely tradable common shares of the Bank (the "Common Shares"). See "Description of the Notes -- NVCC Automatic
Conversion."
The Notes will be our direct unsecured obligations and, in the event of the Bank's insolvency or winding-up, will rank (a) subordinate in right of payment to the prior
payment in full of all Higher Ranked Indebtedness (as defined herein) and (b) in right of payment equally with and not prior to Deeply Subordinated Indebtedness (as defined
herein) (other than Deeply Subordinated Indebtedness which by its terms ranks subordinate to the Notes) of the Bank, in each case, from time to time outstanding. The Notes will
constitute subordinated indebtedness for the purposes of the Bank Act (Canada) (the "Bank Act"). In the event of the Bank's insolvency or winding-up, the Notes will rank ahead of
the Bank's Common Shares and preferred shares.
We may, at our option, redeem the Notes, with the prior written approval of the Superintendent of Financial Institutions Canada (the "Superintendent"), on not less than 30
days' and not more than 60 days' prior notice to the registered holders of the Notes, (i) in whole or in part, on any Interest Payment Date on or after the First Reset Date, (ii) in
whole but not in part, at any time within 90 days following a Regulatory Event Date (as defined herein) and (iii) in whole but not in part, at any time following the occurrence of a
Tax Event (as defined herein), in each case, at a redemption price equal to 100% of the principal amount thereof, plus any accrued and unpaid interest to, but excluding, the date
fixed for redemption (in each case except to the extent such unpaid interest was cancelled). The Notes are not redeemable at the option or election of holders. See "Description of
the Notes -- Redemption."
Prior to this offering, there has been no public market for the Notes. We do not intend to apply for listing of the Notes on any securities exchange or for inclusion in any
automated quotation system and, consequently, there is no market through which the Notes may be sold and purchasers may not be able to resell the Notes purchased under this
prospectus supplement.
Investing in the Notes involves risks, including the risks described in the "Risk Factors" section on page S-12 of this prospectus supplement and those described in
management's discussion and analysis of financial condition and results of operations in our Annual Report on Form 40-F for the year ended October 31, 2018, which is
incorporated by reference in this prospectus supplement and the accompanying prospectus, dated April 27, 2017.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the Notes or passed upon the adequacy or
accuracy of this prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.
The Notes will not constitute savings accounts, deposits or other obligations that are insured by the United States Federal Deposit Insurance Corporation, the
Deposit Insurance Fund or any other governmental agency or under the Canada Deposit Insurance Corporation Act (Canada), the Bank Act or any other deposit
insurance regime designed to ensure the payment of all or a portion of a deposit upon the insolvency of the deposit taking financial institution.
The Notes will not be subject to Bail-In Conversion (as defined herein).

Proceeds, before
Price to
Underwriting
expenses, to the

Public(1)

Commission

Bank

Per Note

100.000%

1.000%

99.000%
Total
US$500,000,000
US$ 5,000,000

US$ 495,000,000

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(1)
Plus accrued interest, if any, from July 30, 2019, if settlement occurs after that date.
The underwriters expect to deliver the Notes through the book-entry delivery system of The Depository Trust Company and its direct and indirect participants, including
Euroclear Bank S.A./N.V. and Clearstream Banking, société anonyme, on or about July 30, 2019.

BMO Capital Markets

Citigroup

Goldman Sachs & Co. LLC

UBS Investment Bank

Barclays

BNP PARIBAS

BofA Merrill Lynch

Credit Agricole CIB

Credit Suisse
Desjardins Capital Markets

HSBC

J.P. Morgan

Morgan Stanley

Wells Fargo Securities
The date of this prospectus supplement is July 23, 2019.
Table of Contents
TABLE OF CONTENTS
Prospectus Supplement

Page
About this Prospectus Supplement
S-1
Incorporation of Certain Information By Reference
S-1
Summary of the Offering
S-3
Risk Factors
S-12
Use of Proceeds
S-20
Consolidated Capitalization
S-21
Description of the Notes
S-22
U.S. Federal Income Tax Considerations
S-35
Canadian Federal Income Tax Considerations
S-39
Employee Retirement Income Security Act
S-40
Supplemental Plan of Distribution (Conflicts of Interest)
S-42
Validity of the Notes
S-47
Experts
S-48
Prospectus

Page
About This Prospectus

1
Presentation of Financial Information

3
Caution Regarding Forward-Looking Statements

4
Where You Can Find More Information

6
Incorporation of Certain Information by Reference

7
Risk Factors

8
Bank of Montreal

9
Consolidated Capitalization of the Bank

12
Consolidated Earnings Ratios

13
Comparative Per Share Market Price

14
Use of Proceeds

15
Description of Common Shares and Preferred Shares

16
Description of Debt Securities We May Offer

25
United States Federal Income Taxation

43
Canadian Taxation

56
Employee Retirement Income Security Act

59
Plan Of Distribution (Conflicts of Interest)

61
Limitations on Enforcement of U.S. Laws Against the Bank, Our Management and Others

64
Validity of the Securities

64
Experts

65
Other Expenses of Issuance and Distribution

65

We are responsible for the information contained or incorporated by reference in this prospectus supplement, the accompanying prospectus,
and in any free writing prospectus we may authorize to be delivered to you. We have not, and the underwriters have not, authorized anyone to give
you any other information, and take no responsibility for any other information that others may give you. We are not, and the underwriters are
not, making an offer to sell any Notes in any jurisdiction where the offer or sale is not permitted. You should not assume that the information
contained in this prospectus supplement, the accompanying prospectus, the documents incorporated by reference or any free writing prospectus
we may authorize to be delivered to you is accurate as of any date other than the dates thereon. Our business, financial condition, results of
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operations and prospects may have changed since those dates.

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Table of Contents
Unless otherwise mentioned or unless the context requires otherwise, all references in this prospectus supplement to the "Bank," "we," "us,"
"our" or similar references mean Bank of Montreal and do not include the subsidiaries of Bank of Montreal. In this prospectus supplement,
currency amounts are stated in Canadian dollars ("$"), unless specified otherwise.

This prospectus supplement and the accompanying prospectus have been prepared on the basis that any offer of Notes in any member state (the
"Member States" and each, a "Member State") of the European Economic Area ("EEA") will be made pursuant to an exemption under the Prospectus
Directive from the requirement to publish a prospectus for offers of Notes. Accordingly, any person making or intending to make an offer in that Member
State of Notes which are the subject of the offering contemplated in this prospectus supplement and the accompanying prospectus may only do so in
circumstances in which no obligation arises for Bank of Montreal or any underwriter to publish a prospectus pursuant to Article 3 of the Prospectus
Directive in relation to such offer.
The expression Prospectus Directive means Directive 2003/71/EC (as amended or superseded), and includes any relevant implementing measure in
the Member State concerned.
The Notes are not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise made available to any
retail investor in the EEA. For these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article
4(1) of Directive 2014/65/EU (as amended, "MiFID II"); or (ii) a customer within the meaning of Directive 2002/92/EC (as amended or superseded, the
"Insurance Mediation Directive"), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or
(iii) not a qualified investor as defined in the Prospectus Directive, and the expression "offer" includes the communication in any form and by any means of
sufficient information on the terms of the offer and the Notes to be offered so as to enable an investor to decide to purchase or subscribe the Notes.
Consequently, no key information document required by Regulation (EU) No 1286/2014 (as amended, the "PRIIPs Regulation") for offering or selling the
Notes or otherwise making them available to retail investors in the EEA has been prepared and therefore offering or selling the Notes or otherwise making
them available to any retail investor in the EEA may be unlawful under the PRIIPs Regulation.
This prospectus supplement and the accompanying prospectus are for distribution only to persons who (i) are outside the United Kingdom, (ii) have
professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 (as amended, the "Financial Promotion Order"), (iii) are persons falling within Article 49(2)(a) to (d) ("high net worth companies,
unincorporated associations etc.") of the Financial Promotion Order, or (iv) are persons to whom an invitation or inducement to engage in investment
activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities may
otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as "relevant persons"). This prospectus
supplement and the accompanying prospectus are directed only at relevant persons and must not be acted on or relied on by persons who are not relevant
persons. Any investment or investment activity to which this prospectus supplement and the accompanying prospectus relate is available only to relevant
persons and will be engaged in only with relevant persons.

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ABOUT THIS PROSPECTUS SUPPLEMENT
This prospectus supplement describes the specific terms of the Notes. The accompanying prospectus, dated April 27, 2017 (the "accompanying
prospectus") provides you with more general information, some of which may not apply to the Notes. If there is any inconsistency between the information
in this prospectus supplement and the accompanying prospectus, you should rely on the information in this prospectus supplement. We urge you to read
carefully both this prospectus supplement and the accompanying prospectus, together with the information incorporated herein and in the accompanying
prospectus by reference, before deciding whether to invest in any Notes.
You should not consider any information in this prospectus supplement, the accompanying prospectus or any free writing prospectus we have
authorized to be investment, legal or tax advice. You should consult your own counsel, accountant and other advisors for legal, tax, business, financial and
related advice regarding the purchase of the Notes. We are not making any representation to you regarding the legality of an investment in the Notes by you
under applicable investment or similar laws.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The Securities and Exchange Commission (the "SEC") allows us to "incorporate by reference" into this prospectus supplement and the
accompanying prospectus, the information in certain documents we file with it. This means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is considered to be a part of this prospectus supplement and the accompanying
prospectus and should be read with the same care. When we update the information contained in documents that have been incorporated by reference by
making future filings with the SEC, the information incorporated by reference is considered to be automatically updated and superseded. The modifying or
superseding statement need not state that it has modified or superseded a prior statement or include any other information set forth in the document that it
modifies or supersedes. In other words, in the case of a conflict or inconsistency between information contained in this prospectus supplement or the
accompanying prospectus and information incorporated by reference, you should rely on the information contained in the document that was filed later.
The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded statement, when
made, constituted a misrepresentation, an untrue statement of a material fact or an omission to state a material fact that is required to be stated or that is
necessary to make a statement not misleading in light of the circumstances in which it was made. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this prospectus supplement and the accompanying prospectus.
We incorporate by reference the following documents and all documents that we subsequently file with the SEC (other than, in each case, documents
or information deemed to have been furnished and not filed in accordance with the SEC rules) pursuant to Section 13(a), 13(c), 14, or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), until the termination of the offering of the Notes under this prospectus supplement:

· Annual Report on Form 40-F for the fiscal year ended October 31, 2018, filed on December 4, 2018;

· Reports on Form 6-K filed on December 4, 2018 (two filings) (Acc-nos: 0001193125-18-342102 and 0001193125-18-342259);

· Report on Form 6-K filed on December 21, 2018 (Acc-no: 0001176256-18-000253);

· Report on Form 6-K filed on January 29, 2019;

· Report on Form 6-K filed on February 5, 2019;

· Reports on Form 6-K filed on February 26, 2019 (four filings) (Acc-nos: 0001193125-19-052036 , 0001193125-19-052042,

0001193125-19-052049 and 0001193125-19-052057);

· Report on Form 6-K filed on March 8, 2019;

S-1
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· Report on Form 6-K filed on March 26, 2019;

· Report on Form 6-K filed on April 8, 2019 (two filings) (Acc-nos: 0001193125-19-100073 and 0001193125-19-100538);

· Report on Form 6-K filed on April 17, 2019;

· Report on Form 6-K filed on April 25, 2019;

· Report on Form 6-K filed on May 15, 2019;

· Reports on Form 6-K filed on May 29, 2019 (three filings) (Acc-nos: 0001193125-19-159679 , 0001193125-19-159696 and

0001193125-19-159708);

· Report on Form 6-K filed on May 30, 2019;

· Report on Form 6-K filed on June 27, 2019; and

· Report on Form 6-K filed on June 28, 2019.
We may also incorporate any other Form 6-K that we submit to the SEC on or after the date hereof and prior to the termination of the offering of the
Notes under this prospectus supplement if the Form 6-K filing specifically states that it is incorporated by reference into the Registration Statement of
which the accompanying prospectus, as supplemented, forms a part.
We will provide without charge to each person, including any beneficial owner, to whom this prospectus supplement is delivered, upon his or her
written or oral request, a copy of any or all documents referred to above which have been or may be incorporated by reference into this prospectus
supplement excluding exhibits to those documents, unless they are specifically incorporated by reference into those documents. You may obtain copies of
those documents by requesting them in writing or by telephoning us at the following address: Bank of Montreal, 100 King Street West, 1 First Canadian
Place, 21st Floor, Toronto, Ontario, Canada, M5X 1A1, Attention: Corporate Secretary; Telephone: (416) 867-6785.

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Table of Contents
SUMMARY OF THE OFFERING
This summary highlights information contained elsewhere in this prospectus supplement and the accompanying prospectus. As a result, it does
not contain all of the information that may be important to you or that you should consider before investing in the Notes, and this summary is
qualified by the detailed information appearing elsewhere in this prospectus supplement, the accompanying prospectus, and the documents
incorporated by reference herein. You should read carefully this entire prospectus supplement and the accompanying prospectus, including the "Risk
Factors" section of this prospectus supplement, and the documents incorporated by reference into this prospectus supplement, which are described
under "Incorporation of Certain Information by Reference" in this prospectus supplement.

Issuer
Bank of Montreal

Securities Offered
4.800% Fixed Rate Resetting Non-Cumulative Subordinated Additional Tier 1 Capital Notes
(Non-Viability Contingent Capital (NVCC)) (the "Notes")

Aggregate Principal Amount
US$500,000,000

Issue Date
July 30, 2019 (the "Issue Date")

Reset Dates
August 25, 2024 and each fifth anniversary date thereafter (each such date, a "Reset Date").

Maturity Date
The Notes have no scheduled maturity or redemption date. Accordingly, the Bank is not
required to make any repayment of the principal amount of the Notes except if an Event of
Default (as defined herein) has occurred and provided that an NVCC Automatic Conversion
(as defined herein) has not occurred.

Interest Rate
From and including the Issue Date to, but excluding, August 25, 2024 (the "First Reset
Date"), interest will accrue on the Notes at an initial rate equal to 4.800% per annum.
Thereafter, for each period commencing on a Reset Date, from and including such Reset
Date to, but excluding the following Reset Date (each, a "Subsequent Fixed Rate Period"),
interest will accrue on the Notes at a rate per annum equal to the applicable Treasury Yield
plus 2.979%, as determined by the calculation agent two business days prior to the
commencement of such period (each, a "Reset Interest Determination Date"). For the
purposes of the foregoing:

"Treasury Yield" means, for any Subsequent Fixed Rate Period, (i) the rate per annum
corresponding to the semi-annual equivalent yield to maturity, that represents the average for
the week that ends immediately before the week in which the applicable Reset Interest
Determination Date falls, appearing in the most recently published statistical release
designated "H.15" or any successor publication that is published by the Board of Governors
of the United States Federal Reserve System and that establishes yields on actively traded
United States Treasury securities adjusted to constant maturity under the caption "Treasury
Constant Maturities",

S-3
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for the 5-Year U.S. Treasury Bond as that rate is displayed on the Reuters screen FEDCMT
page or (ii) if there is no such published U.S. Treasury security with a maturity of five-years
from the next Reset Date and trading in the public securities markets, then the rate will be
determined by the calculation agent by interpolation between the most recent weekly average
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yield to maturity for two series of U.S. Treasury securities trading in the public securities
market, (A) one maturing as close as possible to, but earlier than, the Reset Date following

the next succeeding Reset Interest Determination Date, and (B) the other maturity as close as
possible to, but later than, the Reset Date following the next succeeding Reset Interest
Determination Date, in each case as published in the most recent H.15. If the Treasury Yield
cannot be determined pursuant to the methods described in clauses (i) or (ii) above, then the
Treasury Yield will be the same interest rate determined for the prior Reset Interest
Determination Date.

"H.15" means the statistical release designated as such, or any successor publication,
published by the Board of Governors of the United States Federal Reserve System, and "most

recent H.15" means the H.15 published closest in time but prior to the close of business on
the second business day prior to the applicable Reset Date.

Interest Payment Dates
Subject to the Bank's right to cancel interest payments, interest on the Notes will be payable
semi-annually in arrears on February 25 and August 25 of each year (each, an "Interest
Payment Date"), commencing February 25, 2020.

Discretionary Cancellation of Interest Payments
Interest will be due and payable on an Interest Payment Date only if it is not cancelled by the
Bank. Any cancelled interest payments will not be cumulative. The Bank has the sole and
absolute discretion at all times and for any reason to cancel (in whole or in part), with notice
to the holders of the Notes, any interest payment that would otherwise be payable on any
Interest Payment Date. As a result, you may not receive any interest on any Interest Payment
Date or at any other times, and you will have no claims whatsoever in respect of that
cancelled interest.

Status and Subordination
The Notes will be our direct unsecured obligations and, in the event of the Bank's insolvency
or winding-up, will rank (a) subordinate in right of payment to the prior payment in full of
all Higher Ranked Indebtedness (as defined herein) and (b) in right of payment equally with
and not prior to Deeply Subordinated Indebtedness (as defined herein) (other than Deeply
Subordinated Indebtedness which by its terms ranks subordinate to the Notes) of the Bank, in
each case, from time to time outstanding. The Notes will constitute subordinated
indebtedness for the purposes of the Bank Act (Canada) (the "Bank Act"). In the event of the
Bank's insolvency or winding-up, the Notes will rank ahead of the Bank's Common Shares
and preferred shares.

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The Notes will not constitute savings accounts, deposits or other obligations that are insured
by the Federal Deposit Insurance Corporation, the Deposit Insurance Fund or any other
governmental agency or under the Canada Deposit Insurance Corporation Act (Canada) (the
"CDIC Act"), the Bank Act or any other deposit insurance regime designed to ensure the
payment of all or a portion of a deposit upon the insolvency of the deposit taking financial
institution.

Optional Redemption
We may, at our option, redeem the Notes, with the prior written approval of the
Superintendent of Financial Institutions Canada (the "Superintendent"), on not less than 30
days' and not more than 60 days' prior notice to the registered holders of the Notes, (i) in
whole or in part, on any Interest Payment Date on or after the First Reset Date, (ii) in whole
but not in part, at any time within 90 days following a Regulatory Event Date and (iii) in
whole but not in part, at any time following the occurrence of a Tax Event, in each case, at a
redemption price equal to 100% of the principal amount thereof, plus any accrued and unpaid
interest to, but excluding, the date fixed for redemption (in each case except to the extent
such unpaid interest was cancelled as described under "Description of the Notes --
Discretionary Cancellation of Interest Payments"). For the purposes of the foregoing:

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"Regulatory Event Date" means the date specified in a letter or other written communication
from the Superintendent to the Bank on which the Notes will no longer be recognized in full
as eligible "Tier 1 Capital" or will no longer be eligible to be included in full as risk-based
"Total Capital" on a consolidated basis under the guidelines for capital adequacy
requirements for banks in Canada as interpreted by the Superintendent.

"Tax Event" means:

(i)
as a result of any change (including any announced prospective change) in or
amendment to the laws (or any regulations or rulings promulgated thereunder) of
Canada or of any political subdivision or taxing authority thereof or therein affecting
taxation, or any change in official position regarding the application or interpretation of
such laws, regulations or rulings (including a holding by a court of competent
jurisdiction), which change or amendment is announced and becomes effective on or
after the date of this prospectus supplement, and which in the written opinion to the
Bank of legal counsel of recognized standing has resulted or will result (assuming, in
the case of any announced prospective change, that such announced change will
become effective as of the date specified in such announcement and in the form
announced) in the Bank becoming obligated to pay, on the next succeeding date on
which payment under the Notes is due, "Additional Amounts" with respect to the Notes
as described under "Description of the Notes -- Payment of Additional Amounts;" or

S-5
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(ii)
on or after the date of this prospectus supplement, any action has been taken by any
taxing authority of, or any decision has been rendered by a court of competent
jurisdiction in, Canada or any political subdivision or taxing authority thereof or
therein, including any of those actions specified in the paragraph immediately above,
whether or not such action was taken or decision was rendered with respect to the
Bank, or any change, amendment, application or interpretation shall be officially
proposed, which, in any such case, in the written opinion to the Bank of legal counsel
of recognized standing, will result (assuming, in the case of any announced prospective
change, that such announced change will become effective as of the date specified in
such announcement and in the form announced) in the Bank becoming obligated to
pay, on the next succeeding date on which payment under the Notes is due, Additional
Amounts with respect to the Notes; or

(iii) the Bank has received an opinion of independent legal counsel of recognized standing
experienced in such matters to the effect that, as a result of, (x) any amendment to,
clarification of, or change (including any announced prospective change) in, the laws,
or any regulations thereunder, or any application or interpretation thereof, of Canada, or
any political subdivision or taxing authority thereof or therein, affecting taxation; (y)
any judicial decision, administrative pronouncement, published or private ruling,
regulatory procedure, rule, notice, announcement, assessment or reassessment
(including any notice or announcement of intent to adopt or issue such decision,
pronouncement, ruling, procedure, rule, notice, announcement, assessment or
reassessment) (collectively, an "administrative action"); or (z) any amendment to,
clarification of, or change in, the official position with respect to or the interpretation of
any administrative action or any interpretation or pronouncement that provides for a
position with respect to such administrative action that differs from the theretofore
generally accepted position, in each case (x), (y) or (z), by any legislative body, court,
governmental authority or agency, regulatory body or taxing authority, irrespective of
the manner in which such amendment, clarification, change, administrative action,
interpretation or pronouncement is made known, which amendment, clarification,
change or administrative action is effective or which interpretation, pronouncement or
administrative action is announced on or after the date of the issue of the Notes, there is
more than an insubstantial risk (assuming any proposed or announced amendment,
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clarification, change, interpretation, pronouncement or administrative action is
effective and applicable) that the Bank is, or may be, subject to more than a de minimis
amount of additional taxes, duties or other governmental charges or civil liabilities
because the treatment of any of its items of income, taxable income,

S-6
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expense, taxable capital or taxable paid-up capital with respect to the Notes or the
treatment of the Notes, as or as would be reflected in any tax return or form filed, to be

filed, or otherwise could have been filed, will not be respected by a taxing authority;
provided that this clause (iii) shall not apply in respect of the deductibility of interest
on the Notes.

Payment of Additional Amounts
Subject to the Bank's right to cancel interest payments, the Bank will pay Additional
Amounts in respect of any withholding or deduction imposed in respect of payments on the
Notes subject to certain exceptions as described under "Description of the Notes -- Payment
of Additional Amounts."

NVCC Automatic Conversion
Upon the occurrence of a Trigger Event, each outstanding Note will automatically and
immediately be converted, on a full and permanent basis, without the consent of the holders
thereof and as of the start of business on the date on which the Trigger Event occurs, into a
number of fully-paid and freely tradable common shares of the Bank (the "Common Shares")
determined by dividing (a) the product of the Multiplier and the Note Value, by (b) the
Conversion Price (an "NVCC Automatic Conversion"). For the purposes of the foregoing:
"Conversion Price" means, in respect of each Note, the greater of (i) the Floor Price, and (ii)
the Current Market Price.
"Current Market Price" means the volume weighted average trading price of the Common
Shares on the Toronto Stock Exchange (the "TSX") or, if not then listed on the TSX, on
another exchange or market chosen by the board of directors of the Bank on which the
Common Shares are then traded, for the 10 consecutive trading days ending on the trading
day immediately prior to the date on which the Trigger Event occurs, converted (if not
denominated in U.S. dollars) into U.S. dollars at the Prevailing Rate on the day immediately
prior to the date on which the Trigger Event occurs. If no such trading prices are available,
the Current Market Price will be the Floor Price.

"Floor Price" means the U.S. dollar equivalent of $5.00 converted into U.S. dollars at the
Prevailing Rate on the day immediately prior to the date on which the Trigger Event occurs,
subject to adjustment in the event of (i) the issuance of Common Shares or securities
exchangeable for or convertible into Common Shares to all holders of Common Shares as a
stock dividend, (ii) the subdivision, redivision or change of the Common Shares into a greater
number of Common Shares, or (iii) the reduction, combination or consolidation of the
Common Shares into a lesser number of Common Shares.

The adjustment will be calculated to the nearest one-tenth of one cent provided that no
adjustment of the Floor Price will be required unless such adjustment would require an
increase or decrease of at least 1% of the Floor Price then in effect; provided, however, that
in such case any adjustment that would otherwise be required to be made will be

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carried forward and will be made at the time of and together with the next subsequent

adjustment which, together with any adjustments so carried forward, will amount to at least
1% of the Floor Price.

"Multiplier" means 1.25.

"Note Value" means, in respect of each Note, the principal amount of such Note plus any
accrued and unpaid interest on such Note to, but excluding, the date of the Trigger Event
(except to the extent such unpaid interest was cancelled).

"Prevailing Rate" means, in respect of any currencies on any day, the spot rate of exchange
between the relevant currencies prevailing as at or about 12:00 noon (New York time) on that
date as appearing on or derived from the Relevant Page or, if such a rate cannot be
determined at such time, the rate prevailing as at or about 12:00 noon (New York time) on the
immediately preceding day on which such rate can be so determined or, if such rate cannot
be so determined by reference to the Relevant Page, the rate determined in such other manner
as an Independent Financial Adviser (as defined herein) shall consider in good faith
appropriate.

"Relevant Page" means the relevant page on Bloomberg (or such other information service
provider) that displays the relevant information.

"Trigger Event" has the meaning set out in the Office of the Superintendent of Financial
Institutions Canada ("OSFI"), Guideline for Capital Adequacy Requirements (CAR),
Chapter 2 -- Definition of Capital, effective April 2018, as such term may be amended or
superseded by OSFI from time to time, which term currently provides that each of the
following constitutes a Trigger Event:

· the Superintendent publicly announces that the Bank has been advised, in writing, that
the Superintendent is of the opinion that the Bank has ceased, or is about to cease, to be
viable and that, after the conversion of the Notes and all other contingent instruments
issued by the Bank and taking into account any other factors or circumstances that are
considered relevant or appropriate, it is reasonably likely that the viability of the Bank
will be restored or maintained; or

· a federal or provincial government in Canada publicly announces that the Bank has
accepted or agreed to accept a capital injection, or equivalent support, from the federal
government or any provincial government or political subdivision or agent or agency
thereof without which the Bank would have been determined by the Superintendent to
be non-viable.

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Restrictions on the Payment of Dividends and
If on any Interest Payment Date, the Bank does not pay in full the applicable interest on the
Retirement of Shares
Notes that is due and payable on such Interest Payment Date (whether as a result of
cancellation or otherwise), the Bank will not (a) declare dividends on the Common Shares or
the preferred shares of the Bank or (b) redeem, purchase or otherwise retire any Common
Shares or preferred shares of the Bank (except pursuant to any purchase obligation, retraction
privilege or mandatory redemption provisions attaching to any preferred shares of the Bank),
in each case, until the month commencing immediately after the Bank makes an interest
payment in full on the Notes.

Common Share Corporate Event
In the event of a capital reorganization, consolidation, merger or amalgamation of the Bank
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or comparable transaction affecting the Common Shares, the Bank will take necessary action
to ensure that holders of Notes receive, pursuant to an NVCC Automatic Conversion, the
number of Common Shares or other securities that such holders would have received if the
NVCC Automatic Conversion occurred immediately prior to the record date for such event.

Prohibited Owners
Upon an NVCC Automatic Conversion, the Bank reserves the right not to deliver some or
all, as applicable, of the Common Shares issuable thereupon to any Ineligible Person (as
defined herein) or any person who, by virtue of the operation of the NVCC Automatic
Conversion, would become a Significant Shareholder (as defined herein) through the
acquisition of Common Shares.

Events of Default
The Indenture (as defined herein) governing the Notes will provide that an Event of Default
in respect of the Notes will occur only if the Bank becomes insolvent or bankrupt or subject
to the provisions of the Winding-up and Restructuring Act (Canada), or if the Bank goes into
liquidation, either voluntarily or under an order of a court of competent jurisdiction, passes a
resolution for the winding-up, liquidation or dissolution of the Bank or otherwise
acknowledges its insolvency. Neither a failure to make a payment on the Notes when due
(including any interest payment, whether as a result of cancellation or otherwise) nor an
NVCC Automatic Conversion upon the occurrence of a Trigger Event will constitute an
Event of Default.

If an Event of Default has occurred, and a Trigger Event has not occurred, the entire principal
amount of and accrued and unpaid interest on all of the Notes (except to the extent such
unpaid interest was cancelled) will become immediately due and payable without any
declaration or other act on the part of the Trustee or any holders of the Notes.

Purchase for Cancellation
Subject to the prior approval of the Superintendent, the Bank may, at any time, purchase
Notes at any price or prices in the open market or

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otherwise. Notes so purchased by the Bank will be cancelled and will not be re-issued.

Agreement with Respect to Principal and Interest
By acquiring any Note, each holder or beneficial owner of such Note or any interest therein,
Deemed Paid upon NVCC Automatic Conversion
including any person acquiring any such Note or interest therein after the date hereof,
irrevocably consents to the principal amount of the Note and any accrued and unpaid interest
thereon being deemed paid in full by the issuance of Common Shares upon the occurrence of
a Trigger Event and the resulting NVCC Automatic Conversion, which occurrence and
resulting NVCC Automatic Conversion will occur without any further action on the part of
such holder or beneficial owner or the Trustee.

U.S. Federal Income Tax Considerations
As described under "U.S. Federal Income Tax Considerations," the Notes will be treated as
equity of the Bank for U.S. federal income tax purposes.

Canadian Federal Income Tax Considerations
As described under "Canadian Federal Income Tax Considerations," no Canadian
withholding tax will apply to interest or principal paid or credited to a Non-Resident Holder
by the Bank or to proceeds received by a Non-Resident Holder on the disposition of a Note,
including upon redemption, an NVCC Automatic Conversion or purchase for cancellation.

Form and Denomination
The Notes will be issued in the form of one or more fully registered global notes registered
in the name of the nominee of The Depository Trust Company. The Notes will be issued
only in minimum denominations of US$1,000 and integral multiples of US$1,000 in excess
thereof.

Use of Proceeds
The net proceeds will be contributed to the general funds of the Bank and will qualify as Tier
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