BBD.B Bombardier Inc

In connection with the conversion privilege for holders of its Series 2 and Series 3 Preferred Shares, Bombardier Inc. (TSX:BBD.A)(TSX:BBD.B) today announced the basis for resetting the dividend rate on its Series 3 Preferred Shares in accordance with the terms applicable to those shares.

Holders of Bombardier Inc. Series 2 Preferred Shares have the right to convert all or part of their shares, effective on August 1, 2012, on a one-for-one basis into Series 3 Preferred Shares. Holders of Series 3 Preferred Shares have the right to convert all or part of their shares, effective on August 1, 2012, on a one-for-one basis into Series 2 Preferred Shares. Holders who do not convert their shares will retain their Series 2 Preferred Shares or Series 3 Preferred Shares, as the case may be.

In the case of the Series 2 Preferred Shares, starting as of August 1, 2012, holders will continue to receive a monthly floating adjustable cash dividend, as and when declared by the Board of Directors of Bombardier Inc., based on a dividend rate equal to a percentage of the prime rate, subject to certain adjustments in accordance with the terms of such shares.

In the case of the Series 3 Preferred Shares, starting as of August 1, 2012, holders will receive a quarterly fixed cash dividend for the following five years, as and when declared by the Board of Directors of Bombardier Inc., based on a fixed rate equal to 255% of the yield on five-year non-callable Government of Canada bonds determined as at July 11, 2012, in accordance with the terms of such shares. The annual dividend rate applicable to the Series 3 Preferred Shares will be published on July 12, 2012 in several newspapers.

Any registered shareholder who wishes to convert his or her Series 2 and/ or Series 3 Preferred Shares must complete and sign the conversion panel contained on the back of the Series 2 or Series 3 Preferred Share certificate as the case may be, and deliver it, at the latest by 5:00 p.m. (Montreal time) on July 18, 2012, to Computershare Investor Services Inc.

Shareholders who are beneficial owners and who wish to exercise their right of conversion should communicate as soon as possible with their broker or other nominee and follow their instructions. In that case, it is important that they follow such instructions and act in the time frame advised so as to provide enough time to their broker or other nominee to meet the July 18, 2012 deadline.

If, after July 18, 2012, Bombardier Inc. determines that there would be less than one million Series 2 Preferred Shares outstanding after the conversion date (being August 1, 2012), then all remaining Series 2 Preferred Shares will automatically be converted into Series 3 Preferred Shares on a one-for-one basis. However, if, after such date, Bombardier Inc. determines that there would be less than one million Series 3 Preferred Shares outstanding after the conversion date (being August 1, 2012), then all remaining Series 3 Preferred Shares will automatically be converted into Series 2 Preferred Shares on a one-for-one basis. In either case, Bombardier Inc. shall give a written notice to that effect to holders of such remaining shares no later than July 25, 2012.

Subject to the conditions mentioned in the previous paragraph, on August 1, 2017, and every five years thereafter, holders of Series 2 Preferred Shares and holders of Series 3 Preferred Shares will have again the right to convert their shares into shares of the other series.

About Bombardier

Bombardier is the world's only manufacturer of both planes and trains. Looking far ahead while delivering today, Bombardier is evolving mobility worldwide by answering the call for more efficient, sustainable and enjoyable transportation everywhere. Our vehicles, services and, most of all, our employees are what make us a global leader in transportation.

Bombardier is headquartered in Montreal, Canada. Our shares are traded on the Toronto Stock Exchange (BBD) and we are listed on the Dow Jones Sustainability World and North America indexes. In the fiscal year ended December 31, 2011, we posted revenues of $18.3 billion USD. News and information are available at www.bombardier.com or follow us on Twitter @Bombardier.

Shareholders requiring further information about the steps to be followed should contact

Computershare Investor Services Inc.

+1-800-564-6253 or service@computershare.com

Contacts: Isabelle Rondeau Director, Communications Bombardier Inc. +514-861-9481 Shirley Chenier Senior Director, Investor Relations Bombardier Inc. +514-861-9481 www.bombardier.com

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