Bank of Montreal Launches $9.5 Million Autocallable Notes Tied to NVIDIA Stock Performance

Structured Note Terms and Pricing Details

Bank of Montreal finalized the offering terms for these autocallable notes via a pricing supplement dated July 15, 2026. The notes have a principal amount of $9,523,000 and were priced at par (100%). BMO Capital Markets Corp., a Bank of Montreal subsidiary, acts as both agent and selling agent. Investors purchased the notes in minimum denominations of $1,000 and multiples thereof, with settlement on July 20, 2026.

The pricing includes a 2.00% agent’s commission, resulting in proceeds of 98.00% of the offering amount to Bank of Montreal. These figures reflect aggregate amounts set when BMO established hedge positions on or before the pricing date, subject to market conditions. Some dealers selling to fee-based advisory accounts waived part or all selling concessions, with prices in those accounts ranging from $980.00 to $1,000 per $1,000 principal. The initial estimated note value was $968.06 per $1,000 principal as of the pricing date.

Reference Asset and Initial Pricing Level for NVIDIA Stock

The notes are linked to NVIDIA Corporation common stock (ticker NVDA), with an initial price level set at $212.50 per share on July 15, 2026. This initial level determines eligibility for contingent coupon payments and triggers for automatic redemption during the note’s term.

Note holders do not own NVIDIA shares or have voting rights. Instead, payments depend on NVIDIA’s closing stock price on specified observation dates. The notes are not listed on any exchange, limiting liquidity and secondary market trading for investors seeking early exit.

Contingent Coupon Payment Structure and Barrier Levels

These notes provide quarterly contingent coupon payments of 4.8125% per quarter (approximately 19.25% annually) if NVIDIA’s stock closes at or above the coupon barrier level of $159.38 per share (75% of the initial price) on observation dates. If the stock meets or exceeds this barrier on each quarterly observation date, investors receive $48.125 per $1,000 principal on the corresponding coupon payment date.

Observation dates start September 30, 2026, and continue quarterly through March 29, 2029. If NVIDIA’s stock closes below the barrier on any observation date, no coupon is paid for that period, exposing investors to potential cash flow interruptions alongside equity price risk.

Automatic Redemption and Early Termination Feature

The notes include an automatic redemption mechanism effective from the first observation date on September 30, 2026. If NVIDIA’s closing stock price exceeds 100% of the initial level ($212.50) on any quarterly observation date, the notes are automatically redeemed. Upon redemption, investors receive full principal plus any contingent coupon due on the next coupon payment date, marking the end of the investment.

This feature allows investors to benefit from moderate stock appreciation but caps upside exposure. Investors should be prepared for early redemption if NVIDIA’s stock price rises above the initial level during the three-year term.

Downside Risk and Principal Loss at Maturity

If the notes are not automatically redeemed and mature on July 5, 2029, principal repayment depends on NVIDIA’s stock price at the valuation date of June 29, 2029. A trigger event occurs if the stock price falls below $159.38 (75% of initial $212.50). In such a case, investors incur principal losses proportional to the stock’s decline. For example, a drop to $100 per share would result in approximately a 53% principal loss.

At maturity, investors receive a cash payment equal to $1,000 plus the percentage change in NVIDIA stock multiplied by principal, plus any final contingent coupon if payable. The payment may be zero or substantially less than the invested principal.

Issuer Credit Risk and Payment Obligations

Payments on these notes depend on Bank of Montreal’s creditworthiness. The notes are unsecured obligations and are not insured by any government deposit insurance scheme such as the FDIC or CDIC. Investors bear full credit risk for principal and interest payments.

The notes are not convertible into Bank of Montreal common shares or those of affiliates under the Canada Deposit Insurance Corporation Act, limiting recovery options in adverse scenarios. Investors rely on both Bank of Montreal’s stability and NVIDIA stock performance.

Valuation and Settlement Timeline

The offering spans from pricing on July 15, 2026, through maturity on July 5, 2029. Settlement occurred July 20, 2026. The key valuation date for final payoff and trigger determination is June 29, 2029, six days before maturity.

Quarterly observation dates beginning September 30, 2026, determine coupon payments and potential automatic redemption. The final valuation date decides principal loss at maturity, requiring investors to monitor NVIDIA stock across multiple dates rather than a single point.

Investment Suitability and Risk Considerations

Investors must accept the possibility of early automatic redemption, forgoing full participation in NVIDIA stock gains, and potential partial or total principal loss. These notes are not suitable for those seeking direct NVIDIA equity exposure or traditional fixed-income stability. They involve equity risk, issuer credit risk, and structural complexity in exchange for potential enhanced quarterly income.

Risk disclosures are detailed starting on page P-5 of the pricing supplement, with additional factors in the product supplement, prospectus supplement, and base prospectus. The Securities and Exchange Commission and state securities commissions have neither approved nor disapproved the notes or related documentation.

Distribution and Pricing Variations in Advisory Accounts

BMO Capital Markets Corp. acts as the primary distributor. Some dealers selling to fee-based advisory accounts waived part or all selling concessions, resulting in purchase prices between $980.00 and $1,000 per $1,000 principal for those investors, compared to the standard $1,000 public offering price.

This tiered pricing reflects common industry practice for fee-based advisory models. The notes are not exchange-listed, so secondary market trading would be limited to over-the-counter transactions if available.