Obbligazione Montreal Bank 12.3% ( US06367WA290 ) in USD

Montreal Bank

100 USD ▼

Canada

US06367WA290 ( in USD )

12.3% per anno ( pagato 2 volte l'anno)

28/05/2021 - Obbligazione è scaduto

Prospetto opuscolo dell'obbligazione Bank of Montreal US06367WA290 in USD 12.3%, scaduta

1 000 USD

2 839 000 USD

06367WA29

N/A

La Bank of Montreal (BMO) è una delle più grandi banche del Canada, con operazioni a livello globale nei settori bancari al dettaglio, commerciali e di investimento.

Analisi Retrospectiva: L'Obbligazione Bank of Montreal (ISIN US06367WA290) Giunta a Scadenza Questo articolo fornisce una panoramica dettagliata di un'obbligazione emessa da Bank of Montreal, con codice ISIN US06367WA290, la quale ha completato il suo ciclo di vita finanziario, essendo giunta a scadenza e rimborsata. Bank of Montreal (BMO), fondata nel 1817, è una delle più antiche e grandi istituzioni finanziarie del Canada. Con sede a Montréal, Québec, opera a livello globale offrendo una vasta gamma di servizi bancari personali e commerciali, gestione patrimoniale, investment banking e servizi di mercati dei capitali. È riconosciuta per la sua solida reputazione e la sua significativa presenza nel settore bancario nordamericano. L'obbligazione in questione, identificata dal codice ISIN US06367WA290 e dal CUSIP 06367WA29, era stata emessa in Canada da Bank of Montreal in dollari statunitensi (USD). Presentava un tasso d'interesse annuale (cedola) pari al 12,3% e prevedeva pagamenti semestrali (due volte l'anno). L'ammontare totale dell'emissione era di 2.839.000 USD, con una dimensione minima di acquisto fissata a 1.000 USD. Al momento della sua operatività, il prezzo di mercato registrato era del 100% del valore nominale. La data di scadenza prevista per questa obbligazione era il 28 maggio 2021. In conformità con i termini dell'emissione, l'obbligazione ha regolarmente raggiunto la sua scadenza ed è stata integralmente rimborsata agli obbligazionisti.

424B2 1 p428200424b2.htm ARC 727

Registration Statement No. 333-237342
Filed Pursuant to Rule 424(b)(2)

Pricing Supplement dated April 27, 2020 to the Prospectus, the Prospectus Supplement
and the Product Supplement, each dated April 20, 2020

US$2,839,00
Autocallable Cash-Settled Notes with Contingent Interest Payments due May 28, 2021
Linked to the Lesser Performing of the Russell 2000® Index and the S&P 500® Index

·
This pricing supplement relates to an offering of Autocallable Cash-Settled Notes with Contingent Interest Payments linked to the Lesser Performing
of the Russell 2000® Index and the S&P 500® Index (the "Underlying Assets").
·
The notes are designed for investors who are seeking conditional interest payments equal to 1.025% per month (or 12.30% per annum) of the
principal amount, as well as a return of principal if the Closing Level of each Underlying Asset on any Call Date beginning on October 23, 2020 is
greater than 100% of its Initial Level (the "Call Level"). Investors should be willing to have their notes automatically redeemed prior to maturity
and be willing to lose some or all of their principal at maturity.
·
The notes will bear interest at a rate equal to 1.025% of the principal amount per month ($10.25 per $1,000 in principal amount) if the closing level
of each Underlying Asset is greater than its Coupon Barrier Level as of the applicable monthly Observation Date. Any interest will be payable on
the last business day of each month, beginning on May 29, 2020, and until the maturity date, subject to the automatic redemption feature.
·
If on any Call Date beginning on October 23, 2020, the Closing Level of each Underlying Asset is greater than its Call Level, the notes will be
automatically called. On the applicable Call Settlement Date, for each $1,000 principal amount, investors will receive the principal amount plus the
applicable interest payment.
·
The notes do not guarantee any return of principal at maturity. Instead, if the notes are not automatically called, the payment at maturity will be
based on the Final Level of each Underlying Asset and whether the Closing Level of either Underlying Asset has declined from its Initial Level
below its Trigger Level on the Valuation Date (a "Trigger Event"), as described below.
·
If the notes are not automatically redeemed, and a Trigger Event occurs with respect to either Underlying Asset, investors will be subject to one-for-
one loss of the principal amount of the notes for any percentage decrease in the Lesser Performing Underlying Asset from its Initial Level to its
Final Level. In such a case, you will receive a cash amount at maturity that is less than the principal amount.
·
The notes will not be listed on any securities exchange.
·
All payments on the notes are subject to the credit risk of Bank of Montreal.
·
The offering priced on April 27, 2020, and the notes will settle through the facilities of The Depository Trust Company on April 30, 2020.
·
The notes are scheduled to mature on May 28, 2021.
·
The notes will be issued in minimum denominations of $1,000 and integral multiples of $1,000.
·
Our subsidiary, BMO Capital Markets Corp. ("BMOCM"), is the agent for this offering. See "Supplemental Plan of Distribution (Conflicts of
Interest)" below.
·
The notes will not be subject to conversion into our common shares or the common shares of any of our affiliates under subsection 39.2(2.3) of the
Canada Deposit Insurance Corporation Act (the "CDIC Act").

Coupon Barrier and
Autocallable
Ticker
Initial
Trigger Levels (75% of
Principal
Price to
Agent's
Note Number
Underlying Assets
Symbols
Levels
the Initial Levels)
CUSIP
Amount
Public(1) Commission(1)
Proceeds to Bank of Montreal
ARC727
Russell 2000® Index
RTY
1,281.878
961.409*
06367WA29 US$2,839,000 100.00%
2.15%
97.85%
US$61,038.50
US$2,777,961.50

S&P 500® Index
SPX
2,878.48
2,158.86

* Rounded to three decimal places in the case of the RTY.
(1) Certain dealers who purchased the notes for sale to certain fee-based advisory accounts may have foregone some or all of their selling concessions, fees or
commissions. The public offering price for investors purchasing the notes in these accounts was between $978.50 and $1,000 per $1,000 in principal amount.

Investing in the notes involves risks, including those described in the "Selected Risk Considerations" section beginning on page P-5 of this pricing supplement,
the "Additional Risk Factors Relating to the Notes" section beginning on page PS-6 of the product supplement, and the "Risk Factors" sections beginning on
page S-1 of the prospectus supplement and on page 8 of the prospectus.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the notes or passed upon the
accuracy of this pricing supplement, the product supplement, the prospectus supplement or the prospectus. Any representation to the contrary is a criminal
offense.
The notes will be our unsecured obligations and will not be savings accounts or deposits that are insured by the United States Federal Deposit Insurance Corporation, the Deposit
Insurance Fund, the Canada Deposit Insurance Corporation or any other governmental agency or instrumentality or other entity.
On the date of this pricing supplement, the estimated initial value of the notes was $951.30 per $1,000 in principal amount. As discussed in more detail in this pricing supplement,
the actual value of the notes at any time will reflect many factors and cannot be predicted with accuracy.

BMO CAPITAL MARKETS

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Key Terms of the Notes:

Underlying Assets:
The Russell 2000® Index (ticker symbol: RTY) and the S&P 500® Index (ticker symbol: SPX). See
the section below entitled "The Underlying Assets" for additional information about the Underlying
Assets.

Conditional Coupon:
If the Closing Level of each Underlying Asset is greater than its respective Coupon Barrier Level as
of the applicable monthly Observation Date, investors will receive an interest payment for that
month. Holders of the notes may not receive any interest payments during the term of the notes.

Interest Rate:
1.025% of the principal amount per month, if payable, unless earlier redeemed. Accordingly, each
interest payment, if payable, will equal $10.25 for each $1,000 in principal amount per month.

Observation Dates:
The fifth scheduled trading day prior to the applicable interest payment date. Each Observation Date
is subject to postponement, as set forth in the product supplement in the section "General Terms of
the Notes--Market Disruption Events."

Interest Payment Dates:
Interest, if payable, will be paid on the last business day of each month, beginning on May 29, 2020,
until the maturity date, subject to the automatic redemption feature.

Automatic Redemption:
If, on any monthly Call Date beginning on October 23, 2020 the Closing Level of each Underlying
Asset is greater than its Call Level, the notes will be automatically redeemed.

Payment upon Automatic If the notes are automatically redeemed, then, on the applicable Call Settlement Date, for each
Redemption:
$1,000 principal amount, investors will receive the principal amount plus the applicable interest
payment.

Call Dates:
The fifth (5th) business day prior to a Call Settlement Date, beginning on October 23, 2020. Each
Call Date is subject to postponement, as set forth in the product supplement in the section "General
Terms of the Notes--Market Disruption Events."

Call Settlement Dates:
The last business day of each month (or the next business day, if not a business day), beginning on
October 30, 2020. The Call Settlement Date for the final Call Date will be the maturity date.

Payment at Maturity:
If the notes are not automatically redeemed, the payment at maturity for the notes is based on the
performance of the Underlying Assets. You will receive $1,000 for each $1,000 in principal amount
of the note, unless a Trigger Event has occurred with respect to either Underlying Asset.

If a Trigger Event has occurred with respect to either Underlying Asset, you will receive at
maturity, for each $1,000 in principal amount of your notes, a cash amount equal to:

$1,000 + [$1,000 x (Percentage Change of the Lesser Performing Underlying Asset)]

This amount will be less than the principal amount of your notes, and may be zero.

You will also receive the final interest payment at maturity, if payable.

Trigger Event:
A Trigger Event will be deemed to occur with respect to an Underlying Asset if its Closing Level is
less than its Trigger Level on the Valuation Date.

Lesser Performing
The Underlying Asset that has the lowest Percentage Change.
Underlying Asset:

Percentage Changes:
With respect to each Underlying Asset,

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Final Level - Initial Level
, expressed as a percentage
Initial Level

Initial Levels:
With respect to each Underlying Asset, its Closing Level on the Pricing Date, as set forth on the
cover page of this pricing supplement.

Call Levels:
With respect to each Underlying Asset, 100% of its Initial Level.

Final Levels:
With respect to each Underlying Asset, its Closing Level on the Valuation Date.

P-2

Coupon Barrier and
With respect to each Underlying Asset, 75% of its Initial Level, as set forth on the cover page of this
Trigger Levels:
pricing supplement.

Pricing Date:
April 27, 2020

Settlement Date:
April 30, 2020

Valuation Date:
May 21, 2021

Maturity Date:
May 28, 2021

Calculation Agent:
BMOCM

Selling Agent:
BMOCM

P-3

Additional Terms of the Notes

You should read this pricing supplement together with the product supplement, prospectus supplement and prospectus, each dated April
20, 2020. 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 Relating to the Notes" in the product 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):

·
Product supplement dated April 20, 2020:
https://www.sec.gov/Archives/edgar/data/927971/000121465920003522/j420202424b5.htm

·
Prospectus supplement dated April 20, 2020:
https://www.sec.gov/Archives/edgar/data/927971/000119312520112249/d908040d424b5.htm

·
Prospectus dated April 20, 2020:
https://www.sec.gov/Archives/edgar/data/927971/000119312520112240/d903160d424b2.htm

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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.

P-4

Selected Risk Considerations

An investment in the notes involves significant risks. Investing in the notes is not equivalent to investing directly in the Underlying Assets or
their components. These risks are explained in more detail in the "Additional Risk Factors Relating to the Notes" section of the product
supplement.

·
Your investment in the notes may result in a loss. -- The notes do not guarantee any return of principal. If the notes are not
automatically redeemed, the payment at maturity will be based on whether a Trigger Event has occurred with respect to either Underlying
Asset. If a Trigger Event has occurred with respect to either Underlying Asset, because the Final Level of either Underlying Asset is less
than its Initial Level, you will be subject to a one-for-one loss of the principal amount of the notes for any Percentage Change of the
Lesser Performing Underlying Asset from its Initial Level. In such a case, you will receive at maturity a cash payment that is less than the
principal amount of the notes and may be zero. Accordingly, you could lose up to the entire principal amount of your notes.

·
You may not receive any conditional interest payments with respect to your notes. -- If the Closing Level of either Underlying
Asset is less than or equal to its respective Coupon Barrier Level as of the applicable monthly Observation Date, you will not receive a
monthly interest payment on the applicable interest payment date. You may not receive any interest payments during the term of the notes.

·
Your notes are subject to automatic early redemption. -- We will redeem the notes if the Closing Level of each Underlying Asset on
any Call Date specified above is greater than its Call Level. Following an automatic redemption, you will not receive any additional
conditional interest payments on the notes, and you may not be able to reinvest your proceeds in an investment with returns that are
comparable to the notes.

·
Your return on the notes is limited to the conditional interest payments, regardless of any appreciation in the value of either
Underlying Asset. -- You will not receive a payment at maturity with a value greater than your principal amount plus the final interest
payment, if payable. In addition, if the notes are automatically called, you will not receive a payment greater than the principal amount
plus the applicable conditional interest payment, even if the Final Level of an Underlying Asset exceeds its Call Level by a substantial
amount. Accordingly, your maximum return for each $1,000 in principal amount of the notes is equal to the potential monthly interest
payments over the term of the notes.

·
Your investment is subject to the credit risk of Bank of Montreal. -- Our credit ratings and credit spreads may adversely affect the
market value of the notes. Investors are dependent on our ability to pay all amounts due on the notes, and therefore investors are subject to
our credit risk and to changes in the market's view of our creditworthiness. Any decline in our credit ratings or increase in the credit
spreads charged by the market for taking our credit risk is likely to adversely affect the value of the notes.

·
Whether interest is payable on the notes, and your payment at maturity may be determined solely by reference to the Lesser
Performing Underlying Asset, even if the other Underlying Asset performs better. -- We will only make each interest payment on
the notes if the Closing Level of each of the Underlying Assets on the applicable Observation Date exceeds the applicable Coupon Barrier
Level, even if the level of the other Underlying Asset has increased significantly. Similarly, if a Trigger Event occurs with respect to
either Underlying Asset, your payment at maturity will be determined by reference to the performance of the Lesser Performing
Underlying Asset. Even if the other Underlying Asset has appreciated in value compared to its Initial Level, or has experienced a decline
that is less than that of the Lesser Performing Underlying Asset, your return at maturity will only be determined by reference to the
performance of the Lesser Performing Underlying Asset if a Trigger Event occurs.

·
The payments on the notes will be determined by reference to each Underlying Asset individually, not to a basket, and the
payments on the notes will be based on the performance of the Lesser Performing Underlying Asset. -- Whether each interest
payment is payable, and the payment at maturity if a Trigger Event occurs, will be determined only by reference to the performance of the
Lesser Performing Underlying Asset, regardless of the performance of the other Underlying Asset. The notes are not linked to a weighted
basket, in which the risk may be mitigated and diversified among each of the basket components. For example, in the case of notes linked
to a weighted basket, the return would depend on the weighted aggregate performance of the basket components reflected as the basket
return. As a result, the depreciation of one basket component could be mitigated by the appreciation of the other basket components, as
scaled by the weighting of that basket component. However, in the case of the notes, the individual performance of each Underlying Asset
would not be combined, and the depreciation of one Underlying Asset would not be mitigated by any appreciation of the other Underlying
Asset. Instead, your receipt of interest payments on the notes will depend on the level of each Underlying Asset on each Observation Date,
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and your return at maturity will depend solely on the Final Level of the Lesser Performing Underlying Asset if a Trigger Event occurs.

P-5

·
Potential conflicts. -- We and our affiliates play a variety of roles in connection with the issuance of the notes, including acting as
calculation agent. In performing these duties, the economic interests of the calculation agent and other affiliates of ours are potentially
adverse to your interests as an investor in the notes. We or one or more of our affiliates may also engage in trading securities included in
the Underlying Assets 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. Any of these activities could adversely affect the level of an
Underlying Asset and, therefore, the market value of the notes. We or one or more of our 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 Underlying Assets. 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 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 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 underwriting discount and selling concessions, 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 date of this pricing supplement was derived using our internal pricing
models. This value is based on market conditions and other relevant factors, which include volatility of the Underlying Assets, dividend
rates and interest rates. 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 and the product 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 value does 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 may 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.

·
You will not have any shareholder rights and will have no right to receive any shares of any company included in either
Underlying Asset at maturity. -- Investing in your notes will not make you a holder of any shares of any company included in either
Underlying Asset. Neither you nor any other holder or owner of the notes will have any voting rights, any right to receive dividends or
other distributions or any other rights with respect to those securities.

P-6

·
Changes that affect an Underlying Asset may adversely affect the market value of the notes and the amount you will receive at
maturity. -- The policies of FTSE Russell, the sponsor of the RTY, and Standard & Poor's, the sponsor of the SPX (each, an "Index
Sponsor"), concerning the calculation of the applicable Underlying Asset, additions, deletions or substitutions of the components of the
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applicable Underlying Asset and the manner in which changes affecting those components, such as stock dividends, reorganizations or
mergers, may be reflected in the applicable Underlying Asset and, therefore, could affect the level of the applicable Underlying Asset, the
amount payable on the notes at maturity and the market value of the notes prior to maturity. The amount payable on the notes and their
market value could also be affected if either Index Sponsor changes these policies, for example, by changing the manner in which it
calculates the applicable Underlying Asset, or if either Index Sponsor discontinues or suspends the calculation or publication of the
applicable Underlying Asset.

·
We have no affiliation with either Index Sponsor and will not be responsible for any actions taken by either Index Sponsor. -- No
Index Sponsor is an affiliate of ours or will be involved in the offering of the notes in any way. Consequently, we have no control over the
actions of either Index Sponsor, including any actions of the type that would require the calculation agent to adjust the payments on the
notes. No Index Sponsor has any obligation of any sort with respect to the notes. Thus, no Index Sponsor has any obligation to take your
interests into consideration for any reason, including in taking any actions that might affect the value of the notes. None of our proceeds
from the issuance of the notes will be delivered to either Index Sponsor.

·
Lack of liquidity. -- The notes will not be listed on any securities exchange. BMOCM may offer to purchase the notes in the secondary
market, but is not required to do so. Even if there is a secondary market, it may not provide enough liquidity to allow you to trade or sell
the notes easily. Because other dealers are not likely to make a secondary market for the notes, the price at which you may be able to trade
the notes is likely to depend on the price, if any, at which BMOCM is willing to buy the notes.

·
Hedging and trading activities. -- We or any of our affiliates may have carried out or may carry out hedging activities related to the
notes, including purchasing or selling securities included in an Underlying Asset, or futures or options relating to an Underlying Asset, or
other derivative instruments with returns linked or related to changes in the performance of an Underlying Asset. We or our affiliates may
also engage in trading relating to an Underlying Asset from time to time. Any of these hedging or trading activities on or prior to the
Pricing Date and during the term of the notes could adversely affect our payment to you at maturity.

·
Many economic and market factors will influence the value of the notes. -- In addition to the level of each Underlying Asset and
interest rates on any trading day, the value of the notes will be affected by a number of economic and market factors that may either offset
or magnify each other, and which are described in more detail in the product supplement.

·
You must rely on your own evaluation of the merits of an investment linked to the Underlying Assets. -- In the ordinary course of
their businesses, our affiliates from time to time may express views on expected movements in the levels of the Underlying Assets or the
prices of the securities included in the Underlying Assets. One or more of our affiliates have published, and in the future may publish,
research reports that express views on the Underlying Assets or these securities. However, these views are subject to change from time to
time. Moreover, other professionals who deal in the markets relating to the Underlying Assets at any time may have significantly different
views from those of our affiliates. You are encouraged to derive information concerning the Underlying Assets from multiple sources, and
you should not rely on the views expressed by our affiliates.

Neither the offering of the notes nor any views which our affiliates from time to time may express in the ordinary course of their
businesses constitutes a recommendation as to the merits of an investment in the notes.

·
An investment in the notes is subject to risks associated in investing in stocks with a small market capitalization. -- The RTY
consists of stocks issued by companies with relatively small market capitalizations. These companies often have greater stock price
volatility, lower trading volume and less liquidity than large-capitalization companies. As a result, the level of the RTY may be more
volatile than that of a market measure that does not track solely small-capitalization stocks. Stock prices of small-capitalization
companies are also generally more vulnerable than those of large-capitalization companies to adverse business and economic
developments, and the stocks of small-capitalization companies may be thinly traded, and be less attractive to many investors if they do
not pay dividends. In addition, small capitalization companies are typically less well-established and less stable financially than large-
capitalization companies and may depend on a small number of key personnel, making them more vulnerable to loss of those individuals.
Small capitalization companies tend to have lower revenues, less diverse product lines, smaller shares of their target markets, fewer
financial resources and fewer competitive strengths than large-capitalization companies. These companies may also be more susceptible
to adverse developments related to their products or services.

P-7

·
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.
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The Internal Revenue Service has released a notice that may affect the taxation of holders of "prepaid forward contracts" and similar
instruments. According to the notice, the Internal Revenue Service and the U.S. Treasury are actively considering whether the holder of
such instruments should be required to accrue ordinary income on a current basis. While it is not clear whether the notes would be
viewed as similar to such instruments, it is possible that any future guidance could materially and adversely affect the tax consequences of
an investment in the notes, possibly with retroactive effect.

Please read carefully the section entitled "Supplemental U.S. Federal Income Tax Considerations" in this pricing supplement, the section
entitled "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.

P-8

Examples of the Hypothetical Payment at Maturity for a $1,000 Investment in the Notes

The following table illustrates the hypothetical payments on a note at maturity, assuming that the notes are not automatically called. The
hypothetical payments are based on a $1,000 investment in the note, a hypothetical Initial Level of 100.00 for each Underlying Asset, a
hypothetical Trigger Level of 75.00 for each Underlying Asset (75.00% of its hypothetical Initial Level), a hypothetical Call Level of 100 for each
Underlying Asset (100% of its hypothetical Initial Level), a range of hypothetical Final Levels of the Lesser Performing Underlying Asset and the
effect on the payment at maturity.

The hypothetical examples shown below are intended to help you understand the terms of the notes. If the notes are not automatically
called, the actual cash amount that you will receive at maturity will depend upon whether the Final Level of either Underlying Asset is below its
Trigger Level on the Valuation Date. If the notes are automatically called prior to maturity, the hypothetical examples below will not be relevant,
and you will receive on the applicable Call Settlement Date, for each $1,000 principal amount, the principal amount plus the applicable interest
payment, if payable.

Your total return on the notes will also depend on the number of monthly periods in which interest is payable, as set forth above.

Hypothetical Final
Hypothetical Final Level of the
Payment at Maturity
Level of the
Lesser Performing Underlying
(Excluding Any Conditional
Lesser Performing
Asset Expressed as a Percentage of
Interest Payment)
Underlying Asset
the Initial Level

150.00
150.00%
$1,000.00
125.00
125.00%
$1,000.00
110.00
110.00%
$1,000.00
100.00
100.00%
$1,000.00
95.00
95.00%
$1,000.00
90.00
90.00%
$1,000.00
85.00
85.00%
$1,000.00
80.00
80.00%
$1,000.00
75.00
75.00%
$1,000.00
70.00
70.00%
$700.00
60.00
60.00%
$600.00
50.00
50.00%
$500.00
25.00
25.00%
$250.00
0.00
0.00%
$0.00

P-9

Supplemental U.S. Federal Income Tax Considerations

The following, together with the discussion of U.S. federal income taxation in the accompanying prospectus and prospectus supplement,
is a general description of the material U.S. tax considerations relating to the notes. It does not purport to be a complete analysis of all tax
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considerations relating to the notes. Prospective purchasers of the notes should consult their tax advisors as to the consequences under the tax
laws of the country of which they are resident for tax purposes and the tax laws of Canada and the U.S. of acquiring, holding and disposing of the
notes and receiving payments under the notes. This summary is based upon the law as in effect on the date of this pricing supplement and is subject
to any change in law that may take effect after such date.

The following section supplements the discussion of U.S. federal income taxation in the accompanying prospectus and prospectus
supplement with respect to United States holders (as defined in the accompanying prospectus). It applies only to those holders who are not
excluded from the discussion of U.S. federal income taxation in the accompanying prospectus. It does not apply to holders subject to special rules
including holders subject to Section 451(b) of the Code. In addition, the discussion below assumes that an investor in the notes will be subject to a
significant risk that it will lose a significant amount of its investment in the notes. Bank of Montreal intends to treat conditional interest payments
with respect to the notes as U.S. source income for U.S. federal income tax purposes.

You should consult your tax advisor concerning the U.S. federal income tax and other tax consequences of your investment in the notes in
your particular circumstances, including the application of state, local or other tax laws and the possible effects of changes in federal or other tax
laws.

NO STATUTORY, JUDICIAL OR ADMINISTRATIVE AUTHORITY DIRECTLY DISCUSSES HOW THE NOTES SHOULD BE
TREATED FOR U.S. FEDERAL INCOME TAX PURPOSES. AS A RESULT, THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF
AN INVESTMENT IN THE NOTES ARE UNCERTAIN. BECAUSE OF THE UNCERTAINTY, YOU SHOULD CONSULT YOUR TAX
ADVISOR IN DETERMINING THE U.S. FEDERAL INCOME TAX AND OTHER TAX CONSEQUENCES OF YOUR INVESTMENT IN
THE NOTES, INCLUDING THE APPLICATION OF STATE, LOCAL OR OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF
CHANGES IN FEDERAL OR OTHER TAX LAWS.

We will not attempt to ascertain whether the issuer of any of the component stocks included in an Underlying Asset would be treated as a
"passive foreign investment company" within the meaning of Section 1297 of the Code or a "U.S. real property holding corporation" within the
meaning of Section 897 of the Code. If the issuer of any of the component stocks included in an Underlying Asset were so treated, certain adverse
U.S. federal income tax consequences could possibly apply. You should refer to any available information filed with the SEC by the component
stocks included in the Underlying Assets and consult your tax advisor regarding the possible consequences to you in this regard.

In the opinion of our counsel, Morrison & Foerster LLP, it would generally be reasonable to treat a note with terms described in this
pricing supplement as a pre-paid cash-settled contingent income-bearing derivative contract in respect of the Underlying Assets for U.S. federal
income tax purposes, and the terms of the notes require a holder and us (in the absence of a change in law or an administrative or judicial ruling to
the contrary) to treat the notes for all tax purposes in accordance with such characterization. Although the U.S. federal income tax treatment of the
conditional interest payments is uncertain, we intend to take the position, and the following discussion assumes, that such conditional interest
payments (including any interest payment on or with respect to the maturity date) constitute taxable ordinary income to a United States holder at
the time received or accrued in accordance with the holder's regular method of accounting. If the notes are treated as described above, it would be
reasonable for a United States holder to take the position that it will recognize capital gain or loss upon the sale or maturity of the notes in an
amount equal to the difference between the amount a United States holder receives at such time (other than amounts properly attributable to any
interest payments, which would be treated, as described above, as ordinary income) and the United States holder's tax basis in the notes. In general,
a United States holder's tax basis in the notes will be equal to the price the holder paid for the notes. Capital gain recognized by an individual
United States holder is generally taxed at ordinary income rates where the property is held for one year or less. The deductibility of capital losses
is subject to limitations.

P-10

Alternative Treatments

Alternative tax treatments of the notes are also possible and the Internal Revenue Service might assert that a treatment other than that
described above is more appropriate. For example, it would be possible to treat the notes, and the Internal Revenue Service might assert that the
notes should be treated, as a single debt instrument. If the notes are so treated, a United States holder would generally be required to accrue interest
currently over the term of the notes irrespective of the conditional interest payments, if any, paid on the notes. In addition, any gain a United States
holder might recognize upon the sale or maturity of the notes would be ordinary income and any loss recognized by a holder at such time would be
ordinary loss to the extent of interest that same holder included in income in the current or previous taxable years in respect of the notes, and
thereafter, would be capital loss.

Because of the absence of authority regarding the appropriate tax characterization of the notes, it is also possible that the Internal Revenue
Service could seek to characterize the notes in a manner that results in other tax consequences that are different from those described above.
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The Internal Revenue Service has released a notice that may affect the taxation of holders of the notes. According to the notice, the
Internal Revenue Service and the Treasury Department are actively considering whether the holder of an instrument such as the notes should be
required to accrue ordinary income on a current basis irrespective of any interest payments, and they sought taxpayer comments on the subject. It is
not possible to determine what guidance they will ultimately issue, if any. It is possible, however, that under such guidance, holders of the notes
will ultimately be required to accrue income currently and this could be applied on a retroactive basis. The Internal Revenue Service and the
Treasury Department are also considering other relevant issues, including whether additional gain or loss from such instruments should be treated
as ordinary or capital and whether the special "constructive ownership rules" of Section 1260 of the Code might be applied to such instruments.
Holders are urged to consult their tax advisors concerning the significance, and the potential impact, of the above considerations. We intend to treat
the notes for U.S. federal income tax purposes in accordance with the treatment described in this pricing supplement unless and until such time as
the Treasury Department and Internal Revenue Service determine that some other treatment is more appropriate.

Backup Withholding and Information Reporting

Please see the discussion under "United States Federal Income Taxation--Other Considerations--Backup Withholding and Information
Reporting" in the accompanying prospectus for a description of the applicability of the backup withholding and information reporting rules to
payments made on your notes.

Non-United States Holders

The following discussion applies to non-United States holders of the notes. A non-United States holder is a beneficial owner of a note
that, for U.S. federal income tax purposes, is a non-resident alien individual, a foreign corporation, or a foreign estate or trust.

While the U.S. federal income tax treatment of the notes (including proper characterization of the conditional interest payments for U.S.
federal income tax purposes) is uncertain, U.S. federal income tax at a 30% rate (or at a lower rate under an applicable income tax treaty) will be
withheld in respect of the conditional interest payments paid to a non-United States holder unless such payments are effectively connected with the
conduct by the non-United States holder of a trade or business in the U.S. (in which case, to avoid withholding, the non-United States holder will
be required to provide a Form W-8ECI). We will not pay any additional amounts in respect of such withholding. To claim benefits under an
income tax treaty, a non-United States holder must obtain a taxpayer identification number and certify as to its eligibility under the appropriate
treaty's limitations on benefits article, if applicable (which certification may generally be made on a Form W-8BEN or W-8BEN-E, or a substitute
or successor form). In addition, special rules may apply to claims for treaty benefits made by corporate non-United States holders. A non-United
States holder that is eligible for a reduced rate of U.S. federal withholding tax pursuant to an income tax treaty may obtain a refund of any excess
amounts withheld by filing an appropriate claim for refund with the Internal Revenue Service. The availability of a lower rate of withholding or an
exemption from withholding under an applicable income tax treaty will depend on the proper characterization of the conditional interest payments
under U.S. federal income tax laws and whether such treaty rate or exemption applies to such payments. No assurance can be provided on the
proper characterization of the conditional interest payments for U.S. federal income tax purposes and, accordingly, no assurance can be provided
on the availability of benefits under any income tax treaty. Non-United States holders must consult their tax advisors in this regard.

P-11

Except as discussed below, a non-United States holder will generally not be subject to U.S. federal income or withholding tax on any
gain (not including for the avoidance of doubt any amounts properly attributable to any interest which would be subject to the rules discussed in
the previous paragraph) upon the sale or maturity of the notes, provided that (i) the holder complies with any applicable certification requirements
(which certification may generally be made on a Form W-8BEN or W-8BEN-E, or a substitute or successor form), (ii) the payment is not
effectively connected with the conduct by the holder of a U.S. trade or business, and (iii) if the holder is a non-resident alien individual, such
holder is not present in the U.S. for 183 days or more during the taxable year of the sale or maturity of the notes. In the case of (ii) above, the
holder generally would be subject to U.S. federal income tax with respect to any income or gain in the same manner as if the holder were a United
States holder and, in the case of a holder that is a corporation, the holder may also be subject to a branch profits tax equal to 30% (or such lower
rate provided by an applicable U.S. income tax treaty) of a portion of its earnings and profits for the taxable year that are effectively connected
with its conduct of a trade or business in the U.S., subject to certain adjustments. Payments made to a non-United States holder may be subject to
information reporting and to backup withholding unless the holder complies with applicable certification and identification requirements as to its
foreign status.

A "dividend equivalent" payment is treated as a dividend from sources within the U.S. and such payments generally would be subject to a
30% U.S. withholding tax if paid to a non-United States holder. Under U.S. Treasury Department regulations, payments (including deemed
payments) with respect to equity-linked instruments ("ELIs") that are "specified ELIs" may be treated as dividend equivalents if such specified
ELIs reference an interest in an "underlying security," which is generally any interest in an entity taxable as a corporation for U.S. federal income
tax purposes if a payment with respect to such interest could give rise to a U.S. source dividend. However, Internal Revenue Service guidance
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provides that withholding on dividend equivalent payments will not apply to specified ELIs that are not delta-one instruments and that are issued
before January 1, 2023. Based on our determination that the notes are not "delta-one" instruments, non-U.S. holders should not be subject to
withholding on dividend equivalent payments, if any, under the notes. However, it is possible that the notes could be treated as deemed reissued for
U.S. federal income tax purposes upon the occurrence of certain events affecting the Underlying Assets or the notes, and following such
occurrence the notes could be treated as delta-one specified ELIs that are subject to withholding on dividend equivalent payments. Non-United
States holders that enter, or have entered, into other transactions in respect of the Underlying Assets or the notes should consult their tax advisors
as to the application of the dividend equivalent withholding tax in the context of the notes and their other transactions. If any payments are treated
as dividend equivalents subject to withholding, we (or the applicable paying agent) would be entitled to withhold taxes without being required to
pay any additional amounts with respect to amounts so withheld.

As discussed above, alternative characterizations of the notes for U.S. federal income tax purposes are possible. Should an alternative
characterization, by reason of change or clarification of the law, by regulation or otherwise, cause payments as to the notes to become subject to
withholding tax in addition to the withholding tax described above, we will withhold tax at the applicable statutory rate. The Internal Revenue
Service has also indicated that it is considering whether income in respect of instruments such as the notes should be subject to withholding tax.
Prospective investors should consult their own tax advisors in this regard.

Foreign Account Tax Compliance Act

The Foreign Account Tax Compliance Act imposes a 30% U.S. withholding tax on certain U.S. source payments, including interest (and
OID), dividends, other fixed or determinable annual or periodical gain, profits, and income, and on the gross proceeds from a disposition of
property of a type which can produce U.S. source interest or dividends ("Withholdable Payments"), if paid to a foreign financial institution
(including amounts paid to a foreign financial institution on behalf of a holder), unless such institution enters into an agreement with the Treasury
Department to collect and provide to the Treasury Department substantial information regarding U.S. account holders, including certain account
holders that are foreign entities with U.S. owners, with such institution. A note may constitute an account for these purposes. The legislation also
generally imposes a withholding tax of 30% on Withholdable Payments made to a non-financial foreign entity unless such entity provides the
withholding agent with a certification that it does not have any substantial U.S. owners or a certification identifying the direct and indirect
substantial U.S. owners of the entity.

P-12

Recently proposed regulations eliminate the requirement of withholding on gross proceeds from the sale or disposition of financial
instruments. The U.S. Treasury Department has indicated that taxpayers may rely on these proposed regulations pending their finalization. If we
determine withholding is appropriate with respect to the notes, we will withhold tax at the applicable statutory rate, and we will not pay any
additional amounts in respect of such withholding. Account holders subject to information reporting requirements pursuant to the Foreign Account
Tax Compliance Act may include holders of the notes. Foreign financial institutions and non-financial foreign entities located in jurisdictions that
have an intergovernmental agreement with the United States governing the Foreign Account Tax Compliance Act may be subject to different rules.
Holders are urged to consult with their own tax advisors regarding the possible implications of this legislation on their investment in the notes.

Supplemental Plan of Distribution (Conflicts of Interest)

BMOCM will purchase the notes from us at a purchase price reflecting the commission set forth on the cover page of this pricing
supplement. BMOCM has informed us that, as part of its distribution of the notes, it will reoffer the notes to other dealers who will sell them. Each
such dealer, or each additional dealer engaged by a dealer to whom BMOCM reoffers the notes, will receive a commission from BMOCM, which
will not exceed the commission set forth on the cover page. This commission will include a selling concession paid by BMOCM or one of its
affiliates to certain dealers of up to 1.60% of the principal amount in connection with the distribution of the notes.

Certain dealers who purchase the notes for sale to certain fee-based advisory accounts may forego some or all of their selling concessions,
fees or commissions. The public offering price for investors purchasing the notes in these accounts may be less than 100% of the principal amount,
as set forth on the cover page of this document. Investors that hold their notes in these accounts may be charged fees by the investment advisor or
manager of that account based on the amount of assets held in those accounts, including the notes.

We will deliver the notes on a date that is greater than two business days following the Pricing Date. Under Rule 15c6-1 of the Securities
Exchange Act of 1934, trades in the secondary market generally are required to settle in two business days, unless the parties to any such trade
expressly agree otherwise. Accordingly, purchasers who wish to trade the notes more than two business days prior to the issue date will be
required to specify alternative settlement arrangements to prevent a failed settlement.

We own, directly or indirectly, all of the outstanding equity securities of BMOCM, the agent for this offering. In accordance with FINRA
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Document Outline

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