Bank of Montreal Issues $1 Billion Senior Medium-Term Notes Due 2029 at 4.76% Fixed Rate

Fixed Interest Rate Structure and Payment Schedule

The notes carry a fixed interest rate of 4.76% per annum, with semi-annual interest payments scheduled for the 31st day of January and July, commencing January 31, 2027, and continuing through the stated maturity date or optional redemption date, whichever occurs first. The day count convention for calculating interest is 30/360 on an unadjusted basis, a standard methodology used in corporate debt offerings. Interest accrues from the issue date and is calculated for each interest period spanning from and including the immediately preceding interest payment date to, but excluding, the current payment date.

At maturity on July 31, 2029, unless the notes are redeemed earlier by Bank of Montreal, holders will receive a cash payment in U.S. dollars equal to $1,000 per note plus any accrued and unpaid interest. The notes are available in denominations of $1,000 and any integral multiples of $1,000, accommodating both retail and institutional investors with varying investment sizes. The filing states that the notes will not be listed on any securities exchange, limiting secondary market liquidity to over-the-counter transactions.

Optional Redemption Provisions and Timing

Bank of Montreal retains the right to redeem the notes in whole, but not in part, on optional redemption dates occurring quarterly on the last calendar day of January, April, July, and October. The optional redemption period commences on July 31, 2028, and ends on April 30, 2029, providing the issuer with multiple windows to manage its debt portfolio and refinance at potentially more favorable rates if market conditions permit. Redemption is available at 100% of the principal amount plus accrued and unpaid interest to, but excluding, the redemption date, meaning investors will receive no premium upon early redemption.

Bank of Montreal must provide notice to note holders at least 5 business days and not more than 30 business days prior to any optional redemption date, in accordance with procedures described in the accompanying prospectus supplement. This notification requirement ensures investors have adequate advance warning before redemption occurs. The redemption provision gives the issuer flexibility to manage interest expense if rates decline or if the issuer's cost of capital improves during the three-year holding period.

Pricing and Underwriting Compensation Structure

The original issue price per note is $1,000.00, with BMO Capital Markets Corp. receiving an underwriting discount of $10.00 per note, resulting in net proceeds to Bank of Montreal of $990.00 per note. BMO Capital Markets will allow selected dealers a selling concession of up to $10.00 per note, depending on market conditions relevant to the value of the notes at the time purchase orders are submitted. For eligible institutional investors and investors purchasing notes in fee-based advisory accounts, the original issue price varies based on then-current market conditions and the negotiated price at the time of sale, provided that such prices are not less than $990.00 per note and not more than $1,000 per note.

Dealers who purchase notes for sales to eligible institutional investors and fee-based advisory accounts may forgo some or all selling concessions, reflecting a structure designed to incentivize broad distribution while accommodating different investor types. The filing indicates that the total principal amount and total proceeds to Bank of Montreal were not fully disclosed in the available disclosure document, with specific figures appearing blank in the pricing table.

Bail-In Conversion Features and Regulatory Framework

The notes are designated as bail-inable notes subject to conversion under subsection 39.2(2.3) of the Canada Deposit Insurance Corporation Act. By acquiring the notes, each holder or beneficial owner is deemed to agree to be bound by the CDIC Act, including the potential conversion of the notes, in whole or in part, into common shares of Bank of Montreal or any of its affiliates through one or more transactions and steps. The filing states that this conversion is subject to the application of the laws of the Province of Ontario and the federal laws of Canada applicable therein with respect to the operation of the CDIC Act.

Holders are further deemed to attorn and submit to the jurisdiction of the courts in the Province of Ontario with respect to the CDIC Act and applicable Canadian laws. Investors must represent and warrant that Bank of Montreal has not directly or indirectly provided financing for the express purpose of investing in these bail-inable notes. The filing emphasizes that these terms are binding on holders and beneficial owners despite any provisions in the indenture, the notes themselves, other applicable law, or any other agreement between the investor and Bank of Montreal regarding the notes.

Investor Consent to Bail-In Conversion and Limited Recourse

By acquiring an interest in the notes, each holder or beneficial owner is deemed to irrevocably consent to the converted portion of the principal amount and any accrued and unpaid interest being deemed paid in full by Bank of Montreal upon issuance of common shares of Bank of Montreal or its affiliates during a bail-in conversion event. The filing discloses that this bail-in conversion will occur without any further action on the part of the holder, beneficial owner, or trustee, establishing an automatic conversion mechanism upon regulatory activation. Holders and beneficial owners will have no further rights in respect to the notes to the extent that they are converted in a bail-in conversion, other than those provided under the bail-in regime established by Canadian banking resolution powers.

The consent to bail-in conversion does not limit or otherwise affect any rights that holders or beneficial owners may have under the bail-in regime itself, preserving whatever protections or recovery mechanisms may exist under Canadian banking resolution law. This structure reflects evolving international standards for bank resolution and loss absorption, placing note holders in a subordinated position relative to insured deposits in the event of bank distress.

Risk Factors and Credit Risk Disclosure

The filing emphasizes that the notes involve risks not associated with an investment in conventional debt securities. Specifically, the notes are unsecured obligations of Bank of Montreal, and all payments are subject to the credit risk of the issuer. If Bank of Montreal defaults on its obligations, investors could lose some or all of their investment. The notes are not insured by the Federal Deposit Insurance Corporation, the Deposit Insurance Fund, the Canada Deposit Insurance Corporation, or any other governmental agency, leaving investors without protection from these federal or quasi-governmental insurance programs.

The filing references detailed risk factors beginning on page PS-4 of the pricing supplement and page PS-5 of the accompanying product supplement for additional discussion of investment risks. The notes carry unique risks stemming from the bail-in conversion feature, which could result in the automatic conversion of the notes into equity securities of Bank of Montreal in the event of a regulatory determination that the bank is in distress. This conversion mechanism differs fundamentally from traditional debt instruments and may result in significant dilution of note holders or a transition to equity ownership without explicit investor consent at the time of conversion.

Registration and Offering Documentation Framework

The notes are issued pursuant to Registration Statement No. 333-285508, filed with the Securities and Exchange Commission. The pricing supplement is dated July 27, 2026 (subject to completion), and constitutes a preliminary pricing supplement filed under Rule 424(b)(2) of the Securities Act of 1933. The offering is made to the product supplement number RLN-1 dated March 25, 2025, the prospectus supplement dated March 25, 2025, and the prospectus dated March 25, 2025. The filing states that to the extent any disclosure in the pricing supplement is inconsistent with disclosure in the product supplement, prospectus supplement, or prospectus, the disclosure in the pricing supplement will control.

Bank of Montreal's Central Index Key, or CIK, on the SEC website is 927971. The filing provides direct URLs to the product supplement, prospectus supplement, and prospectus, enabling investors to access complete offering documentation through the SEC's EDGAR database. The SECs review statement notes that neither the Securities and Exchange Commission nor any state securities commission or other regulatory body has approved or disapproved of the notes or passed upon the accuracy or adequacy of the pricing supplement or accompanying documents.

Terms, Conditions, and Investor Considerations

The notes have a CUSIP number of 06376LFH4, facilitating electronic settlement and record-keeping through the Depository Trust Company and affiliated clearing systems. The notes are not subject to repayment at the option of any holder prior to the stated maturity date, eliminating investor-driven redemption rights and locking in the three-year holding period absent an earlier Bank of Montreal redemption. Investors should note that the notes represent unsecured, subordinated obligations of the issuer and are subject to conversion into equity under Canadian banking resolution law, a feature that fundamentally distinguishes these instruments from conventional fixed-income securities.

The pricing supplement indicates that the original issue price for eligible institutional investors and fee-based advisory account holders will vary based on market conditions and negotiated pricing at the time of sale, creating potential price disparities among investor classes. Investors purchasing through dealers who maintain selling concessions may face different effective costs than those purchasing in larger institutional blocks with foregone concessions. The availability of the notes in multiples of $1,000 accommodates various portfolio sizes, though the lack of exchange listing may limit secondary market trading opportunities.

Regulatory Framework and Jurisdictional Considerations

The notes are subject to the application of Canadian banking resolution law, specifically subsection 39.2(2.3) of the Canada Deposit Insurance Corporation Act and the laws of the Province of Ontario. This structure reflects Bank of Montreal's status as a Canadian-chartered bank subject to regulation by the Office of the Superintendent of Financial Institutions Canada and the CDIC. The filing makes clear that the terms relating to bail-in conversion and Ontario jurisdiction are binding on all holders despite any provisions in the indenture or other agreements, establishing a legal hierarchy that prioritizes Canadian regulatory frameworks over contractual arrangements between investors and the bank.

Investors in these notes should understand that their remedies in the event of distress at Bank of Montreal are governed by Canadian law and the CDIC resolution framework rather than U.S. bankruptcy law or securities law remedies. The submission to Ontario courts and Canadian law represents a material jurisdictional consideration for U.S. investors accustomed to U.S. legal protections. The bail-in mechanism established under the CDIC Act takes precedence over note holder claims and contractual rights, positioning these securities in a subordinated position within the bank's capital structure.