By Tali Rackner
Minneapolis, Oct. 11 – Bank of Montreal priced $1.76 million of autocallable barrier notes with a contingent coupon due Oct. 12, 2018 linked to the SPDR S&P Oil & Gas Exploration and Production exchange-traded fund, according to a 424B2 filing with the Securities and Exchange Commission.
Every quarter, the notes will pay a coupon equal to 10.25% per year if the fund’s share price is at least 70% of the initial share price on the observation date for that quarter.
The notes will be automatically redeemed at par plus the contingent coupon if the ETF’s shares close above the initial share price on any observation date beginning in April 2018.
If the notes are not called, the payout at maturity will be par unless the final share price is less than the initial price and the fund has closed below 70% of the initial share price during the life of the notes, in which case investors will lose 1% for each 1% decline from the initial share price.
BMO Capital Markets Corp. is the agent.
| Issuer: | Bank of Montreal
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| Issue: | Autocallable barrier notes with contingent coupon
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| Underlying fund: | SPDR S&P Oil & Gas Exploration and Production exchange-traded fund
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| Amount: | $1.76 million
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| Maturity: | Oct. 12, 2018
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| Coupon: | Quarterly at annualized rate of 10.25% if fund closes at or above 70% of initial price on observation date for quarter
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| Price: | Par
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| Payout at maturity: | Par unless final share price is less than the initial price and fund has closed below 70% of the initial share price during the life of the notes, in which case investors will lose 1% for each 1% decline from the initial share price
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| Call: | At par plus continent coupon if fund closes at or above initial price on any observation date beginning in April 2018
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| Initial price: | $33.58
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| Barrier price: | $23.51, 70% of initial price
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| Pricing date: | Oct. 6
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| Settlement date: | Oct. 12
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| Agent: | BMO Capital Markets Corp.
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| Fees: | 0.6%
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| Cusip: | 06367TK58
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