A new variation on the Boulton-Katritzky reaction is reported, namely, involving use of a CNC side chain. A novel Montmorillonite-K10 catalyzed nonreductive transamination of a 3-benzoyl-1,2,4-oxadiazole afforded a 3-(alpha-aminobenzyl)-1,2,4-oxadiazole, which was condensed with benzaldehydes to afford the corresponding imines. In the presence of strong base, these imines underwent Boulton-Katritzky-type rearrangement to afford novel 4(5)-acylaminoimidazoles.