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BMO NESBITT BURNS GROUP OF FUNDS

ANNUAL INFORMATION FORM

Offering only Class A and Class F units, unless otherwise noted:

BMO Nesbitt Burns Canadian Stock Selection Fund (Class A, F and I units) BMO Nesbitt Burns U.S. Stock Selection Fund

BMO Nesbitt Burns Bond Fund BMO Nesbitt Burns Balanced Fund

BMO Nesbitt Burns International Equity Fund BMO Nesbitt Burns Balanced Portfolio Fund BMO Nesbitt Burns Growth Portfolio Fund

BMO Nesbitt Burns Maximum Growth Portfolio Fund

October 15, 2010

No securities regulatory authority has expressed an opinion about these securities and it is an offence to claim otherwise. These securities are not registered with the U.S. Securities and Exchange Commission and they are sold in the United States only in reliance on exemptions from registration.

TABLE OF CONTENTS

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NAME, FORMATION AND HISTORY OF THE FUNDS ....................................................................... 1 INVESTMENT RESTRICTIONS ............................................................................................................... 2 DESCRIPTION OF UNITS OF THE FUNDS ............................................................................................ 6

Unitholder Approval ....................................................................................................................... 7 Termination of Funds ...................................................................................................................... 7 Modification of the Master Declaration of Trust ............................................................................ 8

VALUATION OF PORTFOLIO SECURITIES ......................................................................................... 8 CALCULATION OF NET ASSET VALUE ............................................................................................. 11 PURCHASES OF UNITS .......................................................................................................................... 11

Minimum Purchase ....................................................................................................................... 12 Method of Distribution ................................................................................................................. 12 Commissions ................................................................................................................................. 12 Acceptance or Rejection of Subscriptions .................................................................................... 12 Pre-authorized Purchase Plan ....................................................................................................... 13

SWITCHES ............................................................................................................................................... 13 REDEMPTION OF UNITS ....................................................................................................................... 14

Redemption Price .......................................................................................................................... 14 Redemption at Option of the Funds .............................................................................................. 15 Suspension of Redemptions .......................................................................................................... 15 Systematic Withdrawal Program .................................................................................................. 15

RESPONSIBILITY FOR OPERATION OF THE FUNDS ...................................................................... 16 The Manager ................................................................................................................................. 16 Responsibilities of the Manager .................................................................................................... 16 Directors and Officers of the Manager ......................................................................................... 17 Portfolio Advisors ......................................................................................................................... 18 Brokerage Arrangements .............................................................................................................. 20 Trustees of the Funds .................................................................................................................... 21 Remuneration of Trustees and Officers ........................................................................................ 22 Custodian of Portfolio Securities .................................................................................................. 22 Auditors ........................................................................................................................................ 23 Independent Review Committee ................................................................................................... 23 Registrar ........................................................................................................................................ 23 Principal Distributor...................................................................................................................... 23 Administration .............................................................................................................................. 23

CONFLICTS OF INTEREST .................................................................................................................... 24 Principal Holders of Securities ..................................................................................................... 24 Affiliated Entities .......................................................................................................................... 25

FUND GOVERNANCE ............................................................................................................................ 26 General Oversight ......................................................................................................................... 26 Independent Review Committee ................................................................................................... 27 Proxy Voting Policies and Procedures .......................................................................................... 28 Short-term Trading........................................................................................................................ 29 Derivatives Trading ...................................................................................................................... 29

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Securities Lending Transactions, Repurchase Agreements and Reverse Repurchase Agreements ...................................................................................................................... 30

Management Fee Distributions ..................................................................................................... 31

TAX STATUS OF THE FUNDS AND INVESTORS .............................................................................. 31 Tax Status of the Funds ................................................................................................................. 31 Tax Treatment of Investors ........................................................................................................... 32 Eligibility for Investment by Registered Plans ............................................................................. 34 Registered Plans ............................................................................................................................ 34

MATERIAL CONTRACTS ...................................................................................................................... 34 LEGAL PROCEEDINGS .......................................................................................................................... 35 CERTIFICATES ........................................................................................................................................ 35 AUDITORS’ CONSENT ........................................................................................................................... 36 CERTIFICATE OF THE FUNDS ........................................................................................................... C-1 CERTIFICATE OF THE MANAGER, THE PROMOTER AND THE PRINCIPAL

DISTRIBUTOR OF THE FUNDS ............................................................................................. C-2

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NAME, FORMATION AND HISTORY OF THE FUNDS

This annual information form contains detailed information concerning the BMO Nesbitt Burns Group of Funds, which is comprised of BMO Nesbitt Burns Canadian Stock Selection Fund, BMO Nesbitt Burns U.S. Stock Selection Fund, BMO Nesbitt Burns Bond Fund, BMO Nesbitt Burns Balanced Fund, BMO Nesbitt Burns International Equity Fund, BMO Nesbitt Burns Balanced Portfolio Fund, BMO Nesbitt Burns Growth Portfolio Fund and BMO Nesbitt Burns Maximum Growth Portfolio Fund (individually, a “Fund” and collectively, the “Funds”). Class A and Class F units of the Funds and Class I units of BMO Nesbitt Burns Canadian Stock Selection Fund are offered (collectively referred to in this annual information form as “units”).

Each of the Funds is an open-ended mutual fund trust created under and governed by the laws of the Province of Ontario in accordance with the master declaration of trust of the BMO Nesbitt Burns Group of Funds dated October 31, 2008, as amended on October 30, 2009 (the “Master Declaration of Trust”).

The declaration of trust establishing BMO Nesbitt Burns Canadian Stock Selection Fund was dated January 22, 1997 and was amended on September 29, 1999 in order to change the taxation year-end of the Fund to December 15. The declarations of trust establishing BMO Nesbitt Burns U.S. Stock Selection Fund and BMO Nesbitt Burns Bond Fund, respectively, were dated February 15, 2000. The declaration of trust establishing BMO Nesbitt Burns Balanced Fund was dated November 1, 2002. The declaration of trust establishing each of BMO Nesbitt Burns Balanced Portfolio Fund, BMO Nesbitt Burns Growth Portfolio Fund and BMO Nesbitt Burns Maximum Growth Portfolio Fund (collectively, the “BMO Nesbitt Burns Portfolio Funds”) was dated November 1, 2004. Each of these declarations of trust was amended on October 25, 2006 to provide for the issue of more than one class of units, designate the existing units as Class A units and to provide for the calculation of net asset value in accordance with applicable securities legislation, and was further amended on September 12, 2007 to reflect new requirements for an independent review committee. On October 31, 2008, the declarations of trust were amended and restated as the Master Declaration of Trust to provide for the issue of the Class F units of the Funds and the Class I units of the BMO Nesbitt Burns Canadian Stock Selection Fund and to establish BMO Nesbitt Burns International Equity Fund. The Master Declaration of Trust was amended on October 30, 2009 to change the name of BMO Nesbitt Burns All Equity Portfolio Fund to BMO Nesbitt Burns Maximum Growth Portfolio Fund.

Prior to February 11, 2000, BMO Nesbitt Burns Canadian Stock Selection Fund offered units under the name Nesbitt Burns Canadian Stock Selection Fund.

Prior to February 11, 2002, BMO Nesbitt Burns Inc. was the portfolio advisor for BMO Nesbitt Burns U.S. Stock Selection Fund.

The Trustees of the Funds are listed under the heading “Trustees of the Funds”. BMO Nesbitt Burns Inc. (“we”, “us”, “BMO Nesbitt Burns” or the “Manager”) is responsible for the management of the business and affairs of each of the Funds and is the manager, promoter and principal distributor of units of each of the Funds.

BMO Asset Management Inc. (“BMOAM”, formerly Jones Heward Investment Counsel Inc.), Harris Investment Management, Inc. (“Harris”) and Pyrford International Limited (“Pyrford”) provide investment advisory services in connection with the management of certain of the Funds’ investment portfolios. See “Portfolio Advisors”.

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BMO Nesbitt Burns Inc. is located at:

1 First Canadian Place 54th Floor Toronto, Ontario M5X 1H3 Client Services (Toll Free): 1-800-361-1392 Client Services Fax: (866) 486-2846 Email: contact.centre@bmonb.com Website: www.bmonesbittburns.com

INVESTMENT RESTRICTIONS

The assets of a mutual fund must be invested in accordance with the investment objectives and policies of the fund and the investment restrictions and practices adopted by the fund. The investment restrictions and practices adopted by the Funds include the mandatory investment restrictions and practices set out in National Instrument 81-102 of the Canadian Securities Administrators (“National Instrument 81-102”), which are designed in part to ensure that the investments of the Funds are diversified and relatively liquid and to ensure the proper administration of the Funds. These standard investment restrictions and practices are deemed to be incorporated into this annual information form.

Each of the Funds has received an exemption from the Canadian securities regulators to engage in certain transactions in debt securities in which, without the exemption, they would be prohibited from engaging. Pursuant to one such exemption, a Fund may, with the approval of the Independent Review Committee of the Funds (the “IRC”) as described in National Instrument 81-107 of the Canadian Securities Administrators (“National Instrument 81-107”) and subject to complying with certain other provisions of National Instrument 81-107, purchase from or sell to related dealers that are principal dealers in the Canadian debt securities market, non-government debt securities or government debt securities in the secondary market, provided that the purchase or sale is consistent with, or is necessary to meet, the investment objectives of the Fund and:

(a) the transaction occurs in the secondary market;

(b) the bid and ask price of the security are determined by reference to a quote from an independent party if not publicly available; and

(c) a purchase is not executed at a price higher than the ask price and a sale is not executed at a price that is lower than the bid price.

Each of the Funds has also received an exemption pursuant to which, a Fund may, in certain circumstances, with the approval of the IRC and subject to complying with certain other provisions of National Instrument 81-107, purchase debt securities from or sell debt securities to investment funds managed by BMOAM or an affiliate thereof to which National Instrument 81-102 does not apply.

Each of the Funds has also received relief to purchase debt securities of a related issuer, provided that:

(a) the purchase occurs in the secondary market;

(b) the debt security has an approved credit rating by an approved credit rating organization; and

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(c) the price payable is not more than the ask price of the security; the ask price is determined as follows:

(i) if the purchase occurs on a marketplace, in accordance with the requirements of the marketplace; or

(ii) if the purchase does not occur on a marketplace,

(A) the price at which an independent seller is willing to sell; or

(B) not more than the price quoted publicly by an independent marketplace or obtained from an independent party.

The Funds have received an exemption to enable them to purchase and hold debt securities issued by a related party in a primary offering (other than asset-backed commercial paper securities) with a term to maturity of 365 days or more, subject to the following conditions:

(a) the purchase or sale is consistent with, at the time of purchase, or is necessary to meet, the investment objectives of the Fund;

(b) the IRC has approved the transaction at the time of purchase;

(c) we comply with our obligations, as manager, under National Instrument 81-107;

(d) we and the IRC comply with any standing instructions the IRC provides in connection with the transaction;

(e) the size of the offering is at least $100 million;

(f) at least two arm’s-length purchasers collectively purchase at least 20% of the securities issued in the offering;

(g) following the purchase, the Fund does not have more than 5% of its net assets invested in non-exchange traded debt securities of the issuer;

(h) following the purchase, the Funds collectively do not hold more than 20% of the securities issued in the offering;

(i) the purchase price is no higher than the lowest price paid by any arm’s-length purchaser; and

(j) no later than the time the Fund files its annual financial statements, the Fund files with the securities regulatory authority or regulator the particulars of any such investments.

The Funds have received an exemption to enable them, in certain circumstances, to invest in equity securities underwritten by the Manager (or a related entity) during the period of distribution and/or the 60-day period following the period of distribution where the distribution of those securities is made by “private placement” notwithstanding that a related underwriter has acted as the underwriter for the offering provided that:

(a) the issuer is a reporting issuer in Canada; and

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(b) the conditions applicable to an investment in equity securities where the distribution is pursuant to a prospectus are complied with.

BMOAM and its affiliates, including the Manager, have received an exemption to enable the Funds, in certain circumstances, to engage in in specie transactions in respect of the purchase and redemption of units of a Fund by an account managed by BMOAM or an affiliate (a “managed account”) and in respect of the purchase and redemption of units of a Fund by another Fund, another mutual fund that is subject to National Instrument 81-102 for which BMOAM or an affiliate acts as portfolio advisor (a “related fund”) or a pooled fund for which BMOAM or an affiliate acts as portfolio advisor (a “pooled fund”) provided that:

(a) the in specie transaction is conducted in accordance with certain requirements of National Instrument 81-102;

(b) written records of the in specie transaction are maintained; and

(c) BMOAM does not receive any compensation with respect to the sale or redemption of units of the Fund other than redemption fees that have been disclosed and, in respect of any delivery of securities, the only charge paid by the managed account or fund with respect to the in specie transaction is the commission charged by the dealer executing the trade, if applicable, or any administrative charges levied by the custodian.

BMOAM and its affiliates, including the Manager, have received an exemption to enable the Funds, in certain circumstances, to purchase or sell portfolio securities to another Fund, a related fund, a pooled fund or to a managed account provided that:

(a) the purchase or sale of portfolio securities is consistent with the investment objective of the Fund, related fund, pooled fund or managed account, as the case may be;

(b) the IRC has approved the engagement in the transaction by the fund;

(c) if the transaction is with a managed account, the investment management agreement or other documentation with respect to the managed account authorizes the transaction; and

(d) the transaction complies with certain other terms of National Instrument 81-107.

Each of BMO Nesbitt Burns Bond Fund and BMO Nesbitt Burns Balanced Fund has received an exemption permitting it to purchase mortgages from or sell mortgages to the Bank of Montreal and/or MCAP Financial Corporation provided that:

(a) the purchase or sale is consistent with, or is necessary to meet, the investment objectives of the Fund;

(b) the IRC of the Fund approves the transaction in accordance with section 5.2(2) National Instrument 81-107;

(c) the Manager complies with its obligations under section 5.1 of National Instrument 81-107;

(d) the Manager and the IRC of the Fund comply with section 5.4 of National Instrument 81-107 for any standing instructions the IRC provides in connection with the transactions;

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(e) the Fund keeps the written records required by section 6.1(2)(g) of National Instrument 81-107; and

(f) the mortgages are purchased from, or sold to, Bank of Montreal and/or MCAP Financial Corporation in accordance with National Policy Statement 29 - Mutual Funds Investing in Mortgages.

The Funds are dealer managed, as defined under National Instrument 81-102, and as such are subject to prohibitions on certain investments applicable to dealer-managed mutual funds pursuant to National Instrument 81-102. Subject to certain exceptions, a Fund shall not knowingly make an investment in the securities of an issuer:

(a) for which the Manager or an associate or affiliate of the Manager has acted as an underwriter; this restriction is limited to the distribution period and for at least 60 days after the distribution period; or

(b) of which any partner, director, officer or employee of the Manager or any partner, director, officer or employee of any affiliate or associate of the Manager is a partner, director or officer, unless the partner, director, officer or employee does not:

(i) participate in the formulation of investment decisions made on behalf of the Fund;

(ii) have access before implementation to information concerning investment decisions made on behalf of the Fund; and

(iii) influence (other than through research, statistical and other reports generally available to clients) the investment decisions made on behalf of the Fund.

Because of the large number of Canadian transactions in which the Manager (and its affiliates) acts as underwriter, and because of the significance of the Bank of Montreal as an issuer, these limitations could prevent the Funds from purchasing securities which they would otherwise have purchased.

Notwithstanding the above, the Funds may proceed with such investments with the approval of the IRC as described in National Instrument 81-107 and provided that they comply with all other provisions of applicable securities laws.

Subject to certain conditions, the IRC of the Funds has provided the Manager with approval to enable the Funds to:

(a) invest in or continue to invest in securities of Bank of Montreal;

(b) invest in securities during the period of distribution of those securities or during the period of 60 days following the distribution period where an entity that is related to the Manager (a “Manager Affiliate”) acted as an underwriter in the distribution of those securities; and

(c) purchase debt securities from a Manager Affiliate that holds that debt security as principal and/or sell a debt security to a Manager Affiliate that purchases that debt security as principal

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(collectively, “Related Party Transactions”).

For each Related Party Transaction, the IRC has issued standing instructions. These standing instructions require the Manager to follow governing policies and procedures and to report periodically to the IRC. The policies and procedures require, among other things, that the affected investment decisions: (a) be consistent with, or be necessary to meet, the investment objectives of the Funds; (b) be free from any influence by a Manager Affiliate and without taking into account any consideration relevant to a Manager Affiliate; (c) represent the business judgment of the Manager uninfluenced by considerations other than the best interests of the Funds; and (d) achieve a fair and reasonable result for the Fund. In the event an investment decision in respect of a Related Party Transaction is not made in accordance with the foregoing requirements, the Manager is required to notify the IRC and the IRC, as soon as practicable, is required to notify the Canadian securities regulators. The IRC is also required to report such a transaction in its annual report to the securityholders of the Funds.

Additional information about the mandate and responsibilities of the IRC is disclosed under “Independent Review Committee”.

Each of the Funds may use derivative instruments in a manner that is consistent with its investment objectives. The Funds may use derivative instruments to reduce risk but will only do so as permitted by Canada’s securities laws and will not use them to create leverage. The risks associated with the use of derivatives are described in the simplified prospectus of the Funds.

Units of each of the Funds are eligible as investments for registered retirement savings plans, registered retirement income funds, registered disability savings plans, registered education savings plans, deferred profit sharing plans, life income funds, locked-in retirement income funds, locked-in retirement accounts and tax-free savings accounts.

DESCRIPTION OF UNITS OF THE FUNDS

Each Fund is authorized to issue an unlimited number of units. Currently only Class A and Class F units of the Funds and Class I units of BMO Nesbitt Burns Canadian Stock Selection Fund are offered. Other classes of units may be offered in the future. In that event, the rights attached to the other classes will not materially affect the rights attached to the Class A, Class F or the Class I units.

Each unit of a Fund entitles the holder to one vote at each meeting of unitholders of the Fund or class and to participate equally with unitholders of the same class in the distribution of income and capital gains (other than management fee distributions) and, on liquidation, to participate equally with unitholders of the same class in the net assets of the class remaining after satisfaction of outstanding liabilities. The principal difference between the classes relates to the fees payable by the Fund in respect of each of the classes. Please see the simplified prospectus for further information.

If a notice is provided to unitholders of mutual funds held by any of the Funds, such notice will be delivered to the Manager of the Funds. All voting rights attached to units of such underlying funds will be exercised at the option and discretion of the Manager and will not be passed through to unitholders of the Funds. However, if underlying funds held by any of the Funds are managed by BMO Nesbitt Burns or any of its affiliates or associates, such underlying fund’s notices will be delivered to the unitholders of the relevant Fund. All voting rights attached to the units of such underlying funds will be passed through to unitholders of the Fund or will not be exercised.

If a meeting of unitholders of the underlying funds is convened, all disclosure and notice materials prepared in connection with such meeting will be provided to the Manager of the Funds. If underlying

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funds are managed by BMO Nesbitt Burns or any of its affiliates or associates, all such underlying fund’s disclosure and notice materials will be provided to the unitholders of the relevant Fund.

Units of the Funds are fully paid and non-assessable when issued. Fractions of units may be issued. Fractional units shall not, except to the extent that they may represent in the aggregate one or more whole units, entitle the holders thereof to notice of, or to attend or to vote at, meetings of unitholders. Subject to the foregoing, a fractional unit carries the rights and privileges, and is subject to the restrictions and conditions, applicable to whole units in the proportion it bears to one unit. Units are not convertible and investors have no pre-emptive rights. Units may be redeemed by an investor as outlined under “Redemption of Units”.

Unitholder Approval

Prior approval of unitholders is required for the following matters:

(a) a change in the basis of the calculation of the fees or of other expenses that are charged to a Fund or directly to unitholders by the Fund or the Manager that could result in an increase in charges to a Fund or its unitholders;

(b) the introduction of a fee or expense, to be charged to a Fund or directly to a Fund’s unitholders by such Fund or the Manager in connection with the holding of securities of the Fund that could result in an increase in charges to the Fund or its unitholders;

(c) a change in the Manager (other than to an affiliate of the Manager);

(d) a change in the fundamental investment objectives of a Fund;

(e) a decrease in the frequency of calculating net asset value per unit;

(f) a material reorganization of a Fund; or

(g) any modification, amendment, alteration or deletion of the rights, privileges or restrictions attaching to units or which would materially adversely affect the interests of unitholders.

If the nature of the business to be transacted at a meeting concerns only a particular class of a Fund, generally, only investors holding securities of that class of that Fund will be entitled to vote and those units will be voted separately as a class.

All such approvals must be expressed by a resolution passed by not less than a majority of the votes cast at a meeting of the unitholders of the Fund duly called for any such purposes.

Termination of Funds

The Funds may be terminated on the occurrence of certain events specified in the Master Declaration of Trust. The Trustees must give notice to the unitholders of the intention to terminate a Fund, and provide the date on which such termination will take effect. The Trustees must comply with provisions regarding termination contained in the Master Declaration of Trust.

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Modification of the Master Declaration of Trust

Under the Funds’ Master Declaration of Trust, the Trustees may, without the approval of, but upon written notice to unitholders, amend the Master Declaration of Trust for certain limited purposes as specified in the Master Declaration of Trust. Such purposes include amendments that the Trustees determine to be in the best interest of unitholders, add to the rights of unitholders, ensure conformity with current practices in the Canadian mutual fund industry, comply with applicable securities regulations and policies, or make other changes to maintain the Fund’s tax status or the Fund’s distribution policy in the event of a change in the tax treatment of the Fund or make any other changes that may be necessary or desirable as a result of changes in the Income Tax Act (Canada) (the “Tax Act”).

Under the Master Declaration of Trust, the Trustees may, without approval of or notice to unitholders, amend, upon advice of legal counsel, the Master Declaration of Trust to resolve conflicts or inconsistencies between the terms of the Master Declaration of Trust or to correct typographical errors, clerical omissions, mistakes or manifest errors.

No amendments that require notice to unitholders will take effect until after 30 days’ notice to unitholders and no amendments which require the approval of unitholders will take effect until after such approval is provided by unitholders.

VALUATION OF PORTFOLIO SECURITIES

For the purpose of determining the value of any security held by the Funds or any of the Funds’ liabilities at any time, the Funds have adopted substantially the following rules:

(a) The assets of each Fund shall be deemed to include: (i) all cash on hand or on deposit including any interest accrued thereon; (ii) all bills and notes, accounts receivable and prepaid expenses; (iii) all bonds, time notes, shares, subscription rights and other securities owned or contracted for by the Fund; (iv) all stock and cash dividends and cash distributions to be received by it but declared to shareholders of record on a date before the date as of which the value of the assets is being determined; (v) all interest accrued on any interest-bearing securities owned by the Fund (except interest accrued on securities in default which is included in the quoted price); and (vi) all other property of every kind and nature, including prepaid expenses.

(b) The aggregate value of the assets of each of the Funds at any time shall be determined by the Manager in accordance with such method of valuation as the Manager may deem proper and in accordance with any policies, guidelines, rules or regulations which may apply to such Fund. Subject to the foregoing, the following rules shall be applied by the Manager or its designee to the determination of the value of the assets of each of the Funds:

(i) the value of any cash on hand or on deposit, bills and notes and accounts receivable, prepaid expenses, cash dividends or distributions received (or those declared but not yet received where the investment on which the dividend or distribution has been declared is trading ex-dividend as of a date prior to the date of determination of the value of the assets), and interest declared or accrued but not yet received, shall be deemed to be the full amount thereof, unless the Manager determines that any such deposit, bill, note, account receivable, prepaid expense, cash dividend or distribution or interest, as the case may be, is not worth

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the full amount thereof, in which event the value thereof shall be deemed to be such value as the Manager shall deem to be the reasonable value thereof;

(ii) the value of any security which is listed or dealt with on a stock exchange or traded on an over-the-counter market shall be determined by (A) in the case of a security which was traded on the day as of which the value of the assets of the Fund is being determined, the closing sale price, (B) in the case of a security which was not traded on the day as of which the value of the assets of the Fund is being determined, a price which is the mean of the closing recorded bid and asked prices, or (C) if no bid or asked price is available, the price last determined for such security for the purpose of calculating the value of the assets of the Fund. The value of interlisted securities shall be computed in accordance with directions laid down from time to time by the Manager; provided however that if, in the opinion of the Manager, stock exchange or over-the-counter quotations do not properly reflect the prices which would be received by the Fund upon the disposal of securities necessary to effect any redemption of units, the Manager may place such value upon such securities as appears to the Manager to most closely reflect the fair value of such securities;

(iii) the value of securities of any other mutual fund will be the net asset value per security on that day or, if the day is not a valuation date of the underlying fund, the net asset value per security on the most recent valuation date for the underlying fund;

(iv) the Manager shall select the recognized public stock exchange whose quotations are used in the determination of the value of any security which is listed on more than one recognized public stock exchange;

(v) the value of any security which is not listed on any recognized public stock exchange shall be valued by the Manager in its absolute discretion at the last recorded bid price, or the mean between the closing bid and asked prices on the date or at such price as the Manager may from time to time determine more accurately reflects its best estimate of the fair value of such security;

(vi) fixed income securities will be priced within the limits of the latest available or current bid and asked prices deemed best to reflect the fair value, as quoted by independent pricing services or dealers who make markets in such securities or at such price as the Manager may from time to time determine more accurately reflects its best estimate of the fair value of such security;

(vii) the value of any short-term security will be stated at cost which, when combined with accrued interest, approximates market value or, if a more representative value can be obtained, in such manner as the Manager may from time to time determine more accurately reflects its best estimate of the fair value of such security;

(viii) the value of all assets and liabilities of the Fund expressed or denominated in a currency other than Canadian dollars will be converted into Canadian dollars in accordance with the terms of the Funds’ Master Declaration of Trust, provided that in the case of BMO Nesbitt Burns U.S. Stock Selection Fund, the value of the Fund’s assets and liabilities which are expressed in U.S. dollars will not be

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converted into Canadian dollars for purposes of calculating the value of the assets per unit in U.S. dollars if so selected by a unitholder who purchases units in U.S. dollars;

(ix) in determining the net asset value of the Fund, the Manager may, in its sole discretion, accrue any expenses or liabilities which are chargeable to the Fund;

(x) restricted securities shall be valued at the lesser of (A) the value thereof based on reported quotations in common use, and (B) that percentage of the market value of securities of the same class, the resale of which is not restricted or limited by reason of any representation, undertaking or agreement or by law, equal to the percentage that the Fund’s acquisition cost was of the market value of such securities at the time of acquisition, provided that a gradual taking into account of the actual value of the securities may be made when the date on which the restrictions will be lifted is known;

(xi) the value of any security purchased or sold will be reflected in the computation of the value of the assets not later than the first computation of such asset valuation made after the date on which the transaction becomes binding;

(xii) the value of any derivative security, the investment in which is permitted by National Instrument 81-102, shall be determined in accordance with the provisions thereof;

(xiii) the value of all other assets and of any asset for which price quotations are not available or for which the face value or other specified valuation is not, in the opinion of the Manager, appropriate, shall be determined by the Manager on such basis and in such manner as the Manager determines most accurately reflects the best estimate of the fair value thereof; and

(xiv) in the event that the Manager is of the opinion that the fair value of any security is not accurately reflected as a result of the application of any of the foregoing, the fair value of such security shall be determined by such other means as the Manager deems appropriate in the circumstances.

(c) The liabilities of each of the Funds shall be deemed to include: (i) all bills, notes and accounts payable; (ii) all administrative fees and expenses payable or accrued, or both (including management fees); (iii) all contractual obligations for the payment of money or property, including the amount of any unpaid distribution credited to the holders of units of the Fund of record on or before that Valuation Date; (iv) all allowances authorized or approved by the Manager for taxes (if any) or contingencies; and (v) all other liabilities of the Fund of whatsoever kind and nature, except liabilities represented by outstanding units of the Fund.

The Manager has not exercised the discretion referred to in paragraphs (b)(i), (ii), (v), (vi), (vii), (ix), (xiii) or (xiv) during the last three years.

The above principles are used to calculate the net asset value of the Funds to determine the price for unitholder transactions, including purchases and redemptions. This valuation policy differs from the valuation method required for financial reporting under the Canadian Institute of Chartered Accountants Handbook (the “CICA Handbook”). The CICA Handbook requires that portfolio securities in an active

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market be valued using the bid price in financial statements. The primary differences between the methods in the Manager’s valuation policy and the CICA Handbook are that the Manager will generally determine the fair value of the equity securities traded on a stock exchange by using the closing price on the exchange. For bonds, debentures and other debt obligations, the Manager will generally use the average of the bid and ask prices to determine the fair value. While National Instrument 81-106 of the Canadian Securities Administrators requires the net asset value of a Fund to be determined using the fair value of the Fund’s assets and liabilities, it does not require the Fund to determine the fair value in accordance with the CICA Handbook for purposes other than financial reporting.

CALCULATION OF NET ASSET VALUE

The issue and redemption price of units of a Fund is based on the net asset value per unit next determined following receipt and acceptance of a purchase or redemption order. The net asset value per unit is determined as at the close of trading on each day (a “Valuation Date”) the Toronto Stock Exchange is open for business.

The net asset value of each Fund is equal to the value of the assets of the Fund, less the amount of the liabilities of the Fund. Each purchase or sale of assets by a Fund will be reflected in the calculation of the net asset value of the Fund on the next Valuation Date.

The net assets pertaining to a class of units of a Fund consist of that class’ proportion of the assets of the Fund, less that class’ proportion of the common liabilities of the Fund and less the liabilities specifically attributable to that class. The issuance or redemption of units of a class of the Fund will be reflected in the calculation of the net asset value of that class on the next Valuation Date.

The net asset value per unit of a class, at any particular time, is obtained by dividing the net assets of the class by the number of units of the class outstanding at such time, and rounding to the nearest cent. This calculation is made in accordance with the relevant provisions of the Master Declaration of Trust of the Funds and applicable Canadian securities regulations. The net asset value per unit will remain in effect until the next Valuation Date.

Purchase, switch or redemption orders placed before 4 p.m. (Toronto time) on a Valuation Date will be processed at the net asset value determined on that day. Otherwise, the order will be processed at the net asset value on the following Valuation Date. If the Toronto Stock Exchange closes earlier than 4 p.m. (Toronto time), the Manager may impose an earlier deadline.

PURCHASES OF UNITS

Units of the Funds are offered to the public at the net asset value per unit next determined following receipt and acceptance of the order.

Investors in BMO Nesbitt Burns U.S. Stock Selection Fund may purchase units in Canadian or U.S. dollars at the option of the investor. The investor selects the preferred currency of the units at the time of purchase. Thereafter such units will be maintained in the selected currency as long as they are held by the investor.

If there is a change in the value of the U.S. dollar relative to the Canadian dollar between the date on which the purchase price is calculated and the date on which payment is made, a purchaser who elects to purchase units of BMO Nesbitt Burns U.S. Stock Selection Fund in U.S. dollars may experience a foreign exchange gain or loss.

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Minimum Purchase

The minimum initial investment in Class A or Class F units is $1,000 (in the case of BMO Nesbitt Burns U.S. Stock Selection Fund, the initial investment may be in Canadian or U.S. dollars). Any subsequent investment in Class A or Class F units (excluding reinvestment of distributions) must be at least $100 (in the case of BMO Nesbitt Burns U.S. Stock Selection Fund, subsequent investments will be in Canadian or U.S. dollars depending on the currency selected at the time of the initial investment in units). The Manager may change these minimum purchase amounts at any time. The minimum investment amounts for Class I units are determined on a contractual basis.

Method of Distribution

Units of the Funds may only be purchased through a BMO Nesbitt Burns authorized sales representative.

Purchase orders received through an authorized sales representative will be transmitted to the Fund by courier, priority post or telecommunications facility without charge to the purchaser.

Commissions

Investors may pay a sales commission of up to 4% of the purchase price of Class A units, as negotiated with their sales representative. A fixed sales commission in an amount determined by a sales representative may apply on purchases of Class A units (excluding pre-authorized purchase plans) where a 0% sales commission has been negotiated.

Additionally, the Manager may make payments to sales representatives (as trailing commissions) out of the management fees received in respect of Class A units of the Funds, other than BMO Nesbitt Burns Bond Fund, of up to 1.00% of the average daily net asset value of the Class A units held in accounts of clients of the sales representatives. The Manager may make payments to sales representatives (as trailing commissions) out of the management fees received in respect of Class A units of BMO Nesbitt Burns Bond Fund of up to 0.50% of the average daily net asset value of the Class A units held in accounts of clients of the sales representatives. No sales commissions or trailing commissions will be payable in respect of the purchase by the Funds of units of any related or affiliated underlying funds.

Acceptance or Rejection of Subscriptions

The Funds reserve the right to accept or reject purchase orders, provided that any decision to reject an order must be made within one day of receipt of the order and any monies received with that order must be refunded immediately. The Funds have the right at any time to reject subscriptions not accompanied by payment.

If payment of the total amount of a purchase order and all necessary documents are not received by a Fund within three business days of receipt of the order, the Fund will cancel the order by causing the units allotted pursuant to such purchase order to be redeemed. If the redemption price is less than the issue price of such units, the Manager will pay to the Fund the amount of the deficiency and shall be entitled to collect such amount, together with costs, charges and expenses incurred in so doing, and interest thereon, from the investor who has failed to make payment for the units ordered. If the redemption price is greater than the issue price of such units, the excess will belong to the Fund.

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Subscriptions for the purchase of units will not be accepted by any of the Funds during any period when the right to redeem units of such Fund has been suspended. See “Redemption of Units – Suspension of Redemptions”.

In the event that a purchase of units cannot be completed due to there being insufficient funds in the investor’s designated account, the investor may be charged a fee of up to $40, which may be satisfied by the Manager by redeeming the appropriate number of units held by the investor.

Pre-authorized Purchase Plan

Investors may purchase additional units on a regular monthly basis by making use of the Funds’ pre-authorized purchase plan. This plan is only available for purchases of units in Canadian dollars. By using this system, the investor may designate an amount to be invested at a pre-determined date that will be automatically deducted from the investor’s designated bank account and invested in a Fund at the net asset value determined as of the close of trading on the Toronto Stock Exchange on that date. The minimum initial investment for units under the pre-authorized purchase plan is $1,000. Thereafter, the minimum monthly purchase amount under the pre-authorized purchase plan is $100. There are no charges payable by an investor in connection with acquiring additional units under the pre-authorized purchase plan.

In the event that a purchase of units under the pre-authorized purchase plan cannot be completed due to there being insufficient funds in the investor’s designated bank account, the investor may be charged a fee which will be satisfied by the Manager by redeeming a corresponding number of units held by the investor.

The Funds have been exempted from the requirement to deliver an annual renewal simplified prospectus and any amendments to investors that have elected to participate in the Funds’ pre-authorized purchase plan at the time such investors acquire additional units under the plan, unless an investor specifically requests a copy. You may request a copy of the annual renewal simplified prospectus by contacting BMO Nesbitt Burns Inc. by phone toll free at 1-800-361-1392, by email at contact.centre@bmonb.com or by contacting the Manager’s sales representatives (who are referred to in this annual information form as “BMO Nesbitt Burns Investment Advisors” or “Investment Advisors”). The annual renewal simplified prospectus may also be found on our website at www.bmonesbittburns.com or on the SEDAR website at www.sedar.com.

You may exercise your statutory right to withdraw from your initial purchase of units pursuant to a pre-authorized purchase plan. This right does not apply in respect of any subsequent purchase under the pre-authorized purchase plan. However, you will continue to have all other statutory rights under securities law, including rights exercisable if there is a misrepresentation in this prospectus or in any documents incorporated by reference into this prospectus, whether or not you request a copy of the renewal prospectus. You will continue to have the right to terminate your participation in the pre-authorized purchase plan at any time without charge upon written notice to the Fund at least five business days before the end of the month preceding the scheduled purchase.

SWITCHES

An investor may change an investment in a class of units of a Fund into units of another class of the same Fund provided that the investor is an eligible investor for that class of units. This is not a disposition for income tax purposes and, accordingly, will not result in a capital gain or loss for such purposes. There

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may be different fees or charges associated with the other class of units, depending upon the class of units and the arrangements between the investor and the Investment Advisor.

Units of each of the Funds may also be exchanged for units of any of the other Funds, provided the investor is an eligible investor for the applicable class of units, or of any other mutual fund managed by the Manager from time to time as the Manager may permit. This is a disposition for income tax purposes and accordingly, could result in a capital gain or loss for such purposes. There may be different fees or charges associated with the units of the other Fund or mutual fund. See “Tax Status of the Funds and Investors”.

An order to switch units of a Fund may be placed by way of written request, by telephone or on the Internet to the Manager. An initial switch order with respect to Class A or Class F units must be greater than $1,000. Minimum amounts for switching Class I units are determined on a contractual basis. A minimum account balance in a class of each Fund must be maintained in order to avoid automatic redemption of an investor’s remaining units of that class. See “Redemption of Units – Redemption at Option of the Funds” for more details.

When the Manager receives a switch request, the designated units will be redeemed and the redemption proceeds will be applied to the purchase of securities of a specified Fund or Funds at the net asset value next determined after the switch request is received.

A fixed charge in an amount determined by a sales representative may apply.

If an investor is no longer eligible to hold Class F or Class I units, the investor will have 90 days to provide us with instructions to change into another class of units of the same Fund, or demonstrate continued eligibility for Class F or Class I units. In the absence of instructions, we will automatically redesignate the Class F or Class I units into Class A units of the same Fund at the end of the 90-day period.

REDEMPTION OF UNITS

Investors may redeem all or part of their units at their net asset value next determined after receipt of the redemption order. In the case of BMO Nesbitt Burns U.S. Stock Selection Fund, the investor will receive proceeds from redemption in Canadian or U.S. dollars, depending on the currency selected by the unitholder at the time of purchase of the units.

In order to redeem units, the investor must deliver a redemption order, either by telephone, in writing or on the Internet directly to the Manager or to the investor’s Investment Advisor for delivery to the Fund. The request should set out the particulars of the order (i.e., the name of the Fund and the dollar value or number of units to be redeemed). Redemption orders received through an authorized sales representative will be transmitted the same day to the Toronto office of the Manager by courier, priority post or telecommunications facility without charge to the investor.

The Manager will not act on a redemption order made by an investor unless it has received all of the required documentation from the investor.

Redemption Price

The redemption price payable on the redemption of units will be the net asset value per unit next determined after receipt by the Fund of a redemption order.

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Payment will be made within three business days following determination of the net asset value of such units. In the case of BMO Nesbitt Burns U.S. Stock Selection Fund, if the redemption proceeds are paid in U.S. dollars, a unitholder may experience a foreign exchange gain or loss if there is a change in the value of the U.S. dollar relative to the value of the Canadian dollar between the date on which the redemption price is calculated and the payment date.

Redemption at Option of the Funds

Due to the cost of maintaining an account or an investment in a Fund, the Funds reserve the right to redeem units and close an account if the aggregate net asset value of such account is less than a specified amount. The minimum amount for maintaining an investment in Class A or Class F units of a Fund is $500. Minimum holdings for Class I units are determined on a contractual basis. Unitholders will be notified that the account is to be closed and will be given 30 days to make an additional investment to increase the value of the account to at least the required minimum. If a partial redemption of units would cause the remaining units of a unitholder to have an aggregate net asset value which is less than the minimum amount for that class of units, the Funds reserve the right to redeem the remaining units of that class upon 30 days’ notice to such unitholder.

Suspension of Redemptions

Each Fund reserves the right to suspend redemptions or to postpone the date of payment following a redemption (a) during any period when normal trading is suspended on a stock exchange, options exchange or futures exchange where more than 50% of the total assets of such Fund, by market value or underlying market exposure, without allowance for liabilities, are traded, and if those securities are not traded on any other exchange that represents a reasonably practical alternative to the Fund, or (b) with the consent of the applicable Canadian securities regulators. BMO Nesbitt Burns Portfolio Funds may suspend redemptions at any time that any or all of the underlying funds have suspended redemptions.

If a Fund suspends redemptions after an investor has submitted a redemption order, such investor may either (a) withdraw the redemption order, or (b) receive payment based on the net asset value per unit next determined after the resumption of redemptions. In the circumstances described in (b), above, subject to the consent of the applicable Canadian securities regulators, a Fund may effect payment of redeemed units by allocating to the redeeming unitholders a pro rata undivided portion of the Fund’s assets and paying the net proceeds of disposition thereof to such unitholders or, where permitted by applicable law, transferring specific assets to them.

Systematic Withdrawal Program

If an investor’s account has a combined value of at least $20,000, an investor may establish a systematic withdrawal program for any of the Funds and receive regular periodic payments. The minimum amount that an investor may withdraw in each period is $100. A request to establish a systematic withdrawal program must be submitted in writing to the Manager. There are no service fees charged for participating in the program. A participant’s units are redeemed to provide funds for payment. Redemption of units may reduce or possibly exhaust the units in such investor’s account, particularly in the event of a market decline. The tax consequences of redemptions are discussed under the heading “Tax Status of the Funds and Investors”.

A systematic withdrawal program may be terminated on written notice by the investor or a Fund, or upon the death or incapacity of the participant in the program, and it will terminate automatically if all available units are liquidated or withdrawn from the program. An investor may change the amount and frequency

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of payments or suspend such payments by giving written notice to the Manager at least ten business days prior to the end of the month preceding a scheduled payment.

RESPONSIBILITY FOR OPERATION OF THE FUNDS

The Manager

The Manager is a corporation formed under the laws of Canada and is registered as a broker and investment dealer in each of the provinces and territories in Canada. The office of the Manager is located at 1 First Canadian Place, Toronto, Ontario, M5X 1H3. The head office of the Funds is 1 First Canadian Place, 54th floor, Toronto, Ontario, M5X 1H3. You can contact the Manager by writing to the above address, by telephone toll free at 1-800-361-1392, by fax at (866) 486-2846 or by email at contact.centre@bmonb.com. The Manager is an indirect wholly-owned subsidiary of Bank of Montreal.

Responsibilities of the Manager

Pursuant to a management agreement between the Manager and BMO Nesbitt Burns Canadian Stock Selection Fund dated January 22, 1997, management agreements between the Manager and respectively, BMO Nesbitt Burns U.S. Stock Selection Fund and BMO Nesbitt Burns Bond Fund, each dated February 15, 2000, a management agreement between the Manager and BMO Nesbitt Burns Balanced Fund dated November 1, 2002, a master management agreement between the Manager and BMO Nesbitt Burns Balanced Portfolio Fund, BMO Nesbitt Burns Growth Portfolio Fund and BMO Nesbitt Burns Maximum Growth Portfolio Fund dated November 1, 2004 and a management agreement between the Manager and BMO Nesbitt Burns International Equity Fund dated October 31, 2008 (collectively, the “Management Agreements”), the Manager is responsible for the management of the business and affairs of each Fund, subject to the authority and control of the Trustees of each Fund.

Under the Management Agreements, the Manager is responsible for, and has full discretion in:

(a) the day-to-day management of each Fund;

(b) management of each Fund’s investment portfolio;

(c) providing investment analysis and recommendations;

(d) making investment decisions;

(e) the purchase and sale of each Fund’s investment portfolio;

(f) making brokerage arrangements relating thereto; and

(g) distributing the units of the Funds and income and capital gains of each Fund to unitholders.

In return for its services, each Fund pays the Manager a management fee that is calculated daily and payable monthly. The fee paid by each Fund is disclosed in the simplified prospectus. Each Management Agreement may be terminated in certain circumstances, including on 90 days’ written notice given by the relevant Fund or the Manager. A Fund pays all of the applicable taxes on fees paid to the Manager.

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A change in the manager of the Funds, other than to an affiliate of the Manager, may only be effected with the prior approval of the Canadian securities regulatory authorities and the approval of not less than a majority of the votes cast by unitholders of the relevant Fund at a meeting called for such purpose.

Directors and Officers of the Manager

The names, municipalities of residence and positions and offices held with BMO Nesbitt Burns Inc. of the directors and senior officers of BMO Nesbitt Burns Inc. are as follows:

Name and Municipality of Residence Position

L. Jacques Ménard Montréal, Québec

Chairman & Director

Thomas V. Milroy Toronto, Ontario

Chief Executive Officer, Deputy Chairman & Director

Eric C. Tripp Toronto, Ontario

President, Vice-Chairman & Director

Gilles G. Ouellette Toronto, Ontario

Deputy Chairman & Director

Dean G. Manjuris Toronto, Ontario

Vice-Chairman & Director

David C. Ferguson Toronto, Ontario

Executive Managing Director, Chief Financial Officer & Director

Connie Stefankiewicz Toronto, Ontario

Director

The following officers of the Funds or the Manager are primarily responsible for carrying out the functions of the Funds:

Name Position with Manager or Fund

Hamza Bahadurali Managing Director & Vice-President of the Manager

Patrick W.J. French Trustee of the Funds and Managing Director & Vice-President of the Manager

Michael J. Miller Executive Managing Director & Head of Equity Products of the Manager

Richard L. Mills Trustee of the Funds and Executive Vice-President & Managing Director of the Manager

Colin J. Monteith Trustee of the Funds and Senior Vice-President & Managing Director of the Manager

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Name Position with Manager or Fund

Robert J. Schauer Chief Financial Officer of the Funds

Sarah E.A. Widmeyer Trustee, President & Chief Executive Officer of the Funds and Senior Vice-President & Managing Director of the Manager

Robert J. Schauer was appointed in February 2006 as Chief Financial Officer of the Funds.

Portfolio Advisors

The Manager may retain external advisors to assist with the investment management of the Funds.

The Manager has entered into a portfolio advisory agreement dated November 1, 2004 with BMOAM, an indirect wholly-owned subsidiary of Bank of Montreal and an affiliate of the Manager, for the provision of investment advisory and portfolio management services for BMO Nesbitt Burns Canadian Stock Selection Fund, BMO Nesbitt Burns Bond Fund, BMO Nesbitt Burns Balanced Fund, BMO Nesbitt Burns Balanced Portfolio Fund, BMO Nesbitt Burns Growth Portfolio Fund and BMO Nesbitt Burns Maximum Growth Portfolio Fund.

BMOAM is incorporated in the Province of Ontario with its registered and principal office located at 77 King Street West, Suite 4200, Toronto, Ontario, M5K 1J5. The Manager is responsible for the payment of fees to BMOAM for services rendered to BMO Nesbitt Burns Canadian Stock Selection Fund, BMO Nesbitt Burns Bond Fund, BMO Nesbitt Burns Balanced Fund, BMO Nesbitt Burns Balanced Portfolio Fund, BMO Nesbitt Burns Growth Portfolio Fund and BMO Nesbitt Burns Maximum Growth Portfolio Fund.

The BMOAM portfolio advisory agreement may be terminated in certain circumstances, including by BMO Nesbitt Burns Canadian Stock Selection Fund, BMO Nesbitt Burns Bond Fund, BMO Nesbitt Burns Balanced Fund, BMO Nesbitt Burns Balanced Portfolio Fund, BMO Nesbitt Burns Growth Portfolio Fund and BMO Nesbitt Burns Maximum Growth Portfolio Fund, the Manager or BMOAM on 60 days’ prior written notice to the other signatories to the agreement.

The Manager has also entered into a portfolio advisory agreement dated February 19, 2002 with Harris, an indirect wholly-owned subsidiary of Bank of Montreal and an affiliate of the Manager, for the provision of investment advisory services for BMO Nesbitt Burns U.S. Stock Selection Fund. Harris is an investment management firm based in Chicago, Illinois. Harris is entitled to fees for its services under the Harris portfolio advisory agreement. The portfolio advisory agreement may be terminated in certain circumstances, including by BMO Nesbitt Burns U.S. Stock Selection Fund, the Manager or Harris on 30 days’ prior written notice to the other signatories to the agreement.

In addition, the Manager has entered into a portfolio advisory agreement dated October 31, 2008 with Pyrford, a wholly-owned, indirect subsidiary of Bank of Montreal and an affiliate of the Manager, for the provision of investment advisory and portfolio management services for BMO Nesbitt Burns International Equity Fund. Pyrford is a provider of international asset management services for pension funds, charities, endowments, foundations and high net worth individuals. The company has been operating from its London, U.K. base since 1987. In December 2007, Bank of Montreal Capital Markets (Holdings) Limited, a company within the BMO Financial Group, acquired 100% of the share capital of Pyrford International Limited. Pyrford is entitled to fees for its services under the Pyrford portfolio advisory agreement. The portfolio advisory agreement may be terminated in certain circumstances,

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including by the Manager or Pyrford on 90 days’ prior written notice to the other signatory to the agreement.

Specific investment decisions are made by the following individuals in respect of each Fund listed below:

Fund Portfolio Advisor Individual(s) Principally Responsible

BMO Nesbitt Burns Canadian Stock Selection Fund BMO AM Gino Di Monte

BMO Nesbitt Burns Balanced Fund BMO AM Gino Di Monte

BMO Nesbitt Burns Balanced Portfolio Fund BMO AM Gino Di Monte

BMO Nesbitt Burns Growth Portfolio Fund BMO AM Gino Di Monte

BMO Nesbitt Burns Maximum Growth Portfolio Fund BMO AM Gino Di Monte

BMO Nesbitt Burns U.S. Stock Selection Fund Harris T. Andrew Janes Matthew Bender

BMO Nesbitt Burns Bond Fund BMO AM Andrew Osterback

BMO Nesbitt Burns Balanced Fund BMO AM Andrew Osterback

BMO Nesbitt Burns International Equity Fund Pyrford Tony Cousins Paul Simons

Gino Di Monte, CFA, B.Comm., Vice President and Portfolio Manager, Canadian Equities, BMO Asset Management Inc.

Gino Di Monte is Vice President and Portfolio Manager of BMOAM, having joined the firm in 1997. Gino is a CFA charterholder and holds a Bachelor of Commerce degree from the University of Toronto.

T. Andrew Janes, J.D., CFA, Partner and Portfolio Manager, Harris Investment Management, Inc.

Andrew Janes is a Partner and Portfolio Manager of Harris. Andrew joined Harris in 1999. Andrew is a CFA charterholder and holds a Bachelor of Science degree in economics from The Ohio State University and a Juris Doctor from Capital University Law School.

Matthew Bender, MBA, Principal, Fundamental Analyst, Harris Investment Management, Inc.

Matthew Bender is a Principal, Fundamental Analyst with Harris. Matthew joined Harris in 2005 after graduation from business school. Matthew holds an MBA from Kellogg School of Management and a Bachelor of Science in Economics from the Wharton School, University of Pennsylvania.

Andrew Osterback, CFA, B.Comm., B.A., Vice President, Portfolio Manager, Fixed Income Investments, BMO Asset Management Inc.

Andrew Osterback is a Vice President and Portfolio Manager of BMOAM. Andrew has been with BMOAM since May, 2005. Prior to joining BMOAM, Andrew managed a mix of mutual funds, pooled assets and segregated private client portfolios for a major institutional investor. Andrew holds an Honours Bachelor of Commerce degree from the University of Windsor, a Bachelor of Arts degree (economics) from the University of Western Ontario and is also a CFA charterholder.

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Tony Cousins, CFA, M.A., B.A., Pyrford International Limited

Tony Cousins joined Pyrford in 1989 and obtained his Master of Arts and became a CFA charterholder in 1990. He is Director, Portfolio Management and is responsible for the European region (including the U.K.) and is a member of the investment strategy committee. Tony is a graduate from Cambridge University with a Bachelor of Arts.

Paul Simons, CFA, M.A., Pyrford International Limited

Paul Simons joined Pyrford in 1996 after graduating from Oxford University with a degree in geography. Paul is a CFA charterholder, and gained his Master of Arts in 2000. Paul joined the Asia/Pacific portfolio management team in 1996 and was appointed its Head in March 2008. He is the Head of Portfolio Management, Asia/Pacific.

Brokerage Arrangements

Decisions regarding the purchase and sale of portfolio securities for BMO Nesbitt Burns Canadian Stock Selection Fund, BMO Nesbitt Burns Bond Fund, BMO Nesbitt Burns Balanced Fund, BMO Nesbitt Burns Balanced Portfolio Fund, BMO Nesbitt Burns Growth Portfolio Fund and BMO Nesbitt Burns Maximum Growth Portfolio Fund are made by BMOAM, taking into consideration the particular investment objectives and policies of those Funds.

Decisions regarding the purchase and sale of portfolio securities for BMO Nesbitt Burns U.S. Stock Selection Fund are made by Harris, taking into consideration the particular investment objectives and policies of that Fund.

Decisions regarding the purchase and sale of portfolio securities for BMO Nesbitt Burns International Equity Fund are made by Pyrford, taking into consideration the particular investment objectives and policies of that Fund.

Execution of portfolio transactions for each of the Funds, other than for BMO Nesbitt Burns U.S. Stock Selection Fund and BMO Nesbitt Burns International Equity Fund, is generally done by BMO Nesbitt Burns, in its capacity as broker. BMO Nesbitt Burns generally does not receive commissions from the Funds for trade execution services and does not provide investment services, such as research analysis and reports, in return for the allocation of brokerage transactions.

A third party broker generally executes trades for BMO Nesbitt Burns U.S. Stock Selection Fund and BMO Nesbitt Burns International Equity Fund. When and if brokers other than BMO Nesbitt Burns are used to perform portfolio transactions for any of the Funds, such Funds will be required to pay commissions in connection with such transactions.

Brokerage business is allocated to dealers and brokers based on quality of service and the terms offered for specific transactions including price, volume, speed and certainty of execution, the competitiveness of commission terms and prices, the range of services and the quality of research provided and total transaction cost. The process for allocating brokerage business is the same as described above for dealers that are affiliated entities.

There are no ongoing contractual arrangements with any brokers with respect to securities transactions.

In addition to order execution goods and services, dealers or third parties may provide research goods and services, which include: (a) advice as to the value of securities and the advisability of effecting

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transactions in securities; and (b) analyses and reports concerning securities, issuers, industries, portfolio strategy or economic or political factors and trends that may have an impact on the value of securities. Such goods and services may be provided by the executing dealer directly (known as proprietary research) or by a party other than the executing dealer (known as third party research).

In the event of the provision of a good or service that contains an element that is neither research goods and services nor order execution goods and services (“mixed-use goods and services”), such as data analysis, software applications and data feeds, brokerage commissions will only be used to pay for the portion of such goods and services which would qualify as either research goods and services or order execution goods and services. The applicable portfolio advisor would itself pay for the remainder of the costs of such mixed-use goods or services. Records detailing the payment allocations will be kept.

The portfolio advisor makes a good faith determination that the Fund, on whose behalf it directs to a dealer any brokerage transactions involving client brokerage commissions in return for research and order execution goods and services, receives reasonable benefit, considering both the use of the goods and services and the amount of brokerage commissions paid, by conducting extensive trade cost analyses.

Research and order execution goods and services may benefit not only the Funds whose trades generated the brokerage commission, but may also benefit other funds and clients to whom the portfolio advisor provides advice. Such research and order execution goods and services may also be shared with affiliates of the Manager. Similarly, a Fund may benefit from research and order execution goods and services obtained with brokerage commissions generated by client accounts of affiliates of the Manager. There are policies and procedures in place to ensure that, over a reasonable period of time, all clients, including the Funds, receive a fair and reasonable benefit in return for the commissions generated.

Since the date of the last annual information form, no organizations have provided investment services, including research analysis and reports concerning securities and portfolio strategies and statistical and other similar services, to the Manager or a person appointed by the Manager in return for the allocation of brokerage transactions. You may request a list of the dealers, brokers or third parties that provide research goods and services or order execution goods and services, at no cost, by contacting BMO Nesbitt Burns Inc. by phone toll free at 1-800-361-1392 or by email at contact.centre@bmonb.com.

Trustees of the Funds

There are seven individual trustees of each of the Funds (the “Trustees”). If a Trustee resigns or ceases to be a Trustee of any Fund for any reason, the vacancy may be filled by a vote of not less than a majority of the Trustees of the Fund continuing in office. The number of Trustees of each Fund may be increased or decreased by a vote of the majority of the Trustees of such Fund then in office.

The names and municipalities of residence of the Trustees of the Funds and the principal occupation of each such person are as follows:

Name and Municipality of Residence

Position with the Fund

Principal Occupation

Richard Belley Toronto, Ontario

Trustee Vice-President, Fixed Income Strategist and Portfolio Manager, BMO Nesbitt Burns Inc.

Patrick W.J. French Oakville, Ontario

Trustee Vice-President & Managing Director, BMO Nesbitt Burns Inc.

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Name and Municipality of Residence

Position with the Fund

Principal Occupation

Mary Lafazanis Toronto, Ontario

Trustee Senior Manager Wealth Group, Strategic Initiatives, BMO Nesbitt Burns Inc.

Darcy M. Lake Toronto, Ontario

Trustee Chief Compliance Officer, BMO Investments Inc.

Richard L. Mills Toronto, Ontario

Trustee Executive Vice-President & Managing Director, BMO Nesbitt Burns Inc.

Colin J. Monteith Toronto, Ontario

Trustee Senior Vice-President & Managing Director, BMO Nesbitt Burns Inc.

Sarah E.A. Widmeyer Toronto, Ontario

President and Chief Executive Officer and Trustee

Senior Vice-President & Managing Director, BMO Nesbitt Burns Inc.

All Trustees have held their principal occupations, or other positions with BMO Nesbitt Burns, for the past five years. Richard Belley was appointed on August 13, 2010 as Trustee of the Funds. He has held various roles with BMO Nesbitt Burns for the past 15 years. Mary Lafazanis was appointed in March 2008 as Trustee of the Funds. She has held various roles with BMO Nesbitt Burns since August 1990. Darcy M. Lake was appointed on March 10, 2010 as Trustee of the Funds and is currently the Chief Compliance Officer of BMO Investments Inc.

Remuneration of Trustees and Officers

Trustees are entitled to receive such remuneration as the Trustees shall from time to time determine. The Trustees are also employees of the Manager and receive their compensation from the Manager and not from the Funds.

Custodian of Portfolio Securities

The Funds and the Manager have entered into a custodial services agreement dated February 22, 2002 with CIBC Mellon Trust Company (the “Custodian”), located at 320 Bay Street, Toronto, Ontario, M5H 4A6. Under the custodian agreement, the Custodian acts as custodian for each Fund’s assets. The fees payable in connection with such services are payable by the Funds out of the assets of the Funds. The custodial services agreement may be terminated in certain circumstances, including on 90 days’ written notice given by either party to the agreement. In certain circumstances, a change of custodian requires the prior approval of Canadian securities regulatory authorities.

Pursuant to the terms of the custodian agreement, the Custodian has the right to appoint a sub-custodian. Foreign assets may be held by local sub-custodians appointed by the Custodian or under their authority in various foreign jurisdictions where a Fund may have assets invested. The sub-custodians appointed to hold assets of the Funds and their municipalities are listed in a Compliance Report prepared and filed on behalf of the Funds by the Custodian on SEDAR at www.sedar.com.

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Auditors

PricewaterhouseCoopers LLP, 77 King Street West, Toronto, Ontario, M5K 1G8 are the auditors of the Funds.

Independent Review Committee

In accordance with NI 81-107, the Manager has appointed an IRC for the Funds.

The mandate of the IRC is to review conflict of interest matters identified and referred to the IRC by the Manager and to give its approval or recommendation, depending on the nature of the conflict of interest matter. In each instance where a conflict of interest matter is identified and referred to the IRC, the focus of the IRC is to determine if the Manager’s proposed action achieves a fair and reasonable result for the Funds.

At least annually, the IRC will also review and assess the adequacy and effectiveness of the Manager’s policies and procedures relating to conflict of interest matters in respect of the Funds, and will conduct a self-assessment of the IRC’s independence, compensation and effectiveness.

The current members of the IRC are Louise Vaillancourt Châtillon (Chair), Allen B. Clarke and John K. McBride. Each member is independent of the Funds, the Manager and other companies related to the Manager. As of March 31, 2010, Kenneth W. McArthur and R. Jamie Plant retired from their positions as IRC members.

Each member is entitled to receive compensation for the duties he or she performs as an IRC member. For the most recently completed financial year of the Funds ended December 31, 2009, the IRC members, including Kenneth W. McArthur and R. Jamie Plant received aggregate annual fees and reimbursement of expenses of approximately $15,609, inclusive of goods and services tax. This amount was allocated among the Funds in a manner that was fair and reasonable.

For a further description of the mandate and responsibilities of the IRC, see “Fund Governance”.

Registrar

BMO Asset Management Inc., 77 King Street West, Suite 4200, Toronto, Ontario, M5K 1J5 is the registrar of each of the Funds.

Principal Distributor

The Manager acts as the principal distributor of the Funds. No remuneration has been paid to the Manager with respect to the distribution of the Funds.

Administration

Pursuant to the administration agreements entered into between the Manager, the Funds and Bank of Montreal Ireland PLC, Bank of Montreal Ireland PLC is responsible for providing certain administrative services to the Funds, such as fund accounting, reporting to unitholders and providing information regarding Fund accounts to unitholders. Each Fund pays a fee to Bank of Montreal Ireland PLC for such services.

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CONFLICTS OF INTEREST

Principal Holders of Securities

As at September 29, 2010, the only persons or companies who owned of record, or to the knowledge of the Manager, beneficially owned, directly or indirectly, more than 10% of the outstanding units of a class of a Fund were the following:

Fund Name Unitholder Name Type of Ownership

Number and Class of

Units

Percentage of

Outstanding Units of the

Class BMO Nesbitt Burns Canadian Stock Selection Fund

Investor A* Beneficial 1,926,499.32 Class I

99.9%

BMO Nesbitt Burns Bond Fund Investor B* Beneficial 33,866.71 Class F

23.3%

BMO Nesbitt Burns Balanced Fund

Investor C* Beneficial 2,247.79 Class F

10.1%

BMO Nesbitt Burns International Equity Fund

Investor D* Beneficial 24,928.61 Class A

10.5%

BMO Nesbitt Burns International Equity Fund

BMO Nesbitt Burns

Beneficial 100,912.23 Class A

42.6%

BMO Nesbitt Burns Balanced Portfolio Fund

Investor E* Beneficial 2,890.11 Class F

35.1%

BMO Nesbitt Burns Balanced Portfolio Fund

Investor F* Beneficial 3,548.68 Class F

43.0%

BMO Nesbitt Burns Balanced Portfolio Fund

BMO Nesbitt Burns

Beneficial 1,051.11 Class F

12.8%

BMO Nesbitt Burns Growth Portfolio Fund

Investor G* Beneficial 2,913.53 Class F

41.7%

BMO Nesbitt Burns Growth Portfolio Fund

Investor H* Beneficial 1,012.66 Class F

14.5%

BMO Nesbitt Burns Growth Portfolio Fund

Investor I* Beneficial 825.59 Class F

11.8%

BMO Nesbitt Burns Growth Portfolio Fund

Investor J* Beneficial 867.52 Class F

12.4%

BMO Nesbitt Burns Growth Portfolio Fund

BMO Nesbitt Burns

Beneficial 1,134.61 Class F

16.2%

BMO Nesbitt Burns Maximum Growth Portfolio Fund

Investor K* Beneficial 3,493.45 Class F

25.5%

BMO Nesbitt Burns Maximum Growth Portfolio Fund

Investor L* Beneficial 2,546.69 Class F

18.6%

* To protect the privacy of investors, we have omitted the names of the beneficial owners. This information is available on request by contacting us at the telephone number on the back cover of this annual information form.

As at September 29, 2010, the Trustees, directors and senior officers beneficially owned, in aggregate, less than 10% of the outstanding units of each class of each of the Funds, and the members of the IRC

- 25 - TOR_H2O:5597621.11

beneficially owned, in aggregate, less than 10% of the outstanding units of each class of each of the Funds.

Bank of Montreal is the beneficial owner, directly or indirectly, of approximately 100% of the issued and outstanding voting securities of BMO Nesbitt Burns, the manager, promoter and principal distributor of units of the Funds. To the knowledge of BMO Nesbitt Burns, no other person is the beneficial owner, directly or indirectly, of 10% or more of the outstanding voting securities of BMO Nesbitt Burns.

Affiliated Entities

Bank of Montreal Ireland PLC is a wholly-owned subsidiary of Bank of Montreal and is an affiliate of the Manager. BMOAM, Harris and Pyrford are indirect wholly-owned subsidiaries of Bank of Montreal and are affiliates of the Manager.

The relationship of the Manager and the relevant affiliated entities is as follows:

The total fees received by Bank of Montreal Ireland PLC from each Fund are set forth in the financial statements of the applicable Fund.

The Manager is a member of a group of related companies known as the “BMO Financial Group”. Applicable securities legislation contains restrictions on the circumstances under which the Funds, or the Manager on behalf of the Funds, may enter into transactions or arrangements with, or involving other members of, the BMO Financial Group or other related persons or companies, unless prior to such

U.S. Canada

49%

BANK OF MONTREAL

BANK OF MONTREAL IRELAND PLC

(wholly -owned subsidiary)

HARRIS FINANCIAL CORP. (wholly-owned subsidiary)

BANK OF MONTREAL HOLDING INC.

(wholly-owned subsidiary)

HARRIS BANKCORP, INC. (indirect subsidiary)

BANK OF MONTREAL SECURITIES CANADA LIMITED

(indirect wholly-owned subsidiary)

HARRIS INVESTMENT MANAGEMENT, INC.

(indirect subsidiary)

BMO NESBITT BURNS CORPORATION LIMTIED

(indirect wholly-owned subsidiary)

BMO NESBITT BURNS INC. (indirect wholly-owned subsidiary)

BMO ASSET MANAGEMENT INC.

(indirect subsidiary)

51%

BANK OF MONTREAL CAPITAL MARKETS (HOLDINGS) LIMITED

(wholly -owned subsidiary)

PYRFORD INTERNATIONAL LIMITED

(indirect wholly - owned subsidiary)

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transactions or arrangements the nature of the proposed transaction or arrangement and the relationship of the parties involved are disclosed to unitholders.

From time to time, the Manager may, on behalf of the Funds, enter into transactions or arrangements with or involving other members of the BMO Financial Group, or certain other persons or companies that are related or connected to the Manager or the Funds. These transactions or arrangements may include transactions or arrangements with or involving Bank of Montreal, BMOAM, Harris, Pyrford, Bank of Montreal Ireland PLC or other mutual funds, and may involve the purchase or sale of portfolio securities through or from a member of the BMO Financial Group, a mutual fund entering into forward contracts with a member of the BMO Financial Group acting as a counterparty, the purchase or redemption of units of other BMO Nesbitt Burns Group of Funds or the provision of services to the Manager. However, these transactions and arrangements will only be entered into where they are permitted under applicable securities legislation or by securities regulatory authorities having jurisdiction and where they are, in the opinion of the Manager, in the best interests of the Funds.

FUND GOVERNANCE

General Oversight

Seven individual Trustees, all of whom are employed by the Manager, govern the BMO Nesbitt Burns Group of Funds. The Trustees have the exclusive authority over the assets and business affairs of the Funds. The Trustees have delegated responsibility for the day-to-day management of the Funds to the Manager. The names and municipalities of residence of the Trustees can be found under the heading “Directors, Officers and Trustees”.

The board of directors of the Manager approves the appointments of officers of the Manager. The board reviews the firm’s organizational and procedural controls to ensure that they are appropriate and effective. The board meets on a quarterly basis and more frequently as the need arises.

To ensure that the Manager’s duties are carried out in the best interests of the Funds and their unitholders, the Manager has adopted a Code of Business Conduct (the “Code”) consisting of “First Principles – Working with Integrity” and “Information Security – Safeguarding Our Customers’ Trust”, which requires that we put the interests of our Funds ahead of all personal self-interests. Among other subjects, the Code deals with standards of conduct, confidential information, conflicts of interests, insider trading and other areas, including compliance with laws and regulations, and sanctions for breach of the Code.

The Manager has established appropriate policies, procedures, practices and guidelines to ensure the proper management of the Funds, including the policies and procedures relating to conflicts of interest as required by National Instrument 81-107. Included among these policies is a Personal Trading Policy, which must be followed by directors, officer and employees of BMO Nesbitt Burns and by specific employees of its affiliates. Under the policy, these individuals are required to obtain prior approval before placing a trade for their personal accounts. The Chief Compliance Officer of BMO Nesbitt Burns administers the Personal Trading Policy.

In addition, the BMO Nesbitt Burns Group of Funds has a Code of Ethics for Personal Investing in place, which must be followed by all access persons. An access person is defined as an employee of BMO Nesbitt Burns who has, or is able to obtain access to, non-public information concerning the portfolio holdings, the trading activities or the ongoing investment programs of a Fund. The code outlines in detail the framework governing the actions that an access person may or may not take, the requirements that

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must be fulfilled prior to taking action as well as the consequences of breaching the code. The Director of Compliance of BMO Private Client Group administers the Code of Ethics for Personal Investing.

Bank of Montreal Corporate Audit Department evaluates the systems of internal controls of the Manager. Any significant findings are presented on an annual basis to the audit committee of BMO Nesbitt Burns Corporation Limited, the parent company of the Manager. Shareholders’ auditors provide a copy of their audit report and assessment of internal control to BMO Nesbitt Burns. These reports are also tabled at a meeting of the board of directors of BMO Nesbitt Burns Corporation Limited.

Risk management is dealt with on a number of levels. The portfolio management agreements between the Manager and the portfolio advisors specify the objectives and strategies of a Fund, the investment restrictions and policies prescribed by the Canadian securities regulators and any additional guidelines and criteria considered by the Manager to be appropriate. Various measures to assess risk are used, including marked to market security valuation, fair value accounting, effective exposure reporting and monthly reconciliation of security and cash positions. Compliance monitoring of Funds’ portfolios is ongoing. The net asset values of the Funds are calculated daily, which helps to ensure that the valuation accurately reflects market movements.

Independent Review Committee

In accordance with NI 81-107, the Manager has appointed an IRC for the Funds. The mandate of the IRC is to:

(a) review the written policies and procedures established by the Manager and referred to the IRC in respect of conflict of interest matters;

(b) review conflict of interest matters referred to the IRC by the Manager and provide the Manager with an approval or a recommendation (an IRC decision) depending on the nature of the conflict of interest matter;

(c) perform any other function required of an independent review committee under applicable Canadian securities legislation; and

(d) perform any other function, as may be agreed to in writing by the IRC and the Manager, from time to time.

At least annually, the IRC will review and assess the adequacy and effectiveness of the Manager’s written policies and procedures relating to conflict of interest matters in respect of the Funds, in addition to any standing instructions the IRC has provided to the Manager to enable the Manager to act in respect of a particular conflict of interest matter on a continuing basis. This review will include an assessment of the Manager’s and the Funds’ compliance with the related policies and procedures and the conditions imposed by the IRC in the applicable standing instruction.

On an annual basis, the IRC will also conduct a self-assessment of the IRC’s independence, compensation and effectiveness. The IRC will provide the Manager with a report of the results of such self-assessment.

In accordance with NI 81-107, for each financial year of the Funds, the IRC will prepare a report to securityholders that describes the IRC and its activities for the financial year. Securityholders can get a copy of this report, at no cost, by calling 1-800-361-1392, by writing to us at contact.centre@bmonb.com or BMO Nesbitt Burns Inc., 1 First Canadian Place, 54th floor, Toronto, Ontario, M5X 1H3 or by visiting our website at www.bmonesbittburns.com or SEDAR at www.sedar.com.

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Proxy Voting Policies and Procedures

The Manager has delegated the voting of proxies of each Fund’s portfolio securities to that Fund’s portfolio advisor as part of the portfolio advisor’s management of the Fund’s portfolio, subject to the Manager’s continuing oversight. A portfolio advisor voting proxies on behalf of a Fund must do so in a manner consistent with the best interests of the Fund and its securityholders.

As part of its continuing oversight, the Manager has established policies and procedures to be followed by each Fund’s portfolio advisor, in conjunction with the portfolio advisor’s own policies and procedures, in determining how to vote on any matter for which the Funds receive proxy materials for a meeting of securityholders of an issuer. The policies and procedures established by the Manager (the “Proxy Policies”) include:

(a) a standing policy for dealing with routine matters on which a Fund may vote. In particular, the Proxy Policies apply general guidelines to a number of routine matters. These guidelines vary, depending on the specific matter involved. Routine matters include: election of directors; appointment of auditors; changes in capital structure; and an increase in authorized stock. While votes will be made on a case-by-case basis, the Funds will typically vote in favour of routine matters unless there are specific circumstances for voting against, as noted below;

(b) the circumstances under which a Fund will deviate from the standing policy for routine matters. The Proxy Policies provide that a Fund’s portfolio advisor may depart from the general guidelines with respect to routine matters in order to avoid voting decisions that may be contrary to the best interests of the Fund and the Fund’s securityholders. For example, the Proxy Policies provide that Funds will typically support management’s recommendations regarding the appointment of an auditor, but may vote against such a recommendation if the fees for services are excessive or if there are other reasons to question the independence or quality of the company’s auditors;

(c) the policies under which, and the procedures by which, a Fund will determine how to vote or refrain from voting on non-routine matters. These policies vary depending on the specific matter involved. Non-routine matters include: corporate restructurings; mergers and acquisitions; proposals affecting shareholder rights; corporate governance; executive compensation; and social and environmental issues. For example, with respect to shareholder rights, the Proxy Policies provide that the Funds will typically vote in favour of proposals that give shareholders a greater voice in the affairs of the company and oppose any measure that seeks to limit those rights; and

(d) procedures to ensure that portfolio securities held by a Fund are voted in accordance with the instructions of the Manager. This includes the requirement of each portfolio advisor to provide to the Manager on a quarterly basis a certificate confirming that it has voted all securities held by the Funds it manages in accordance with the Manager’s policies and procedures.

A conflict of interest may exist if a portfolio advisor, its personnel or another related entity has a business relationship with (or is actively soliciting business from) either the company soliciting the proxy or a third party that has a material interest in the outcome of a proxy vote or that is actively lobbying for a particular outcome of a proxy vote. Conflicts of interest also may arise if an individual employed by the portfolio advisor that is involved in the proxy vote decision has a direct or indirect personal relationship or other

- 29 - TOR_H2O:5597621.11

interest in either the company soliciting the proxy or in a third party that has a material interest in the outcome of a proxy vote or that is lobbying for a particular outcome of a proxy vote.

Each Fund’s portfolio advisor has procedures in place to identify potential conflicts of interest. When a Fund’s portfolio advisor becomes aware of any vote that presents a conflict, the portfolio advisor must vote such proxy question in a manner consistent with, and uninfluenced by considerations other than, the best interest of the Fund and its securityholders.

The policies and procedures that the Funds follow when voting proxies relating to portfolio securities are available on request, at no cost, by calling 1-800-361-1392 or by writing to the Manager of the Funds at 1 First Canadian Place, 54th floor, Toronto, Ontario, M5X 1H3.

Each Fund’s proxy voting record for the most recent period ended June 30 of each year will be available free of charge to any securityholder of the Fund upon request at any time after August 31 of the relevant year. The proxy voting record will also be available on the Funds’ website at www.bmonesbittburns.com.

Short-term Trading

The Manager has policies and procedures to detect and deter short-term or excessive trading that include the ability to refuse future order(s) to buy or switch units and charging a short-term trading fee.

BMO Nesbitt Burns monitors for potential timing abuses both in branch offices and at head office. It uses an electronic trade surveillance system to review and flag trades for potential problems and also reviews transaction records daily to detect short-term or excessive trading. Flagged trades are reviewed by compliance officers and warnings, verbal or written, may be sent. If, in the Manager’s sole discretion, it determines that a unitholder is engaging in short-term trading, in addition to other available remedies, the relevant Fund may reject the purchase or switch order(s) or may charge a short-term trading fee to be paid directly to the Fund out of the redemption proceeds, reducing the amount otherwise payable to the unitholder on the redemption or switch. The Manager has the option to waive this penalty at any time. If further short-term trading occurs, any further transactions, other than redemptions, may be refused.

The restrictions imposed on short-term trading, including the short-term trading fees, will generally not apply in connection with redemptions or switches initiated by the Manager; in special circumstances, as determined by the Manager in its sole discretion; and in the case of optional plans, including systematic withdrawal plans.

Derivatives Trading

Derivatives may be used by the Funds to reduce risk, as disclosed in the simplified prospectus.

The Manager may allow for the use of derivatives under certain conditions and limitations. Any derivative contracts entered into by a portfolio advisor on behalf of a Fund must be in accordance with the investment objectives and strategies of the Fund. The portfolio advisors are also required to adhere to applicable securities legislation and regulation or regulatory orders, including National Instrument 81-102. The Manager sets and reviews the investment policies of the Funds which may permit trading in derivatives.

If a Fund uses derivatives, the Manager may use various measures to assess risk, including mark to market security valuation, fair value accounting, monthly reconciliations of securities and cash positions. The effective exposure of derivatives in a Fund will be monitored by the Manager. Contracts will be held

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by an independent third party and derivative trading also may occur with a third party organization (mutually agreed upon by the Manager and the portfolio advisor). The Manager will have agreements with any such third party providers. Portfolio advisors will be required to regularly reconcile positions with the Manager and the Custodian. Portfolio advisors will also be required to certify compliance with the rules contained in applicable securities legislation on a quarterly basis.

Securities Lending Transactions, Repurchase Agreements and Reverse Repurchase Agreements

Certain of the Funds may enter into securities lending transactions and repurchase and reverse repurchase agreements in accordance with the rules of the Canadian Securities Administrators and only in a manner consistent with the investment objectives of the Funds.

In order to accomplish the transactions, the Manager may enter into an agency agreement with the Custodian of the Funds who will act as agent of the Funds. The agency agreement will describe the types of transactions that may be entered into by a Fund, the types of portfolio assets of the Funds that may be used, collateral requirements, limits on transaction sizes, permitted counterparties to the transactions and investment of any cash collateral. The agent will:

(a) ensure that collateral is provided in the form of cash, qualified securities or securities that can be converted into the securities which are the subject of the securities lending, repurchase or reverse repurchase transaction;

(b) value the loaned or purchased securities and the collateral every day to ensure that the market value of the collateral is at least 102% of the market value of the securities;

(c) invest any cash collateral in accordance with the investment restrictions specified in the agency agreement;

(d) invest no more than 50% of the total assets of a Fund in securities lending, repurchase or reverse repurchase transactions at any one time; and

(e) assess the creditworthiness of the counterparties to securities lending, repurchase or reverse repurchase transactions.

The agency agreement and the securities lending and repurchase and reverse repurchase arrangements are reviewed every year by the Manager to ensure that they comply with Canadian securities regulations and the Fund governance policies described above.

The risk factors associated with securities lending, repurchase and reverse repurchase transactions are disclosed in the simplified prospectus of the Funds. The agent will be responsible for managing the risks associated with securities lending, repurchase and reverse repurchase transactions. The agent has written guidelines that set out the objectives and goals with respect to securities lending arrangements, repurchase transactions and reverse repurchase transactions which are established and reviewed annually by the Manager. The agent is required to maintain internal controls, procedures and records (including a list of approved third parties based on factors such as creditworthiness), transaction and credit limits for each third party and collateral diversification standards. All securities lending, repurchase and reverse repurchase positions are reviewed by the agent as part of this compliance regime to ensure the Funds are within the existing control limits.

The Manager and the agent review, at least annually, the policies and procedures regarding the use of securities lending, repurchase and reverse repurchase transactions to ensure that the risks associated with

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these types of transactions are being properly managed. The board of directors of the Manager and the Trustees are updated regularly and are made aware of any pertinent developments with respect to securities lending, repurchase and reverse repurchase transactions.

Management Fee Distributions

To encourage large investments in the Funds the Manager may, from time to time, agree to reduce the fee that it otherwise would be entitled to receive from the Funds with respect to a unitholder’s investment in such Fund, provided that the amount of this reduction is distributed (a “Management Fee Distribution”) to such unitholder.

Management Fee Distributions, where applicable, will be calculated and credited to the relevant unitholder on each business day and distributed on a regular basis. The amount of such Management Fee Distribution to a unitholder depends primarily on the amount invested. Management Fee Distributions paid to one unitholder have no effect on any other unitholder. As with all distributions, Management Fee Distributions will be automatically reinvested in additional units at the net asset value per unit on the date of the distribution.

Any such reduction in fees in respect of a large investment is negotiable between the Manager, in its capacity as the principal distributor of units of the Funds, and the investor.

TAX STATUS OF THE FUNDS AND INVESTORS

In the opinion of Osler, Hoskin & Harcourt LLP, the following is a summary of the principal Canadian federal income tax considerations under the Tax Act for the Funds and for prospective investors in a Fund who, for the purposes of the Tax Act, are resident in Canada, hold units of the Fund as capital property, are not affiliated with the Funds, and deal with the Fund at arm’s length. This summary is based upon the current provisions of the Tax Act and regulations thereunder, all specific proposals to amend the Tax Act and such regulations publicly announced by the Minister of Finance (Canada) prior to the date hereof and counsel’s understanding of the current published administrative and assessing policies of the Canada Revenue Agency. This summary does not take into account or anticipate any other changes in law whether by legislative, administrative or judicial action and it does not take into account provincial, territorial or foreign income tax legislation or considerations.

This summary is of a general nature only and is not exhaustive of all possible income tax considerations. Prospective investors should therefore consult their own tax advisors about their individual circumstances. This summary does not apply to investors that are “financial institutions” for purposes of the mark-to-market rules in the Tax Act or investors to whom the functional currency reporting rules in the Tax Act apply.

This summary is based on the assumption that the Funds will comply at all material times with conditions prescribed in the Tax Act so as to qualify as “mutual fund trusts” as defined in the Tax Act. The Manager has confirmed to counsel that each of the Funds qualifies and will continue to qualify as a “mutual fund trust” under the Tax Act at all material times.

Tax Status of the Funds

The Master Declaration of Trust of the Funds requires that each Fund distribute its net income for tax purposes and net realized capital gains, if any, for each taxation year of the Fund to investors to such an extent that the Fund will not be liable in any taxation year for income tax under Part I of the Tax Act on

- 32 - TOR_H2O:5597621.11

such net income and net realized capital gains (after taking into account any applicable losses of the Fund and the capital gains refunds to which the Fund is entitled).

Each of the Funds is required to compute its net income and net realized capital gains in Canadian dollars for the purposes of the Tax Act. As a consequence, a Fund that invests in securities denominated in a currency other than the Canadian dollar may realize income or capital gains by virtue of changes in the value of the foreign currency relative to the Canadian dollar.

Gains and losses realized by a Fund or an underlying fund on derivatives or in securities lending or repurchase transactions may be treated on income account rather than as capital gains and capital losses. In certain circumstances, capital losses realized by the Funds on units of an underlying fund may, effectively, be denied and therefore not be available to shelter capital gains realized by the Funds.

If appropriate designations are made by the underlying funds in which a Fund invests, the nature of distributions from the underlying funds that are derived from taxable dividends received from taxable Canadian corporations (including eligible dividends), foreign income and capital gains will be preserved in the hands of the Fund for the purpose of computing its income. A Fund may also receive distributions of ordinary income and non-taxable amounts from the underlying funds. The nature of such amounts received by a Fund may be reflected in distributions from that Fund to its unitholders.

All of a Fund’s deductible expenses, including expenses common to all classes of units, and management fees and other expenses specific to a particular class of units, will be taken into account in determining the income or loss of the Fund as a whole.

Units of each of the Funds are a qualified investment for trusts governed by registered retirement savings plans, registered retirement income funds, registered disability savings plans, registered education savings plans, deferred profit sharing plans, life income funds, locked-in retirement income funds, locked-in retirement accounts and tax-free savings accounts (“Registered Plans”).

Tax Treatment of Investors

Funds held in Registered Plans

Distributions from a Fund to an investor, and gains realized on the disposition of units by an investor, that is a Registered Plan or that is a tax exempt pension plan will not, except in certain limited circumstances, be taxable in the plans; however, amounts withdrawn from such plans will generally be taxable (other than a withdrawal from a tax-free savings account, a withdrawal of contributions from a registered education savings plan, or certain withdrawals from a registered disability savings plan).

Funds held in Non-registered Accounts

An investor that does not hold units of the Funds in a Registered Plan will generally be required to include in the investor’s income for tax purposes for any year the amount, computed in Canadian dollars, of income and net taxable capital gains, if any, paid or payable by a Fund to the investor in the year, including any Management Fee Distributions paid out of the Fund’s income or taxable capital gains, whether or not such amounts are reinvested in additional units of the Fund.

If the amount of the actual distributions by a Fund to a unitholder for a year exceeds the Fund’s net income and net capital gains, the excess amount will, if so designated by the Fund, be included in the unitholder’s income in the same manner as other distributions. Alternatively, if such designation is not made by the Fund, the excess amount will not be included in the unitholder’s income but will reduce the

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adjusted cost base to the unitholder of the unitholder’s units of the Fund. Where a unitholder’s adjusted cost base would otherwise be a negative amount as of the end of any taxation year, the unitholder will be treated as realizing a capital gain for that taxation year, and the unitholder’s adjusted cost base at the beginning of the next year will be nil.

At the time that a unitholder acquires units of a Fund, the price of such units will be determined taking into account the Fund’s accrued but unrealized, or realized but undistributed, income and capital gains, if any. When these earnings or gains are realized and distributed to the unitholder, such amounts will be included in the unitholder’s income. However, if such distributions are reinvested in additional units of the Fund, the unitholder’s adjusted cost base will be increased by such reinvested amount which will reduce any capital gain realized on a later disposition of the units.

Each Fund will designate, to the extent permitted by the Tax Act, the portion of the net income distributed by it to investors as may reasonably be considered to consist of net taxable capital gains of the Fund and taxable dividends, including eligible dividends, received by the Fund on shares of taxable Canadian corporations. Any such designated amount will be deemed for tax purposes to be realized or received by investors in the year as a taxable capital gain and as a taxable dividend, including an eligible dividend if applicable, from a Canadian corporation, respectively. Distributions so deemed to be capital gains realized by investors are subject to the general rules relating to the taxation of capital gains described below. With respect to dividends in the case of an investor who is an individual, the dividend gross-up and tax credit treatment normally applicable to taxable dividends paid by a taxable Canadian corporation will apply to amounts so designated as taxable dividends. In the case of an investor that is a corporation, amounts designated as taxable dividends will be included in the corporation’s income for purposes of the Tax Act but normally will also be deductible in computing its taxable income. A private corporation that is entitled to deduct such dividends in computing its taxable income will generally be subject to the refundable tax under Part IV of the Tax Act. Certain public corporations that are controlled directly or indirectly by or for the benefit of an individual (other than a trust) or a related group of individuals (other than trusts) are also subject to the refundable tax under Part IV of the Tax Act. Corporations, other than private corporations, should consult their own tax advisors as to the possible application of tax under Part IV.1 of the Tax Act on amounts designated as taxable dividends.

In addition, where a Fund has earned foreign income or gains, the Fund may make designations in respect of such income or gains that are considered to be from foreign sources so that, for the purpose of computing any foreign tax credit available to an investor, and subject to the rules in the Tax Act, the investor will be deemed to have paid as tax to the government of a foreign country a portion of the taxes paid or considered to be paid by the Fund to that country.

An investor should consult its tax advisor regarding the deductibility for tax purposes of the management fees paid directly to the Manager by unitholders with respect to Class I units.

Investors will be informed each year of the composition of the amounts distributed to them in terms of net income, dividends from taxable Canadian corporations (including eligible dividends), net taxable capital gains, foreign source income and non-taxable amounts (such as a return of capital), and of the amount of any foreign taxes in respect of which the investor may claim a credit for tax purposes to the extent permitted by the Tax Act, where those items are applicable.

Upon the actual or deemed disposition of a unit, including on the redemption of a unit by a Fund and on the switching of an investor’s investment from one Fund to another Fund, a capital gain (or a capital loss) will generally be realized by the investor to the extent that the proceeds of disposition of the unit exceed (or are exceeded by) the aggregate of the adjusted cost base to the investor of the unit and any costs of disposition. A redesignation of a unit of one class of a Fund into a unit of another class of the same Fund

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will not result in a disposition of the unit redesignated. The unitholder’s total adjusted cost base of units that have been redesignated will be equal to the total adjusted cost base of the units that were redesignated. The adjusted cost base to an investor of a unit of a particular class of a Fund will generally be the average cost per unit of all the units of that class of the Fund held by the investor including units acquired on the reinvestment of distributions and including units redesignated into that class. In the case of a unitholder that holds units of BMO Nesbitt Burns U.S. Stock Selection Fund denominated in U.S. dollars, for purposes of calculating the unitholder’s capital gain or capital loss, the unitholder’s cost of a unit and proceeds of disposition of a unit will be determined in Canadian dollars at the appropriate exchange rate for purposes of the Tax Act on the date of acquisition and disposition respectively.

One-half of any capital gain realized by a unitholder (a “taxable capital gain”) will be included in income, and one-half of any capital loss realized by a unitholder will be treated as an “allowable capital loss” and may generally be deducted from taxable capital gains subject to and in accordance with detailed rules in the Tax Act.

Eligibility for Investment by Registered Plans

Units of each of the Funds are a qualified investment for Registered Plans.

Investors are responsible for determining the consequences to them under the relevant income tax legislation of acquiring units of the Funds through a Registered Plan and neither the Funds nor the Manager assumes any responsibility or liability to such persons as a result of making the units of the Funds available for investment.

Registered Plans

A person may open a Registered Plan such as a registered retirement savings plan, registered retirement income fund, registered disability savings plan, registered education savings plan, life income fund, locked in retirement account or retirement income fund, or tax free savings account by completing the appropriate application form and declaration of trust which may be obtained directly from the Fund, the Manager or from the person’s authorized sales agent. Following completion of the application and declaration of trust the purchased units of any of those Funds or other funds permitted by the Manager from time to time will be held by a licensed trust company which will act as trustee of the person’s Registered Plan and which will ensure that the plan is registered under all applicable legislation.

Additional details concerning such Registered Plans are listed on the application form and declaration of trust.

MATERIAL CONTRACTS

The only material contracts pertaining to the Funds are:

(a) the Master Declaration of Trust of the Funds, referred to under “Name, Formation and History of the Funds”;

(b) the management agreements referred to under “Responsibilities of the Manager”;

(c) the portfolio advisory agreements referred to under “Portfolio Advisors”; and

(d) the custodian agreement referred to under “Custodian of Portfolio Securities”.

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Copies of these contracts may be inspected at any time during normal business hours at the Funds’ head office.

LEGAL PROCEEDINGS

As of the date hereof, there are no material legal proceedings pending to which any of the Funds is a party or which involve its assets.

CERTIFICATES

A single simplified prospectus is being used to offer units of BMO Nesbitt Burns Canadian Stock Selection Fund, BMO Nesbitt Burns U.S. Stock Selection Fund, BMO Nesbitt Burns Bond Fund, BMO Nesbitt Burns Balanced Fund, BMO Nesbitt Burns International Equity Fund, BMO Nesbitt Burns Balanced Portfolio Fund, BMO Nesbitt Burns Growth Portfolio Fund and BMO Nesbitt Burns Maximum Growth Portfolio Fund because many of the attributes of the Funds and of the units of the Funds are similar. Each Fund is responsible for the disclosure in this annual information form relating to it and no Fund has any responsibility or liability for any misrepresentation relating to another Fund.

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AUDITORS’ CONSENT

We have read the simplified prospectus and related annual information form of the Funds dated October 15, 2010 relating to the issue and sale of units of the Funds. We have complied with Canadian generally accepted standards for an auditor’s involvement with offering documents.

We consent to the use, through incorporation by reference in the above-mentioned simplified prospectus, of our report to the unitholders of the Funds on the following financial statements of each of the Funds:

• Statements of net assets as at December 31, 2009 and 2008;

• Statements of investment portfolio as at December 31, 2009; and

• Statements of operations and changes in net assets for the years ended December 31, 2009 and 2008.

Our report is dated March 10, 2010.

(signed) “PricewaterhouseCoopers LLP” Chartered Accountants, Licensed Public Accountants Toronto, Ontario October 15, 2010

C-1 TOR_H2O:5597621.11

CERTIFICATE OF THE FUNDS

Dated: October 15, 2010

This annual information form, together with the simplified prospectus required to be sent or delivered to a purchaser during the currency of this annual information form and the documents incorporated by reference into the simplified prospectus, constitute full, true and plain disclosure of all material facts relating to the securities offered by the simplified prospectus, as required by the securities legislation of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Prince Edward Island, Nova Scotia, Newfoundland and Labrador, Yukon, Northwest Territories and Nunavut and do not contain any misrepresentations.

“SARAH E. A. WIDMEYER”

“ROBERT J. SCHAUER” SARAH E. A. WIDMEYER Chief Executive Officer of BMO Nesbitt Burns Group of Funds

ROBERT J. SCHAUER Chief Financial Officer of BMO Nesbitt Burns Group of Funds

On behalf of the Trustees:

“DARCY M. LAKE” “PATRICK W. J. FRENCH” DARCY M. LAKE Trustee

PATRICK W. J. FRENCH Trustee

C-2 TOR_H2O:5597621.11

CERTIFICATE OF THE MANAGER, THE PROMOTER AND THE PRINCIPAL DISTRIBUTOR OF THE FUNDS

Dated: October 15, 2010

This annual information form, together with the simplified prospectus required to be sent or delivered to a purchaser during the currency of this annual information form and the documents incorporated by reference into the simplified prospectus, constitute full, true and plain disclosure of all material facts relating to the securities offered by the simplified prospectus, as required by the securities legislation of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Prince Edward Island, Nova Scotia, Newfoundland and Labrador, Yukon, Northwest Territories and Nunavut and do not contain any misrepresentations.

“THOMAS V. MILROY”

“DAVID C. FERGUSON” THOMAS V. MILROY Chief Executive Officer BMO Nesbitt Burns Inc.

DAVID C. FERGUSON Chief Financial Officer BMO Nesbitt Burns Inc.

On behalf of the Board of Directors of BMO Nesbitt Burns Inc., the Manager, Promoter and Principal Distributor:

“GILLES G. OUELLETTE”

“ERIC C. TRIPP” GILLES G. OUELLETTE Director

ERIC C. TRIPP Director

TOR_H2O:5597621.11

BMO NESBITT BURNS CANADIAN STOCK SELECTION FUND BMO NESBITT BURNS U.S. STOCK SELECTION FUND

BMO NESBITT BURNS BOND FUND BMO NESBITT BURNS BALANCED FUND

BMO NESBITT BURNS INTERNATIONAL EQUITY FUND BMO NESBITT BURNS BALANCED PORTFOLIO FUND BMO NESBITT BURNS GROWTH PORTFOLIO FUND

BMO NESBITT BURNS MAXIMUM GROWTH PORTFOLIO FUND

BMO Nesbitt Burns Inc. 1 First Canadian Place

54th Floor Toronto, Ontario M5X 1H3

Email: contact.centre@bmonb.com

Additional information about the Funds is available in the Funds’ financial statements and management reports of fund performance.

You can get a copy of these documents at no cost by calling toll free 1-800-361-1392, on BMO Nesbitt Burns’ Internet site at www.bmonesbittburns.com, from your BMO Nesbitt Burns Investment Advisor or by email at contact.centre@bmonb.com.

These documents and other information about the Funds, such as information circulars and material contracts, are also available at www.sedar.com.

BMO Nesbitt Burns Inc. 1 First Canadian Place 54th Floor Toronto, Ontario M5X 1H3

Client Services Local and Toll Free: 1-800-361-1392 Fax: 866-486-2846

Email: contact.centre@bmonb.com

Website: www.bmonesbittburns.com

® “BMO (M bar roundel symbol)” is a registered trade-mark of Bank of Montreal, used under licence.

® “Nesbitt Burns” is a registered trade-mark of BMO Nesbitt Burns Corporation Limited, used under licence. Member CIPF.