BANK OF MONTREAL ANNUAL MEETING APRIL 1, 2014 Notice of Annual Meeting of Shareholders and Management Proxy Circular Your vote matters. Please take a moment to vote. Your participation as a Shareholder is important to us. This document tells you who can vote, what you will be voting on and how to vote. Your Vote Matters Choose to vote in one of three ways: ‰ Vote online by visiting www.investorvote.com (registered shareholders, including BMO employ- ees) or www.proxyvote.com (non-registered shareholders) ‰ Vote by returning the enclosed form of proxy or voting instruction form by mail or fax ‰ Vote in person at the annual meeting of Shareholders Detailed voting instructions for non-registered and registered shareholders can be found starting on page 7 of this Management Proxy Circular. Location of Annual Meeting Of Shareholders BMO Financial Group Institute for Learning 407 3550 Pharmacy Ave. Pearson Toronto, Ontario International Woodbine Ave Airport Yonge St Holiday Inn Steeles Ave Steeles East 53/53A PARKING 404 BMO Financial Group Located on the West side of the building. Institute for Learning Gordon Baker Road Finch Finch Ave N Pharmacy North 167 Victoria Park Ave Victoria Park Pharmacy Ave Sheppard Don Valley Parkway Don Mills Sheppard Ave 401 York Mills Ellesmere Ave Bus Route Yonge Subway Line and Go Bus Stop Sheppard Subway Line For more up-to-date bus/subway information, call Toronto Transit Commission at 416 393-4636. DIRECTIONS From West: ‰ 401 Eastbound to Don Valley Parkway (DVP) exit ‰ Take 404 North to Steeles and Woodbine exit (Exit 22) ‰ Stay right and turn right on to Steeles Avenue ‰ At the 3rd set of lights, turn right on Pharmacy Ave. and turn into 1st driveway on the right From East: ‰ 401 Westbound to Don Valley Parkway (DVP) exit ‰ Take 404 North to Steeles and Woodbine exit (Exit 22) ‰ Stay right and turn right on to Steeles Avenue ‰ At the 3rd set of lights, turn right on Pharmacy Ave. and turn into 1st driveway on the right From North: ‰ 404 South to Steeles and Woodbine exit (Exit 22) ‰ Turn left on to Steeles Avenue ‰ At the 4th set of lights, turn right on Pharmacy Ave. and turn into 1st driveway on the right From South: ‰ Don Valley Parkway (DVP) North which becomes 404 North ‰ Take Steeles and Woodbine exit (Exit 22) ‰ Stay right and turn right on to Steeles Avenue ‰ At the 3rd set of lights, turn right on Pharmacy Ave. and turn into 1st driveway on the right 1 Bank of Montreal Management Proxy Circular Letter to Shareholders Dear fellow Shareholder, Once a year we all meet to hear firsthand about the Bank’s direction and progress to date. It is time set aside to speak with management, ask questions of them directly and receive immediate answers. It is also our annual opportunity to vote on those matters that affect the governance of our company – and to choose the people who will represent us around the boardroom table when key decisions are made. On April 1, 2014, our Annual Meeting of Shareholders will be held at the Bank’s Institute for Learning in Toronto, the centrepiece of BMO’s commitment to continuing education. As an organization that is constantly evolving to keep pace with our customers, we welcome this chance to showcase our leadership in the development of people. In 2014, the Institute for Learning celebrates 20 years of delivering programs that span skills training, management education and leadership development – all designed to build a strong workforce and contribute to the future performance of the Bank. Your presence at the Annual Meeting is important. You can attend in person or online at www.bmo.com/home/about/banking/investor-relations/annual-general-meeting. And whether you attend in person or online, we strongly urge you to submit your proxy vote ahead of time and make your vote count. Your participation is important to your Board of Directors and the management team. Your vote matters. Please take the time to review this Management Proxy Circular and our 2013 Annual Report. In the Management Proxy Circular you will find an explanation of the matters we will be voting on, along with detailed voting instructions. While you may register your position on proxy matters through the mail, there are clear benefits to opting for secure and instantaneous online voting. In the Annual Report you will find detailed information about BMO’s performance over the past fiscal year. You can find the Annual Report on our website, along with the Bank’s quarterly results, presentations to the investment community and other useful information about BMO Financial Group. Your directors and the management team look forward to welcoming you on Tuesday, April 1. Over the past decade we have been steadily deepening BMO’s long-standing focus on customers and building the capabilities that grow loyalty and advocacy – and as a result, we are confident in our ability to thrive in this period of rapid change. We can only do so, however, with the involvement and support of our shareholders. We look forward to having you join the conversation. Sincerely, J. Robert S. Prichard William A. Downe Chairman of the Board Chief Executive Officer February 7, 2014 You may obtain an electronic copy of this Management Proxy Circular by downloading it from www.bmo.com/home/about/banking/corporate-governance or by calling the Corporate Secre- tary’s Department at (416) 867-6785. Bank of Montreal Management Proxy Circular 2 Table of Contents Invitation to Shareholders 2 Notice of Annual Meeting of Shareholders of Bank of Montreal 4 Management Proxy Circular 5 Annual Meeting of Shareholders 5 Management Proxy Circular 5 Date of Circular 5 Business of the Meeting 5 BMO’s Financial Statements 5 Electing the Board of Directors 5 Appointing Auditors 5 Voting on our Approach to Executive Compensation 6 Considering Shareholder Proposals 6 Voting Information 7 Items of Business 7 Who Can Vote 7 Voting Instructions for Non-registered Shareholders 7 Voting Instructions for Registered Shareholders 7 Voting by Proxy 7 Confidentiality 9 Contacting the Bank’s Transfer Agent 9 Questions at the Meeting 9 Shareholder Proposals Next Year 9 Directors 10 Nominees for Election to Board of Directors 10 Continuing Education and Skills 21 Directors’ Compensation and Attendance 24 Corporate Governance 28 Report of the Audit and Conduct Review Committee 28 Report of the Governance and Nominating Committee 29 Report of the Human Resources Committee 30 Report of the Risk Review Committee 31 Statement of Corporate Governance Practices 33 Board Mandate 43 Indebtedness of Directors and Executive Officers 44 Directors’ and Officers’ Insurance 45 Normal Course Issuer Bid 45 Shareholder Proposals 46 Compensation Discussion and Analysis 52 Message from the Chair of the Human Resources Committee 53 Compensation Governance and Oversight 57 BMO’s Approach to Executive Compensation 59 Compensation Program 66 2013 Results 74 2013 Compensation for the Named Executive Officers 79 Executive Compensation Tables 90 Other Information 97 Additional Disclosure 101 Directors’ Approval 103 3 Bank of Montreal Management Proxy Circular Notice of Annual Meeting of Shareholders of Bank of Montreal When: Tuesday, April 1, 2014 at 9:30 a.m. (local time) Where: BMO Financial Group Institute for Learning 3550 Pharmacy Avenue, Toronto, Ontario The meeting will be held for the following purposes: 1. receive the consolidated financial statements of Bank of Montreal (the “Bank”) for the financial year ended October 31, 2013; and the Shareholders’ auditors’ report on those statements; 2. elect the Board of Directors for 2014; 3. appoint the Shareholders’ auditors for 2014; 4. consider and, if deemed fit, approve an advisory resolution on the Bank’s approach to executive compensation; 5. consider the Shareholder proposals set out starting on page 46 of the management proxy circular; and 6. transact any other business properly brought before the meeting. Our website will carry live coverage of the meeting, as well as a recording after the meeting. Online, you can also find our 2013 Annual Report, our 2013 Environmental, Social and Governance Report and Public Accountability Statement, our quarterly results, presentations to the investment community, and other useful information about us. Holders of common shares (“Shares”) as at January 31, 2014, will be entitled to vote at the meeting. The number of eligible votes* that may be cast at the meeting is 644,598,227, such number being the total number of Shares of the Bank outstanding on January 31, 2014. Whether or not you plan to attend the meeting in person, please complete the enclosed form of proxy or voting instruction form and return it in the postage prepaid envelope provided, or follow the instructions on the form in order to vote your Shares. For your vote to be recorded, your proxy vote must be received by our transfer agent, Computershare Trust Company of Canada, no later than 5:00 p.m. (Eastern Daylight Time) on March 31, 2014. To vote in person at the meeting, please see the section “Voting Information” on page 7 of the management proxy circular. By order of the Board of Directors, Barbara M. Muir Corporate Secretary February 7, 2014 * The actual number of eligible votes may be fewer due to voting restrictions set forth in the Bank Act (Canada) as described on page 9 under “Who Cannot Vote”. Bank of Montreal Management Proxy Circular 4 Management Proxy Circular Annual Meeting of Shareholders The annual meeting of Shareholders of the Bank on April 1, 2014 is our opportunity to discuss the Bank’s performance and our plans for the future. It is also your opportunity to vote on important matters. We encourage you to vote.