Front Street

Canadian Hedge

Fund Investment Objectives

The Fund's investment objective is to provide holders of Units with long-term capital growth primarily through the selection and strategic trading of both long and short positions in equity, debt and derivative securities. The Fund's portfolio will consist primarily of investments which generate capital gains, but will also include investments which generate income. The Investment Advisor will make long term investments in securities which it believes are undervalued based on its traditional fundamental research and analysis of such securities. These will include, in particular, securities of issuers with improving fundamentals such as growing revenues and earnings, strong balance sheets and solid management, capital structure and business franchises. The Investment Advisor will manage the relative weightings of the Portfolio's long and short positions to achieve the Fund's investment objective. The Fund's net market exposure will depend on, among other things, the Investment Advisor's view of domestic and international economic and market trends. The total value of the Fund's short positions at any time will not exceed the total value of the Fund's long positions. As a result, the Fund will at no time have negative market exposure.