Sprott Hedge Funds June09

Sprott Hedge Fund L.P. (Class A) Sprott Asset Management LP Royal Bank Plaza, South Tower 200 Bay St., STE 2700 Toronto, ON., Canada M5J 2J1 Year 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000

Jan 12.12% -2.44% -2.86% 9.32% 1.33% 1.57% 0.79% 12.33% 3.52%

Feb 3.84% 17.24% 6.85% -2.89% 6.04% 5.19% 1.34% 13.37% 16.52%

Tel: Web: Email: Mar -3.02% -2.87% 4.12% 12.52% -3.08% 3.63% -6.44% 8.21% 3.71%

Apr -13.83% -5.51% 0.56% 4.91% -0.93% 1.42% -12.56% 11.44% 1.40%

416-943-6707 / 866-299-9906 www.sprott.com [email protected]

Benchmark 1: Benchmark 2:

Monthly Performance (%) Net of Fees May Jun Jul Aug Sep 5.92% -4.46% 12.77% 7.78% -9.87% -11.19% -12.78% -2.53% -0.18% 7.38% -9.52% 10.32% -4.98% -3.00% 4.37% 2.25% -8.28% -3.96% -0.56% 2.37% 2.21% 8.14% -3.17% -2.34% 5.42% -0.72% 7.54% -7.28% -3.95% 5.57% 5.94% 3.87% 8.15% -1.24% 4.12% 4.69% 6.21% 1.17% 11.32% 5.73% 5.63% 8.48%

S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity Oct

Nov

Dec

-4.15% 6.05% 2.98% -3.89% 0.15% 4.26% -11.05% -0.53%

11.82% -2.76% 8.31% -3.43% 6.91% 2.33% -9.04% -5.38% 4.90%

0.19% 5.98% -0.47% 8.14% -1.91% 2.14% 13.25% 0.84% 1.50%

Year -1.55% -4.35% 23.85% 25.50% 11.90% 25.51% -5.79% 73.97% 64.24% 6.47%

Fund Description The Sprott Hedge Fund L.P. (the “Fund”) investment objective is to maximize absolute returns on investments. The Fund intends to accomplish its set objective through superior securities selection by taking both long and short investment positions. The Fund’s managers may also execute arbitrage strategies, seek spin-off opportunities and participate in select private placements in order to maximize investment returns. The investment team will vary the allocation of long and short positions depending on their view of the domestic and international economy and market trends including liquidity flows within the U.S. financial system. The Fund will overweight certain industry sectors and asset classes, such as cash and gold when deemed appropriate by the Investment Manager. Statistical Analysis 22.76% Standard Deviation 1.72% Downside Deviation (10.0%) 489.13% Total Positive Months $5,891 Total Down Months 112.55% Largest Monthly Gain -26.21% Largest Monthly Loss

Compound Rate of Return (Annualized) Compound Rate of Return (Monthly) Cumulative Return (Since Inception) Cumulative VAMI (Growth of $1,000) Best 12-month Return Worst 12-month Return Growth of Initial Investment ($1,000)

Distribution of Monthly Returns

Sprott Hedge Fund L.P. (Class A) S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity*

Comparative Analytics vs. Benchmarks Compound Rate of Return (Annualized) Performance (YTD) Sharpe Ratio (5.0%) Sortino Ratio (10.0%) Alpha Annualized Alpha Beta Correlation R-squared * Figures updated as at May 29, 2009

22.76% -1.55% 0.80 0.77

14 12 10 8 6 4 2 0 < -10% -10 to -9 -9 to -8 -8 to -7 -7 to -6 -6 to -5 -5 to -4 -4 to -3 -3 to -2 -2 to -1 -1 to 0 0 to 1 1 to 2 2 to 3 3 to 4 4 to 5 5 to 6 6 to 7 7 to 8 8 to 9 9 to 10 > 10%

N ov M -00 ay N -01 ov M -01 ay N -02 ov M -02 ay N -03 ov M -03 ay N -04 ov M -04 ay N -05 ov M -05 ay N -06 ov M -06 ay N -07 ov M -07 ay N -08 ov M -08 ay -0 9

Monthly Periods

$9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0

Sprott Hedge Fund L.P. (Class A)

22.94% 13.71% 65 39 17.24% -13.83%

Return Range (%)

Credit

S&P 500 Suisse/Tre Index mont HFI (CAD) L/S Equity* -7.99% 5.07% -2.91% 8.25% -0.87 0.05 -1.37 -0.72 1.54% 1.70% 20.06% 22.42% -0.66 0.68 -0.40 0.22 0.16 0.05

Fund Information Eric Sprott Lead Portfolio Manager CLOSED Fund Status Fund Assets Under Management $489 million Net Asset Value Per Unit $58.91 Management Fee / Incentive Fee 2% / 20% over 10% hurdle Minimum Initial Subscription / Term $150,000 / 6 month lock-up Redemptions Monthly (60 Day Notice Period) Fund Code SPR 002 Fund Administrator Citigroup Legal Counsel Heenan Blaikie LLP Auditors Ernst & Young LLP

Sprott Hedge Fund L.P. II (Class A)

Sprott Asset Management LP Royal Bank Plaza, South Tower 200 Bay St., STE 2700 Toronto, ON., Canada M5J 2J1 Year 2009 2008 2007 2006 2005 2004 2003 2002

Jan 9.02% -2.33% -2.61% 8.96% 1.30% 1.60% 0.11%

Feb 4.91% 16.44% 6.40% -3.07% 5.76% 5.28% 0.84%

Tel: Web: Email: Mar -3.01% -2.08% 3.86% 11.26% -3.11% 3.09% -7.23%

Apr -13.20% -5.93% 0.54% 4.28% -0.71% 1.45% -11.74%

416-943-6707 / 866-299-9906 www.sprott.com [email protected]

Benchmark 1: Benchmark 2:

Monthly Performance (%) Net of Fees May Jun Jul Aug 4.74% -4.69% 12.93% 8.04% -8.84% -9.48% -2.52% -0.37% 7.44% -8.52% -4.99% -3.02% 4.15% 2.14% -3.32% -0.46% 2.33% 1.64% -2.65% -2.41% 5.26% -0.31% -6.91% -3.57% 4.84% 5.57%

Sep -8.73% 8.47% -8.37% 7.18% 6.34% 3.73% 3.20%

S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity Oct

Nov

-0.65% 11.46% 5.64% -2.19% 3.04% 8.26% -3.69% -2.52% 0.00% 7.02% 4.34% 2.26% -11.14% -11.67%

Dec -0.44% 6.19% -0.64% 6.51% -2.97% 1.98% 16.79%

Year -3.88% 6.12% 22.92% 21.99% 10.56% 23.15% -7.29% -5.40%

Fund Description The Sprott Hedge Fund L.P. II (the “Fund”) investment objective is to maximize absolute returns on investments. The Fund intends to accomplish its set objective through superior securities selection by taking both long and short investment positions. The Fund’s managers may also execute arbitrage strategies, seek spin-off opportunities and participate in select private placements in order to maximize investment returns. The investment team will vary the allocation of long and short positions depending on their view of the domestic and international economy and market trends including liquidity flows within the U.S. financial system. The Fund will overweight certain industry sectors and asset classes, such as cash and gold when deemed appropriate by the Investment Manager. Compound Rate of Return (Annualized) Compound Rate of Return (Monthly) Cumulative Return (Since Inception) Cumulative VAMI (Growth of $1,000) Best 12-month Return Worst 12-month Return Growth of Initial Investment ($1,000)

Statistical Analysis 9.21% Standard Deviation 0.74% Downside Deviation (10.0%) 82.63% Total Positive Months $1,826 Total Down Months 49.50% Largest Monthly Gain -22.30% Largest Monthly Loss Distribution of Monthly Returns

$2,400 $2,200

21.86% 14.41% 45 37 16.79% -13.20%

10 Monthly Periods

$2,000 $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600

8 6 4 2

Sprott Hedge Fund L.P. II (Class A) S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity*

< -10% -10 to -9 -9 to -8 -8 to -7 -7 to -6 -6 to -5 -5 to -4 -4 to -3 -3 to -2 -2 to -1 -1 to 0 0 to 1 1 to 2 2 to 3 3 to 4 4 to 5 5 to 6 6 to 7 7 to 8 8 to 9 9 to 10 > 10%

Se p0 M 2 ar -0 Se 3 p0 M 3 ar -0 Se 4 p0 M 4 ar -0 Se 5 p0 M 5 ar -0 Se 6 p0 M 6 ar -0 Se 7 p0 M 7 ar -0 Se 8 p0 M 8 ar -0 9

0

Return Range (%)

Credit

Comparative Analytics vs. Benchmarks Compound Rate of Return (Annualized) Performance (YTD) Sharpe Ratio (5.0%) Sortino Ratio (10.0%) Alpha Annualized Alpha Beta Correlation R-squared

* Figures updated as at May 29, 2009

Sprott Hedge Fund L.P. II (Class A)

9.21% -3.88% 0.29 -0.05

S&P 500 Suisse/Tre Index mont HFI (CAD) L/S Equity* -4.16% 7.56% -2.91% 8.25% -0.61 0.35 -1.15 -0.35 0.76% 0.46% 9.56% 5.63% -0.61 0.86 -0.38 0.30 0.14 0.09

Fund Information Eric Sprott Lead Portfolio Manager OPEN Fund Status Fund Assets Under Management $532 million Net Asset Value Per Unit $18.26 Management Fee / Incentive Fee 2% / 20% $150,000† Minimum Initial Subscription Term 6 month lock-up period Contributions Monthly Redemptions Monthly (60 Day Notice Period) Fund Code SPR 004 Fund Administrator Citigroup Legal Counsel Heenan Blaikie LLP Auditors Ernst & Young LLP † $25,000 minimum available to accredited investors

Sprott Bull/Bear RSP Fund (Class A) Sprott Asset Management LP Royal Bank Plaza, South Tower

Tel:

416-943-6707 / 866-299-9906

200 Bay St., STE 2700 Toronto, ON., Canada M5J 2J1

Web: Email:

www.sprott.com [email protected]

Year 2009 2008 2007 2006 2005 2004 2003 2002

Jan 8.87% -2.38% -2.58% 9.30% 1.13% 1.59% 0.57%

Feb 4.93% 16.47% 6.38% -2.66% 5.77% 4.69% 1.13%

Mar -3.36% -2.09% 4.19% 11.89% -2.88% 3.17% -6.17%

Apr -12.70% -5.81% 0.00% 5.01% -1.25% 0.72% -10.96%

Benchmark 1: Benchmark 2:

Monthly Performance (%) Net of Fees May Jun Jul Aug 6.02% -5.25% 12.43% 7.51% -9.08% -9.33% -2.39% 0.22% 7.77% -8.86% -5.00% -3.06% 3.79% 2.55% -2.84% -0.16% 2.28% 1.91% -2.51% -1.84% 4.32% -0.36% -5.82% -3.80% 3.95% 5.70%

S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity

Sep

Oct

Nov

Dec

-9.37% 8.70% -8.30% 7.34% 6.86% 3.60%

3.43% 6.03% 2.98% -3.78% -0.17% 4.34%

11.11% -2.55% 7.91% -2.42% 6.77% 2.70% -9.20%

-0.26% 5.73% -0.70% 6.67% -2.22% 2.02% 15.86%

Year -3.18% 8.18% 23.21% 23.98% 11.51% 22.42% -4.18% 5.20%

Fund Description The Sprott Bull/Bear RSP Fund (the “Fund”) investment objective is to maximize absolute returns on investments. The Fund intends to accomplish its set objective through superior securities selection by taking both long and short investment positions. The Investment Managers intend to invest in opportunities that provide what they, at the time of investment, believe to be the best reward per unit of risk. Allocations of long and short positions will depend on the investment teams view of the domestic and international economy and market trends including liquidity flows within the U.S. financial system. The Fund will overweight certain industry sectors and asset classes, such as cash and gold when deemed appropriate by the Investment Manager. Statistical Analysis 12.63% Standard Deviation 1.00% Downside Deviation (10.0%) 120.88% Total Positive Months $2,209 Total Down Months 47.84% Largest Monthly Gain -17.09% Largest Monthly Loss

Compound Rate of Return (Annualized) Compound Rate of Return (Monthly) Cumulative Return (Since Inception) Cumulative VAMI (Growth of $1,000) Best 12-month Return Worst 12-month Return Growth of Initial Investment ($1,000)

Distribution of Monthly Returns

Sprott Bull/Bear RSP Fund (Class A) S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity*

Comparative Analytics vs. Benchmarks Compound Rate of Return (Annualized) Performance (YTD) Sharpe Ratio (5.0%) Sortino Ratio (10.0%) Alpha Annualized Alpha Beta Correlation R-squared

12.63% -3.18% 0.44 0.17

12 10 8 6 4 2 0 < -10% -10 to -9 -9 to -8 -8 to -7 -7 to -6 -6 to -5 -5 to -4 -4 to -3 -3 to -2 -2 to -1 -1 to 0 0 to 1 1 to 2 2 to 3 3 to 4 4 to 5 5 to 6 6 to 7 7 to 8 8 to 9 9 to 10 > 10%

N ov -0 M 2 ay -0 N 3 ov -0 M 3 ay -0 N 4 ov -0 M 4 ay -0 N 5 ov -0 M 5 ay -0 N 6 ov -0 M 6 ay -0 N 7 ov -0 M 7 ay -0 N 8 ov -0 M 8 ay -0 9

Monthly Periods

$2,850 $2,600 $2,350 $2,100 $1,850 $1,600 $1,350 $1,100 $850 $600

Sprott Bull/Bear RSP Fund (Class A)

21.13% 13.32% 45 34 16.47% -12.70%

Return Range (%)

Credit

S&P 500 Suisse/Tre Index mont HFI (CAD) L/S Equity* -3.94% 7.82% -2.91% 8.25% -0.62 0.38 -1.17 -0.31 1.03% 0.70% 13.04% 8.78% -0.60 0.85 -0.36 0.31 0.13 0.10

Fund Information Eric Sprott Lead Portfolio Manager OPEN Fund Status Fund Assets Under Management $145 million Net Asset Value Per Unit†† $8.84 Management Fee / Incentive Fee 2% / 20% Minimum Initial Subscription $150,000† Term 180 Days (3% Penalty) Contributions Monthly Redemptions Monthly (7 calendar days notice) Fund Code SPR 005 Fund Administrator RBC Dexia Legal Counsel Heenan Blaikie LLP Auditors Ernst & Young LLP † $25,000 minimum available to accredited investors

* Figures updated as at May 29, 2009

†† Post-distribution of $2.24 at 12/31/2008

Sprott Opportunities Hedge Fund L.P. (Class A) Sprott Asset Management LP Royal Bank Plaza, South Tower 200 Bay St., STE 2700 Toronto, ON., Canada M5J 2J1 Year 2009 2008 2007 2006 2005 2004

Jan 0.65% -2.35% 0.05% 7.30% 5.39%

Feb -0.19% 5.79% 4.17% -0.83% 7.47%

Tel: Web: Email: Mar -0.08% -0.48% -0.48% 3.90% -1.54%

Apr 0.15% -0.37% 3.49% 3.18% -1.44% 0.00%

416-943-6707 / 866-299-9906 www.sprott.com [email protected]

Benchmark 1: Benchmark 2:

Monthly Performance (%) Net of Fees May Jun Jul Aug 1.49% -0.49% 6.72% 0.88% -3.84% -2.21% 0.04% 4.19% 3.12% -2.90% -0.97% -1.25% 2.68% -0.60% 1.06% 3.22% 6.93% 3.63% 1.80% 1.38% 0.87% 2.11%

S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity

Sep

Oct

Nov

Dec

-2.74% 2.74% -2.58% 4.02% 11.10%

-1.11% 2.63% 0.71% -0.99% 1.52%

0.77% -2.60% -0.94% 1.67% 8.76%

-0.19% 3.71% 3.42% 4.38% 5.21%

Year 1.53% 0.31% 19.32% 14.44% 38.85% 37.20%

Fund Description The Sprott Opportunities Hedge Fund L.P. (the "Fund") investment objective is to provide long term capital growth through fundamental securities selection by taking both long and short investment positions primarily in equity securities. The allocation of long and short positions will vary depending on the opportunities the Investment Manager believes have the best reward per unit of risk. In executing the strategy, the following investment techniques will be employed: 1) Investing long in undervalued securities; 2) Short selling overvalued securities; 3) Managing long and short positions; 4) Strategic use of leverage; 5) Pairs trading. The manager will also execute convertible and warrant arbitrage strategies; enter into private placements and IPO's; and buy or sell commodities in an attempt to maximize returns. The Partnership has no geographic, industry sector, asset class or market capitalization restrictions. Statistical Analysis 20.47% Standard Deviation 1.56% Downside Deviation (10.0%) 164.96% Total Positive Months $2,650 Total Down Months 63.97% Largest Monthly Gain -7.64% Largest Monthly Loss

Compound Rate of Return (Annualized) Compound Rate of Return (Monthly) Cumulative Return (Since Inception) Cumulative VAMI (Growth of $1,000) Best 12-month Return Worst 12-month Return Growth of Initial Investment ($1,000)

Distribution of Monthly Returns

Sprott Opportunities Hedge Fund L.P. (Class A) S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity*

Comparative Analytics vs. Benchmarks Compound Rate of Return (Annualized) Performance (YTD) Sharpe Ratio (5.0%) Sortino Ratio (10.0%) Alpha Annualized Alpha Beta Correlation R-squared

* Figures updated as at May 29, 2009

20.47% 1.53% 1.33 1.81

14 12 10 8 6 4 2 0 < -10% -10 to -9 -9 to -8 -8 to -7 -7 to -6 -6 to -5 -5 to -4 -4 to -3 -3 to -2 -2 to -1 -1 to 0 0 to 1 1 to 2 2 to 3 3 to 4 4 to 5 5 to 6 6 to 7 7 to 8 8 to 9 9 to 10 > 10%

Ap rAu 04 gDe 0 4 cAp 04 rAu 05 gDe 0 5 cAp 05 rAu 06 gDe 0 6 cAp 06 rAu 07 gDe 0 7 cAp 07 rAu 08 gDe 0 8 cAp 08 r09

Monthly Periods

$2,900 $2,600 $2,300 $2,000 $1,700 $1,400 $1,100 $800 $500

Sprott Opportunities Hedge Fund L.P. (Class A)

10.82% 4.28% 40 23 11.10% -3.84%

Return Range (%)

Credit

S&P 500 Suisse/Tre Index mont HFI (CAD) L/S Equity* -6.25% 5.66% -2.91% 8.25% -0.81 0.12 -1.34 -0.56 1.60% 1.27% 21.02% 16.36% -0.01 0.75 -0.01 0.59 0.00 0.35

Fund Information Jamie Horvat and Charles Oliver Portfolio Managers Fund Status OPEN Fund Assets Under Management $362 million Net Asset Value Per Unit $26.49 Management Fee / Incentive Fee 2% / 20% Minimum Initial Subscription $150,000† Term 6 month lock-up period Redemptions Monthly (30 Day Notice Period) Fund Code SPR 009 Fund Administrator RBC Dexia Legal Counsel Heenan Blaikie LLP Auditors Ernst & Young LLP † $25,000 minimum available to accredited investors

Sprott Opportunities RSP Fund

Sprott Asset Management LP Royal Bank Plaza, South Tower 200 Bay St., STE 2700 Toronto, ON., Canada M5J 2J1 Year 2009 2008 2007 2006 2005

Jan 0.70% -2.38% 0.00% 7.34%

Feb -0.21% 5.81% 4.17% -0.89%

Tel: Web: Email: Mar -0.14% -0.54% -0.48% 3.85%

Apr 0.14% -0.34% 3.46% 3.19%

416-943-6707 / 866-299-9906 www.sprott.com [email protected]

Benchmark 1: Benchmark 2:

Monthly Performance (%) Net of Fees May Jun Jul Aug Sep 1.53% -0.55% 6.70% 0.83% -3.81% -2.25% -2.77% 0.00% 4.20% 3.06% -2.90% 2.76% -1.00% -1.26% 2.65% -0.58% -2.60%

S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity Oct

Nov

Dec

-1.11% 2.61% 0.68% -1.10%

0.77% -2.62% -0.94% 1.72%

-0.21% 3.70% 3.45% 4.27%

Year 1.47% 0.14% 19.10% 14.30% 4.90%

Fund Description The Sprott Opportunities RSP Fund (the "Fund") investment objective is to provide long term capital growth through fundamental securities selection by taking both long and short investment positions primarily in equity securities. The allocation of long and short positions will vary depending on the opportunities the Investment Manager believes have the best reward per unit of risk. In executing the strategy, the following investment techniques will be employed: 1) Investing long in undervalued securities; 2) Short selling overvalued securities; 3) Managing long and short positions; 4) Strategic use of leverage; 5) Pairs trading. The manager will also execute convertible and warrant arbitrage strategies; enter into private placements and IPO's; and buy or sell commodities in an attempt to maximize returns. The Partnership has no geographic, industry sector, asset class or market capitalization restrictions. Statistical Analysis 10.43% Standard Deviation 0.83% Downside Deviation (10.0%) 45.10% Total Positive Months $1,451 Total Down Months 21.31% Largest Monthly Gain -7.76% Largest Monthly Loss

Compound Rate of Return (Annualized) Compound Rate of Return (Monthly) Cumulative Return (Since Inception) Cumulative VAMI (Growth of $1,000) Best 12-month Return Worst 12-month Return Growth of Initial Investment ($1,000)

9.29% 4.91% 24 21 7.34% -3.81%

Distribution of Monthly Returns

$1,700

$1,300 $1,100 $900 $700

O

ct -0 5 Ja n06 Ap r06 Ju l-0 6 O ct -0 6 Ja n07 Ap r07 Ju l-0 7 O ct -0 7 Ja n08 Ap r08 Ju l-0 8 O ct -0 8 Ja n09 Ap r09

$500

12 10 8 6 4 2 0 < -10% -10 to -9 -9 to -8 -8 to -7 -7 to -6 -6 to -5 -5 to -4 -4 to -3 -3 to -2 -2 to -1 -1 to 0 0 to 1 1 to 2 2 to 3 3 to 4 4 to 5 5 to 6 6 to 7 7 to 8 8 to 9 9 to 10 > 10%

Monthly Periods

$1,500

Return Range (%)

Sprott Opportunities RSP Fund S&P 500 Index (CAD) Credit Suisse/Tremont HFI L/S Equity*

Credit

Comparative Analytics vs. Benchmarks Compound Rate of Return (Annualized) Performance (YTD) Sharpe Ratio (5.0%) Sortino Ratio (10.0%) Alpha Annualized Alpha Beta Correlation R-squared

* Figures updated as at May 29, 2009

Sprott Opportunities RSP Fund

10.43% 1.47% 0.59 0.07

S&P 500 Suisse/Tre Index mont HFI (CAD) L/S Equity* -7.44% 4.11% -2.91% 8.25% -0.85 -0.04 -1.36 -0.67 0.84% 0.67% 10.52% 8.40% -0.05 0.60 -0.07 0.61 0.01 0.37

Fund Information Charles Oliver and Jamie Horvat Portfolio Managers Fund Status OPEN Fund Code SPR 091 Fund Assets Under Management $97 million Management Fee / Incentive Fee 2% / 20% Minimum Initial Subscription 150000† Term 180 days (3% penalty) Net Asset Value Per Unit $14.51 Redemptions Monthly (30 Day Notice Period) Fund Administrator RBC Dexia Legal Counsel Heenan Blaikie LLP Auditors Ernst & Young LLP † $25,000 minimum available to accredited investors

Sprott Small Cap Hedge Fund

Sprott Asset Management LP Royal Bank Plaza, South Tower 200 Bay St., STE 2700 Toronto, ON., Canada M5J 2J1

Tel: Web: Email:

416-943-6707 / 866-299-9906 www.sprott.com [email protected]

Benchmark 1: Benchmark 2:

S&P/TSX SmallCap Total Return Index Credit Suisse/Tremont HFI L/S Equity

Monthly Performance (%) Net of Fees Year 2009 2008 2007

Jan 7.71% -8.76%

Feb -0.89% 8.12% 7.53%

Mar 8.95% -5.77% 1.17%

Apr 3.29% 1.05% 9.14%

May 10.69% 13.96% 3.48%

Jun 0.52% 0.58% -0.40%

Jul

Aug

Sep

-8.39% 1.07%

-3.01% -9.20%

-21.75% 6.48%

Oct

Nov

-24.44% -10.90% 7.07% -7.89%

Dec -2.56% 4.00%

Year 33.67% -50.89% 22.65%

Fund Description The Sprott Small Cap Hedge Fund's investment objective is to provide unitholders with long-term capital growth. The Fund invests primarily in Canadian equity securities, with a significant bias toward small to medium capitalization stocks where the pricing of securities is less efficient. The Manager uses a variety of tools in order to assess a security before it enters the portfolio. The tools include quantitative and qualitative factors. The Manager uses a database of over 700 small and medium size securities to screen for those with strong earnings growth, high returns on equity, reasonable valuations and strong balance sheets. The Manager meets with over 500 management teams a year in order to qualitatively assess their investment merit. Preference is given to those companies that fit the Manager's "growth at a reasonable price" criteria. The above-mentioned factors form the basis of the Manager's decision making process to select those stocks which should be purchased and those which should be shorted. Statistical Analysis 33.67% Standard Deviation -0.74% Downside Deviation (10.0%) -19.49% Total Positive Months $805 Total Down Months 31.53% Largest Monthly Gain 25.89% Largest Monthly Loss

Compound Rate of Return (Annualized) Compound Rate of Return (Monthly) Cumulative Return (Since Inception) Cumulative VAMI (Growth of $1,000) Standard Deviation Downside Deviation (10.0%) Growth of Initial Investment ($1,000)

31.53% 25.89% 17 12 13.96% -24.44%

Distribution of Monthly Returns

$1,400

4 Monthly Periods

$1,200

$800 $600 Jun-09

Apr-09

Feb-09

Oct-08

Dec-08

Jun-08

Aug-08

Apr-08

Feb-08

Dec-07

Oct-07

Aug-07

Jun-07

Apr-07

Feb-07

$400

Sprott Small Cap Hedge Fund S&P/TSX SmallCap Total Return Index Credit Suisse/Tremont HFI L/S Equity*

Comparative Analytics vs. Benchmarks Compound Rate of Return (Annualized) Performance (YTD) Sharpe Ratio (5.0%) Sortino Ratio (10.0%) Alpha Annualized Alpha Beta Correlation R-squared

* Figures updated as at May 29, 2009

-16.93% 17.92% -0.71 -1.11 0.92% 11.65% 1.03 0.89 0.79

2 1 0

Return Range (%)

Sprott S&P/TSX Credit Small Cap SmallCap Suisse/Tre Hedge Total Return mont HFI Fund Index L/S Equity*

-8.58% 33.67% -0.28 -0.70

3

< -10% -10 to -9 -9 to -8 -8 to -7 -7 to -6 -6 to -5 -5 to -4 -4 to -3 -3 to -2 -2 to -1 -1 to 0 0 to 1 1 to 2 2 to 3 3 to 4 4 to 5 5 to 6 6 to 7 7 to 8 8 to 9 9 to 10 > 10%

$1,000

-1.04% 8.25% -0.50 -1.08 -0.24% -2.82% 2.69 0.90 0.81

Fund Information Director of Small Cap Investments Allan Jacobs Investment Strategist Peter Imhof Fund Status OPEN Launch Date January 31, 2007 Fund Assets Under Management $22 million Net Asset Value Per Unit $8.05 Management Fee / Incentive Fee 2% / 20% Minimum Initial Subscription $150,000† Term 1 Year hold period (or 5% penalty) Redemptions Monthly (30 Day Notice Period) Fund Code SPM 400 Prime Broker Scotia Capital Inc. Fund Valuation SGGG Fund Services Inc. Legal Counsel Heenan Blaikie LLP Auditors PricewaterhouseCoopers LLP † $25,000 minimum available to accredited investors

Sprott Bull/Bear RSP Fund, Sprott Global Market Neutral Fund, Sprott Hedge Fund L.P., Sprott Hedge Fund L.P. II, Sprott Opportunities Hedge Fund L.P., Sprott Opportunities RSP Fund, Sprott Peak Oil Fund and the Sprott Small Cap Hedge Fund are offered on a private placement basis pursuant to an offering memorandum and are only available to investors who meet certain eligibility or minimum purchase amount requirements under applicable securities legislation. The offering memorandum contains important information about the "Funds", including their investment objective and strategies, purchase options, applicable management fees, performance fees, other charges and expenses, and should be read carefully before investing. Performance data represents past performance of the Fund and is not indicative of future performance. Data based on performance history of less than five years may not give prospective investors enough information to base investment decisions on. Please contact your own personal advisor on your particular circumstance. This communication does not constitute an offer to sell or solicitation to purchase securities of the Fund. The information contained herein does not constitute an offer or solicitation by anyone in the United States or in any other jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Prospective investors who are not resident in Canada should contact their financial advisor to determine whether securities of the Fund may be lawfully sold in their jurisdiction.