The Noranda Income Fund

NORANDA INCOME FUND

(An unincorporated open-ended trust created under the laws of the Province of Ontario)

NOTICE OF ANNUAL GENERAL MEETING OF UNITHOLDERS

NOTICE IS HEREBY GIVEN that the annual general meeting (the "Meeting") of the holders of priority units and special fund units (collectively the "Unitholders") of Noranda Income Fund (the "Fund") will be held on Thursday May 16th, 2013 at 2:00 p.m. (Toronto time) at the Toronto Stock Exchange TMX Broadcast Centre, 130 King Street West, Toronto, Ontario in the Gallery Room, for the following purposes:

1. To receive and consider the consolidated financial statements of the Fund for the fiscal year ended December 31st, 2012, together with the report of the auditors thereon (see "Matters to be Acted on at the Meeting – Financial Statements" in the Circular (as defined below));

2. To reappoint the auditors of the Fund for the ensuing year and authorize the trustees of Noranda Operating Trust (the "Operating Trust") to fix the auditors' remuneration (see "Matters to be Acted on at the Meeting – Appointment and Remuneration of Auditors of the Fund" in the Circular);

3. To direct and instruct Canadian Electrolytic Zinc Limited, as administrator of the Fund (the "Administrator") as to the manner in which the Administrator shall vote the Fund's units of the Operating Trust to elect the trustees of the Operating Trust (the "Trustees"), reappoint the auditors of the Operating Trust for the ensuing year and authorize the Trustees to fix the auditors' remuneration (see "Matters to be Acted on at the Meeting – Directions and Instructions to the Sole Trustee" in the Circular); and

4. To transact such further or other business that may properly come before the Meeting or any adjournment or postponement thereof.

The Administrator, on behalf of the Fund, has fixed March 26th, 2013 as the record date for determining those Unitholders entitled to receive notice of and to vote at the Meeting and any adjournment or postponement thereof. The management information circular of the Fund dated April 4th, 2013 (the "Circular") and the accompanying form of proxy or voting instruction form provide additional information relating to the matters to be dealt with at the Meeting and form part of this Notice of Meeting. You are encouraged to access and review all important information contained in the Circular before voting. The Circular and the Fund's annual report in respect of fiscal 2012, which includes the Fund's management's discussion and analysis and the annual audited consolidated financial statements for the fiscal year ended December 31st, 2012 (collectively, the "Meeting Materials") are available on the Fund’s website at http://www.norandaincomefund.com/investor/agm_materials.html or under the Fund’s SEDAR profile at www.sedar.com. If you would like to obtain paper copies of the Meeting Materials, you must call our toll-free number at 1-877-907-7643. To facilitate timely delivery, all requests for paper copies of the Meeting Materials must be received by May 6th, 2013.

If you are unable to attend the Meeting in person, please complete, sign and return the enclosed form of proxy or voting instruction form, as applicable, to the Fund, c/o its registrar and transfer agent, Computershare Trust Company of Canada, in the envelope provided for that purpose, or deliver it by hand to the Fund, c/o Computershare Trust Company of Canada at 100 University Avenue, 9th floor, Toronto, Ontario, M5J 2Y1. In all cases, Unitholders should carefully follow the instructions set out in the form of proxy or voting instruction form, as applicable, accompanying this Notice of Meeting in order to have your priority units and special fund units voted at the Meeting. In order to be effective, proxies must be received not later than 4:00 p.m. (Toronto time) on Tuesday May 14th, 2013, or, if the Meeting is adjourned or postponed, not later than 48 hours, excluding Saturdays, Sundays and holidays, preceding the time of any adjournment or postponement thereof. Late proxies may be accepted or rejected by the Chairperson of the Meeting in his discretion, however, the Chair is under no obligation to accept or reject any particular late proxy. DATED at Salaberry-de-Valleyfield, Québec, this 4th day of April 2013. By order of Canadian Electrolytic Zinc Limited, the Administrator of the Fund

Ginette Berthel Corporate Secretary

36445-2001 14896234.3

NORANDA INCOME FUND

MANAGEMENT INFORMATION CIRCULAR

SOLICITATION OF PROXIES

This management information circular, including the appendices hereto (the "Circular"), is furnished in connection with the solicitation of proxies by or on behalf of Canadian Electrolytic Zinc Limited, the administrator (the "Administrator") of Noranda Income Fund (the "Fund") for use at the annual general meeting (the "Meeting") of holders of priority units ("Priority Units") and special fund units ("Special Fund Units" and, together with the Priority Units, the "Units") of the Fund to be held on Thursday, May 16th, 2013 at 2:00 p.m. (Toronto time), at the Toronto Stock Exchange TMX Broadcast Centre, 130 King Street West, Toronto, Ontario in the Gallery Room, or any adjournment or postponement thereof, for the purposes set forth in the notice of Meeting (the "Notice"). Management solicitation will be made primarily by mail but proxies may also be solicited personally, in writing, by Internet, facsimile or other electronic form of communication or by telephone by regular employees, officers, trustees, directors, members or agents of the Administrator, the Fund, Noranda Operating Trust (the "Operating Trust") or Computershare Trust Company of Canada, the sole trustee (the "Sole Trustee") of the Fund, at a nominal cost. The costs of solicitation will be borne by the Fund.

The Administrator, on behalf of the Fund, has fixed March 26th, 2013 as the record date (the "Record Date") for determining those holders of Units (the "Unitholders") entitled to receive notice of and to vote at the Meeting or any adjournment or postponement thereof.

The information contained in this Circular is given as at April 4th, 2013 and all currency references are to Canadian dollars, unless otherwise indicated.

APPOINTMENT OF PROXIES

The persons named in the form of proxy or voting instruction form are the trustees of the Operating Trust. Each Unitholder has the right to appoint a person other than any person named in the form of proxy, who need not be a Unitholder, to represent the Unitholder at the Meeting. This right may be exercised by inserting the name of the person to be appointed by the Unitholder in the space provided in the form of proxy and striking out the names of management's nominees or by completing another valid form of proxy. For further details, see the section entitled "Voting of Units" below.

To be effective, proxies must be deposited with the Fund, c/o its registrar and transfer agent, Computershare Trust Company of Canada, at 100 University Avenue, 9th floor, Toronto, Ontario, M5J 2Y1 so as to arrive not later than 4:00 p.m. (Toronto time) on Tuesday May 14th, 2013 or, if the Meeting is adjourned or postponed, not later than 48 hours, excluding Saturdays, Sundays and holidays, preceding the time when such adjourned or postponed meeting is reconvened. Late proxies may be accepted or rejected by the Chair of the Meeting in his discretion, however, the Chair is under no obligation to accept or reject any particular late proxy.

REVOCATION OF PROXIES

A Unitholder who has given a proxy may revoke the proxy at any time by an instrument in writing, including another valid form of proxy, duly executed by the Unitholder or by his or her attorney duly authorized in writing, deposited with the Fund as provided above. A Unitholder may also revoke a proxy in any other manner permitted by law, but prior to the exercise of such proxy in respect of any particular matter.

VOTING OF UNITS

1. VOTING OF UNITS – GENERAL PROVISIONS

On any ballot that may be called for, the persons designated in the form of proxy or voting instruction form will vote "FOR" or "AGAINST" or "WITHHOLD" from voting the Units of the Fund in respect of which they are appointed by proxy in accordance with instructions of the Unitholder indicated on the proxy or the instruction form. In the absence of instructions with respect to a particular matter, the Units will be voted "FOR" the resolution as indicated under the appropriate heading in this Circular. For further details, see the section entitled "Matters to be Acted on at the Meeting" below.

The form of proxy confers discretionary authority with respect to amendments or variations to the matters identified in the Notice and other matters which may properly come before the Meeting. As at the date of this Circular, the Administrator is not aware of any amendments, variations or other matters to come before the Meeting, except those which are indicated in the Notice.

2. VOTING BY NON-REGISTERED UNITHOLDERS

The only registered holder of Priority Units of the Fund is CDS & Co. which is the nominee of CDS Clearing and Depository Services Inc. ("CDS"), an entity which acts as a clearing agent for intermediaries (each an "Intermediary") such as, among others, banks, trust companies, securities dealers or brokers and trustees or administrators of self-administered registered retirement savings plans, registered retirement income funds, registered education savings plans and similar plans. In accordance with the requirements of National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer, the Fund has distributed the Notice and the form of proxy to CDS and the Intermediaries for onward distribution to non-registered holders ("Non-Registered Holders") and has made available on the Internet, this Circular and the Fund's annual report in respect of fiscal 2012 (the "Annual Report") (which includes the Fund's management's discussion and analysis (the "MD&A") and the annual audited consolidated financial statements for the fiscal year ended December 31st, 2012 (the "Consolidated Financial Statements")) (collectively, the "Meeting Materials"). Units held by CDS for any Intermediary can only be voted upon the instructions of the Non- Registered Holder of Units on whose behalf such Units are held. Without specific instructions, Intermediaries are prohibited from voting Units on behalf of their clients. Non-Registered Holders who have not objected to their Intermediary disclosing certain information about them to the Fund are referred to as "NOBOs", whereas Non-Registered Holders who have objected to their Intermediary disclosing ownership information about them to the Fund are referred to as "OBOs". The Fund has chosen not to distribute the Meeting Materials to NOBOs. The Fund will assume the cost of delivery of the Meeting Materials by the Intermediaries to the OBOs.

The Intermediary holding the Units on your behalf is required to forward the Notice and the form of proxy to you, unless you have waived your right to receive them, and to seek your instructions as to how to vote your Units in respect of each of the matters described in this Circular to be voted on at the Meeting. Very often, Intermediaries will use service companies to forward the Meeting Materials to Non-Registered Holders. The majority of brokers and nominees now delegate responsibility for obtaining instructions from clients to Broadridge Investor Communications Solutions, Canada, and its counterpart in the United States ("Broadridge"). Broadridge typically applies a special sticker to the proxy forms or voting instruction forms, mails those forms to the Non-Registered Holders and asks Non-Registered Holders to return the forms to Broadridge in accordance with the instructions therein. Broadridge then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of Units to be represented at the Meeting.

Generally, Non-Registered Holders who have not waived the right to receive Meeting Materials will be given either:

(a) Voting Instruction Form – A voting instruction form, which must be completed and signed by the Non-Registered Holder in accordance with the directions on the voting instruction form and returned to the Intermediary or its service company. In some cases, the completion of the voting instruction form by telephone, the Internet or facsimile is permitted; or

(b) Form of Proxy – A form of proxy that has already been signed by the Intermediary (typically by a facsimile, stamped signature), which is restricted as to the number of Units beneficially owned by the Non-Registered Holder but which is otherwise not completed. The Non-Registered Holder need not sign this form of proxy. In this case, the Non-Registered Holder who wishes to submit a proxy should otherwise properly complete the form of proxy and deliver it to the Fund or its transfer agent as set out in the Notice of the Meeting.

The purpose of these procedures is to permit Non-Registered Holders to direct the voting of the Units that they beneficially own. Should a Non-Registered Holder who receives either a form of proxy or a voting instruction form wish to vote at the Meeting in person (or have another person attend and vote on behalf of the Non-Registered Holder), the Non-Registered Holder should strike out the names of the persons designated in the form of proxy and insert the Non-Registered Holder's (or such other person's) name in the blank space provided or, in the case of a voting instruction form, follow the corresponding directions on the form. A Non-Registered Holder receiving a proxy or voting instruction form with a Broadridge sticker on it cannot use that proxy to vote Units directly at the Meeting. The proxy must be returned to Broadridge well in advance of the Meeting in order to have the Units voted. Non-Registered Holders who wish to vote your Units in person at the Meeting should contact your Intermediary and follow their instructions for completion and return of the form of proxy or voting instruction form provided to you directly by them or Broadridge.

In either case, Non-Registered Holders should carefully follow the instructions of their Intermediary or Broadridge, including those regarding when and where the proxy or voting instruction form is to be delivered in order to have your Units voted at the Meeting.

OUTSTANDING UNITS

Only holders of Priority Units and Special Fund Units as at the close of business on March 26th, 2013 (the Record Date for the Meeting) will be entitled to notice of and to vote at the Meeting, either in person or by proxy, or any adjournment or postponement thereof. Holders of Priority Units and Special Fund Units will vote as one class on all matters and will be entitled to one vote for each Priority Unit or Special Fund Unit held in accordance with the terms of the amended and restated trust indenture of the Fund dated April 18th, 2002 and amended and restated as of December 12th, 2011 (the "Fund Indenture"). As at April 4th, 2013, there were 37,497,975 Priority Units and 12,500,000 Special Fund Units outstanding. The Fund in turn owns all of the outstanding trust units (the "Trust Units") of the Operating Trust and is required to vote those Trust Units in accordance with the instructions of the Unitholders received at the Meeting.

The Fund's sole operating asset is its interest in the electrolytic zinc plant and processing facility (together with associated roasters, acid plants, remediation facilities, settling ponds, wastewater treatment plants and related assets and equipment) located in Salaberry-de-Valleyfield, Québec (the "Processing Facility"), which it indirectly owns through Noranda Income Limited Partnership ("NILP"). Ordinary units (the "Ordinary Units") of NILP, all of which are currently held by a subsidiary of Xstrata Canada Corporation ("Xstrata Canada"), are exchangeable for Priority Units on a one-for-one basis upon the occurrence of certain events. The Special Fund Units provide voting rights in respect of the Fund to the holder of the Ordinary Units. In the event of a take-over bid for the Priority Units: (a) the Ordinary Units associated with the Special Fund Units may be permitted to be exchanged for Priority Units so that they may be deposited under the bid; or (b) the Fund may be obligated to ensure that the Ordinary Units are able to participate in the bid to the same extent and on an economically equivalent basis as the Priority Units. The Ordinary Units are also exchangeable for Priority Units upon the occurrence of various other events. In the event that an Ordinary Unit relating to a Special Fund Unit is no longer outstanding, the applicable Special Fund Unit shall automatically be redeemed by the Fund and cancelled. Further details are contained in the Fund's annual information form dated March 26, 2013 for the fiscal year ended December 31st, 2012 (the "2012 Annual Information Form") under the section entitled "General Description of Capital Structure", a copy of which is available on SEDAR at www.sedar.com.

PRINCIPAL HOLDERS

The only registered holder of Priority Units is CDS. The only registered holder of Special Fund Units is a subsidiary of Xstrata Canada. To the best of the knowledge of the directors and officers of the Administrator, only the following person beneficially owns, directly or indirectly, or exercises control or direction over Priority Units or Special Fund Units carrying more than 10% of the votes attached to any class of outstanding voting securities of the Fund entitled to vote at the Meeting.

Approximate Number of Units Approximate % Unitholder Beneficially Owned or over Which of Outstanding Voting Units Control of Direction is Exercised

100% of Special Fund Units and Xstrata Canada(1) Special Fund Units: 12,500,000 25.001% of all Units

______Notes:

(1) The Special Fund Units are held by N-NIF Holdings Limited Partnership, an indirect wholly-owned subsidiary of Xstrata Canada.

MATTERS TO BE ACTED ON AT THE MEETING

3. FINANCIAL STATEMENTS

The annual audited consolidated financial statements of the Fund for the fiscal year ended December 31st, 2012 will be provided to the Unitholders at the Meeting for their consideration, together with the report of the auditors thereon.

4. REAPPOINTMENT AND REMUNERATION OF THE AUDITORS OF THE FUND

The Administrator proposes to reappoint Ernst & Young LLP, Chartered Accountants, as the auditors of the Fund to hold office until the close of the next annual meeting of Unitholders and proposes that the Unitholders authorize the trustees of the Operating Trust (the "Trustees") to fix the remuneration of the auditors. The persons named in the form of proxy/voting instruction form intend to vote "FOR" the ordinary resolution reappointing Ernst & Young LLP, Chartered Accountants, as the auditors of the Fund to hold office until the next annual meeting of Unitholders or until their successors are appointed, and authorizing the Trustees to fix the remuneration of the auditors, unless the Unitholder who has given the proxy has directed that the Units represented thereby be withheld from voting in respect thereof. Ernst & Young LLP have been acting as auditors of the Fund since its inception in 2002. A simple majority of the votes cast at the Meeting must be voted "FOR" the ordinary resolution in order for Ernst & Young LLP to be reappointed and for the Trustees to have the authority to fix their remuneration. For fiscal 2012, the fees charged by Ernst & Young LLP to the Fund were $492,005 compared with $555,312 in fiscal 2011.

Fiscal Year ended Fiscal Year ended December 31st, 2012 December 31st, 2011

Audit Fees $309,500 $291,000 Audit-Related Fees - $150,325 Tax Fees $96,915 $22,500 Other Fees $85,590 $91,487 Total $492,005 $555,312

Fees for audit services include fees associated with the annual audit, quarterly reviews and fees associated with regulatory filings. Audit- related services are for assurance and related services provided by Ernst & Young LLP that are reasonably related to its role as auditor and not reported under "Audit Fees" above, and included fees related to International Financial Reporting Standards audit work. Tax fees include tax compliance services, tax advice and tax planning provided to the Fund and its subsidiaries. All other fees are primarily related to translation services.

5. DIRECTIONS AND INSTRUCTIONS TO THE SOLE TRUSTEE

The Fund is the sole unitholder of the Operating Trust. Under the trust indenture of the Operating Trust dated April 18th, 2002 (the "Trust Indenture"), the Fund must, by way of an ordinary resolution passed by the holders of not less than 50% plus one of the votes cast by Unitholders present in person or by proxy at this Meeting (assuming a quorum is present), direct and instruct the Administrator, to whom the Sole Trustee has delegated its powers and authority, as to the manner in which the Administrator shall vote the Trust Units to elect the Trustees, reappoint the auditors of the Operating Trust for the ensuing year and authorize the Trustees to fix the remuneration of the auditors of the Operating Trust.

(a) Reappointment of Auditors of the Operating Trust

The Fund proposes to reappoint Ernst & Young LLP, Chartered Accountants, as the auditors of the Operating Trust, to hold office until the close of the next annual meeting of unitholders of the Operating Trust and proposes that the Unitholders authorize the Trustees to fix the remuneration of the auditors. The persons named in the form of proxy/voting instruction form intend to vote "FOR" the ordinary resolution directing and instructing the Administrator as to the manner in which the Administrator shall vote the Trust Units to reappoint Ernst & Young LLP, Chartered Accountants, as the auditors of the Operating Trust to hold office until the next annual meeting of unitholders of the Operating Trust or until their successors are appointed and authorizing the Trustees to fix the remuneration of the auditors, unless the Unitholder who has given the proxy has directed that the Units represented thereby be withheld from voting in respect thereof. Ernst & Young LLP have been acting as the auditors of the Operating Trust since its inception. A simple majority of the votes cast at the Meeting must be voted "FOR" the ordinary resolution in order for Ernst & Young LLP to be reappointed as the auditors of the Operating Trust and for the Trustees to have the authority to fix their remuneration. Details of the fees paid to Ernst & Young LLP during fiscal 2012 and fiscal 2011 are set out under the section entitled "Reappointment and Remuneration of Auditors of the Fund" above.

(b) Election of Operating Trust Trustees

The Operating Trust currently has seven Trustees, each of whom will hold office until the next Operating Trust annual meeting or until his successor is duly elected or appointed in accordance with the Trust Indenture, as amended from time to time. The persons named in the form of proxy/voting instruction form intend to vote "FOR" each of the proposed nominees whose names are set out below as Trustees of the Board of Trustees of the Operating Trust (the "Board"), unless the Unitholder who has given such proxy has directed that the Units represented thereby be withheld from voting for any or all of such nominees. The Administrator does not anticipate that the proposed nominees will be unable to serve as Trustees but, if that should occur for any reason prior to the Meeting, the persons named in the form of proxy/voting instruction form reserve the right to vote for another nominee in their discretion. Each of the seven Trustees to be elected at the Operating Trust's annual meeting will, if elected, hold office until the next annual meeting or until his successor is duly elected or appointed in accordance with the Trust Indenture, as amended from time to time. A simple majority of the votes cast at the Meeting must be voted "FOR" each of the nominees in order for the Trustees to be reappointed to the Board.

The Board has adopted a policy whereby any nominee for election as a Trustee at the Meeting for whom more votes are withheld than are cast in favour of him or her will be considered by the Board not to have received the support of the Unitholders. Such a nominee will be expected to forthwith submit his or her resignation to the Board for consideration. A Trustee who has tendered a resignation pursuant to this policy will not participate in any deliberations of the Board with respect to his or her resignation.

The Board will promptly accept the resignation unless the Board determines that there are extraordinary circumstances relating to the composition of the Board or the voting results that should delay the acceptance of the resignation or justify rejecting it. In any event, it is expected that the resignation will be accepted (or in rare cases rejected) within 90 days of the meeting and the Board will issue a press release either announcing the resignation of the Trustee or explaining why it has not been accepted. This policy does not apply in circumstances involving contested Trustee elections.

The following table sets forth certain information with respect to the seven persons proposed for nomination as Trustees, including the number of Units of the Fund beneficially owned or over which control or direction was exercised as at the date of this Circular.

Current Trustee Units Owned, Principal Public Board Memberships during controlled or Occupation the last 5 years directed Manuel Álvarez Dávila ― Executive General Manager ― Madrid, Spain Corporate for Xstrata Age: 49 Zinc Trustee since May 4th, 2009

Manuel Álvarez Dávila has dual expertise in the global zinc industry and in finance. He is General Manager Corporate of Xstrata Zinc. He previously held the position of Chief Operating Officer, Xstrata Zinc Canada (zinc and lead producer and commodity business of Xstrata plc). He joined Xstrata in 1998 and has held several positions, including Assistant to the Chairman, Chief Financial Officer and General Manager of Asturiana de Zinc. He subsequently became Chief Operating Officer of Xstrata Zinc Europe and General Manager Corporate of Xstrata Zinc, leading worldwide Xstrata Zinc Commercial Operations, Sustainability Development activities, Risk Management and other corporate responsibilities. He held the position of Chief Executive Officer of Canadian Electrolytic Zinc Limited from February 1st, 2012 until June 30th, 2012. Prior to 1998, Mr. Álvarez Dávila held numerous senior positions with Daimler-Benz in Spain; he then went on to become the Managing Director of Daimler-Benz Financial Services in Portugal. He was also the Managing Director and a member of the Board of a joint venture between Banco Santander and Fiat-Iveco in Spain and Portugal. Mr. Álvarez Dávila launched the business of the joint venture which generated significant financial results from the first year. He holds degrees in Law and Business Administration from the Universidad Pontificia de Comillas in Madrid.

Current Trustee Units Owned, Principal Public Board Memberships during controlled or Occupation the last 5 years directed

Jean Pierre (J.P.) Ouellet ― Venture Partner and Advisor, St. Richmont Mines Inc. Montréal, Québec, Canada Lawrence Capital GBO Inc. Age: 65 La Mancha Resources Inc. Trustee since October 7th, 2010

Jean Pierre (J.P.) Ouellet is the Chair of the Board's Governance and Human Resources Committee and also serves as a member of the Audit Committee and the Independent Committee. Mr. Ouellet has dual expertise in law and finance and worked as a corporate and commercial lawyer at one of Canada's leading law firms for over 20 years, where he specialized in capital markets transactions and mergers and acquisitions. From 2000 to 2008, Mr. Ouellet served as a senior ranking executive with RBC Capital Markets, with overall responsibility for its activities in Québec. Previously, he was Senior Vice-President, Chief Legal Officer and Corporate Secretary of Canadian National Railways Inc. Mr. Ouellet was a member of the Board of La Mancha Resources Inc. from April 2012 to November 2012 and a member of the Board of Richmont Mines Inc. from February 2010 to February 2012. He is currently a venture partner, investor and advisor to St. Lawrence Capital, a venture capital fund based in Montréal. Mr. Ouellet currently serves on several corporate and non-profit boards of directors including Home Equity Bank and the Macdonald Stewart Foundation. He is also a member of the Advisory Board of Birch Hill Equity Partners. Mr. Ouellet graduated from Oxford University with a Bachelor of Civil Law (Rhodes Scholar) and is a member of the Québec Bar.

Current Trustee Units Owned, Principal Public Board Memberships during controlled or Occupation the last 5 years directed

François R. Roy ― Corporate Director Capstone Infrastructure Corporation Montréal, Québec, Canada Transcontinental Inc. Age: 57 th La Mancha Resources Inc. Trustee since October 7 , Pixman Nomadic Media Inc. 2010

François R. Roy serves as a member of the Board's Audit Committee, Governance and Human Resources Committee and is the Vice-Chair of the Independent Committee. Mr. Roy has in-depth experience as a senior financial executive and has extensive experience as a corporate director and executive in the private and public sectors, at not-for-profit organizations and in academia. He was previously Chief Financial Officer at Télémédia Corporation, as well as Avenor Inc. and Québecor Inc. Mr. Roy began his career at The Bank of Nova Scotia, where he held several positions in Canada and the United States, and then worked for Société générale de financement du Québec. He was also Vice Principal (Administration and Finance) at McGill University from 2007 to 2010 and, in that capacity, was McGill's Chief Financial Officer and Chief Administration Officer. He has been a corporate director since 1998 and sits on the boards of Capstone Infrastructure Corporation and Transcontinental Inc. Mr. Roy holds a Bachelor of Arts and a Master of Business Administration from the University of Toronto. Over the past 25 years, he has been active with many not-for-profit organizations, including the Montréal Museum of Fine Arts, the Canadian Centre for Architecture, Vie des Arts magazine, the Opéra de Montréal and Collège Jean-Eudes. He is currently a member of the Board of Trustees of Canada's National Arts Centre Foundation and the Arts Council of Montréal.

Current Trustee Units Owned, Principal Public Board Memberships during controlled or Occupation the last 5 years directed John J. Swidler ― Senior Advisor, Richter LLP Dollarama Inc. Montréal, Québec, Canada Reitmans (Canada) Limited Age: 69 Trustee since October 7th, 2010

John J. Swidler, Chartered Professional Accountant (FCPA, CA) and Fellow Chartered Accountant (FCA), is the Chair of the Board of the Operating Trust and of the Independent Committee and also serves as a member of the Audit Committee and the Governance and Human Resources Committee. Mr. Swidler specializes in corporate finance at Richter LLP, where he is a Senior Advisor. Mr. Swidler has been appointed to act on behalf of financial institutions and private equity funds, and has also been involved in a number of significant mergers and acquisitions transactions. He was also the Managing Partner of RSM Richter LLP from 1996 to January 1st, 2007 (now Richter LLP) and was Chairman of the firm's executive committee from 1982 to 1996. Mr. Swidler has been a director of Reitmans (Canada) Limited since April 2nd, 2008, where he is currently chair of the Audit Committee as well as Lead Director. He also serves on the board of directors of Dollarama Inc., where he is Chair of the Audit Committee. Mr. Swidler graduated from McGill University with a Bachelor of Commerce degree and has obtained designation as a Chartered Accountant. He also received a Bachelor of Civil Law degree from McGill University. He received his Fellow Chartered Accountant (FCA) designation from the Ordre des comptables agréés du Québec in 1992.

Current Trustee Units Owned, Principal Public Board Memberships during controlled or Occupation the last 5 years directed Barry Tissenbaum ― Corporate Director and Medworxx Solutions Inc. Toronto, Ontario, Canada Business Consultant Corel Corporation Age: 67 Universal Energy Group Ltd. Trustee since October 7th, Northstar Healthcare Inc. 2010

Barry Tissenbaum, Chartered Professional Accountant (CPA, CA), is Chair of the Audit Committee of the Operating Trust and also serves as a member of the Board's Governance and Human Resources Committee and the Independent Committee. Mr. Tissenbaum is a Corporate Director as well as a consultant for B.A.T. Consulting, which provides advisory services to numerous companies. He is an accomplished advisor to senior management and has earned a reputation for taking an entrepreneurial approach to business. Mr. Tissenbaum is a former senior partner with Ernst & Young LLP, where he headed their Retail & Consumer Products division and worked for many years in the Entrepreneurial Services Group and served as the Toronto Mid-Town Managing Partner. Mr. Tissenbaum is a director on the board of Corel Corporation; a board member and the Audit Committee chair of Medworxx Solutions Inc.; a member of the Independent Review Committee of Faircourt Asset Management; an advisory board member of numerous private companies; a former director and Audit Committee chair of Universal Energy Group Ltd.; and a former director and Audit Committee member of Northstar Healthcare Inc. Mr. Tissenbaum obtained his Chartered Accountant designation in Québec in 1968 and in Ontario in 1974. He is a member of the Canadian Institute of Chartered Accountants and the Institute of Chartered Accountants of Ontario.

Current Trustee Units Owned, Principal Public Board Memberships during controlled or Occupation the last 5 years directed Neil Wardle - Chief Operating Officer for Xstrata - Oakville, Ontario, Canada Zinc Canada Age: 48 Trustee since February 12th, 2013

Neil Wardle is a seasoned mining executive with a diverse background. He joined Xstrata Zinc Canada as Chief Operating Officer in July 2012. In this role, Neil has responsibility for over 2,000 Xstrata Zinc Canada employees working at mine sites, metal processing facilities and exploration projects in Canada and Ireland as well as for the NorFalco sulphuric acid business based in Cleveland, Ohio. Prior to this, Mr. Wardle was the Executive General Manager of Britannia Refined Metals Limited where he oversaw the lead/silver refinery in Northfleet, United Kingdom. He has also held various other mining and metallurgical roles in Australia, including Manager at Mount Isa Copper Smelter and the Mill Superintendent at Normandy Mines. In addition to his business and mining experience, Mr. Wardle has also significant policy experience serving as Chairman for the International Lead Association since 2008 where he is leading efforts on Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) legislation in Europe. Mr. Wardle holds a Bachelor of Applied Sciences in Metallurgy from the South Australian Institute of Technology.

Current Trustee Units Owned, Principal Public Board Memberships during controlled or Occupation the last 5 years directed John Whyte ― Vice-President ― Toronto, Ontario, Canada Legal, Xstrata Age 51 Zinc Canada Trustee since: February 19th, 2007

John Whyte has in-depth expertise in commercial and anti-trust law, as well as corporate law and mergers and acquisitions, especially as they relate to the mining industry. He currently holds the position of Vice-President, Legal of Xstrata Zinc Canada. Mr. Whyte joined Noranda Inc. in 1991 after being in private practice for several years with Beard, Winter, a Toronto law firm that focused on corporate commercial practice. He subsequently held a variety of senior positions within the legal department and the recycling business of Noranda Inc. Over the years, he has worked on the proposed merger of Falconbridge Limited and Inco; and he lead the legal team to form the Noranda DuPont LLC joint venture that marketed the sulphuric acid from the former Falconbridge and Noranda operations. Other transactions that Mr. Whyte has worked on include the sale of the Halfmile/Stratmat properties to Kria Resources Inc., a bridge financing for JM Asbestos, the French Government approval for the Koniambo project in New Caledonia, the formation of the Kabanga joint venture in Tanzania, the Collahuasi acquisition in Chile and the Antamina acquisition in Peru. He is a member of the Law Society of Upper Canada, the Canadian Bar Association of Ontario and the Board of Regents of Victoria College (University of Toronto), where he is a member of the Governance and Nominating Committee. Mr. Whyte is also a member of the Prospectors and Developers Association of Canada, the Rocky Mountain Mineral Law Foundation and the Canadian Institute of Metallurgy. Mr. Whyte holds a B.A. (Hons.) from the University of Toronto (Victoria College), and an LL.B from Queen's University.

The current Trustees have been engaged in their principal occupations for at least five years, except (i) Neil Wardle has held the position of Chief Operating Officer of Xstrata Zinc Canada since July 3rd, 2012. Prior to this, he was the Executive General Manager of Britannia Refined Metals Limited where he oversaw the lead/silver refinery in Northfleet, United Kingdom ; (ii) Manuel Álvarez Dávila has been part of senior management of Xstrata Zinc since 1998, was Chief Operating Officer of Xstrata Zinc for the European Operation until his appointment as Chief Operating Officer for Xstrata Zinc Canada on January 15th, 2009; he was Chief Executive Officer of Canadian Electrolytic Zinc Limited from February 1st, 2012 to June 30, 2012 and is currently the Executive General Manager Corporate for Xstrata Zinc; (iii) John J. Swidler currently acts as a senior advisor to Richter LLP (independent accounting, business advisory and consulting firm); prior to that he was a partner of Richter LLP from 1973 until 2008; (iv) Jean Pierre Ouellet currently acts as a venture partner with St. Lawrence Capital (venture capital fund); from April 2012 to November 2012 he was a member of the board of La Mancha Resources Inc.; from February 2010 to February 2012, he was a member of Richmont Mines Inc.; and prior to that he held the position of Vice Chairman (Québec), RBC Capital Markets (investment banking and financial services) from 2000 to 2008; and (v) François R. Roy currently acts as a corporate director; prior to that he held the position of Vice Principal (Administration and Finance) for McGill University from 2007 to June 2010.

Cease Trade Orders, Bankruptcies, Penalties and Sanctions

Except as set out below, none of the current Trustees:

(a) is, as of the date of this Circular, or has been, within 10 years before the date of this Circular, a trustee or director, chief executive officer or chief financial officer of any company (including the Fund and the Operating Trust) that,

(i) was subject to an "order" that was issued while the person was acting in the capacity of trustee or director, chief executive officer or chief financial officer; or

(ii) was subject to an order that was issued after the person ceased to be a trustee or director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as a trustee or director, chief executive officer or chief financial officer; or

(b) is, as of the date of this Circular, or has been within 10 years before the date of this Circular, a trustee or director, or executive officer of any company (including the Fund and the Operating Trust) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or

(c) has, within 10 years before the date of this Circular, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the person.

Mr. Ouellet ceased to be a director of GBO Inc. ("GBO") on September 7th, 2011. While serving as a director of GBO, on June 11, 2004, Management of GBO filed a notice of intention to make a proposal under the Bankruptcy and Insolvency Act (Canada). The proposal was filed on June 25th, 2004, accepted by the creditors on July 14th, 2004 and ratified by the Superior Court of Québec on August 5th, 2004. The terms of the proposal were fully satisfied as at June 30th, 2005. On August 28th, 2007, the Superior Court of Québec ordered that the trustee be discharged and that the security granted in relation to GBO property be released. Subsequent to Mr. Ouellet's resignation from the board of GBO on September 9th, 2011, GBO announced that it had filed a notice of intention to make a proposal pursuant to the Bankruptcy and Insolvency Act (Canada) and, on October 14th, 2011, it further announced that since it had failed to file a proposal within the prescribed time of filing its notice of intention, GBO was deemed to have made an assignment in bankruptcy. In addition, on October 14th, 2011, GBO announced that since it no longer met the TSX venture exchange continued listing requirements, trading in the securities of GBO had been suspended (which order continues in effect) and GBO had been reclassified from a tier 1 to a tier 2 issuer.

Mr. Roy ceased to be a director of Pixman Nomadic Media Inc. ("Pixman") on November 27th, 2009. Between November 5th, 2009 and February 17th, 2010, the Alberta Securities Commission, the British Columbia Securities Commission, the Ontario Securities Commission and the Autorité des marchés financiers issued cease trade orders in respect of Pixman in connection with its failure to file annual audited financial statements for the year ended June 30, 2009 and unaudited interim financial statements for the period ended September 30th, 2009, as well as related continuous disclosure documents. On February 2nd, 2010, Pixman filed a notice of intention to make a proposal to creditors under the Bankruptcy and Insolvency Act (Canada). Mr. Roy ceased to be a director of Komunik Corporation ("Komunik") on April 1st, 2008. Komunik filed for protection under the Companies' Creditors Arrangement Act (Canada) in the fall of 2008.

For the purposes herein, "order" means a cease trade order, an order similar to a cease trade order, or an order that denied the relevant company access to any exemption under securities legislation that was in effect for a period of more than 30 consecutive days. In addition, no personal holding company of any current Trustee is or has been, as applicable, subject to the foregoing during the applicable time periods.

Arrangements with Nominee Trustees

Pursuant to the Fund Indenture, as long as Xstrata Canada owns at least 10% of the outstanding Priority Units of the Fund (assuming the exchange of Ordinary Units), Xstrata Canada is entitled to propose in the proxy-related materials sent to Unitholders the nominees for election of the Trustees. If Xstrata Canada owns less than the majority of the outstanding Priority Units (assuming the exchange of Ordinary Units), which currently is the case, then at least four of the seven Trustees proposed by Xstrata Canada must be "independent" to Xstrata Canada. If Xstrata Canada owns more than 50% of the Priority Units (assuming the exchange of Ordinary Units), then four of the seven proposed trustees may be "related" to Xstrata Canada and the remaining three proposed Trustees would be required to be "independent" to Xstrata Canada. There is no requirement that the holders of Priority Units and Special Fund Units vote in favour of the nominees proposed by Xstrata Canada. For additional details, reference is made to the Fund Indenture, a copy of which is available on SEDAR at www.sedar.com. Except as set forth above, there are no contracts, arrangements or understandings between any trustee or executive officer or any other person pursuant to which any of the current Trustees have been nominated.

CURRENT TRUSTEES' RELATIONSHIPS WITH NORANDA INCOME FUND

The following chart sets out the relationship between the current Trustees and the Fund. As discussed further under "Management of the Fund" below, the Administrator is a wholly-owned subsidiary of Xstrata Canada (through its Xstrata Zinc Canada division), which operates and manages the Operating Trust and the Processing Facility and administers the Fund. Xstrata Canada, in turn, through an indirect wholly-owned subsidiary, holds a 25% interest in the Fund through its ownership of Special Fund Units of the Fund and Ordinary Units of NILP. Based on the foregoing, certain of the Trustees listed below have been determined to not be "independent" on the basis of their current or former relationship with Xstrata Canada. Further details are also set out under the section entitled "Corporate Governance Disclosure" below.

Non- Name Independent Reason for Related Status Independent Manuel Álvarez Dávila (1)  Executive General Manager Corporate for Xstrata Zinc Neil Wardle (1)  Chief Operating Officer for Xstrata Zinc Canada John Whyte (1)  Vice-President, Legal for Xstrata Zinc Canada John J. Swidler (2)  Jean Pierre Ouellet (2)  Barry Tissenbaum (2)  François R. Roy (2)  ______

Notes: (1) In the normal course of business, for as long as Xstrata Canada directly or indirectly owns at least 10% of the outstanding Priority Units (assuming the exchange of the Ordinary Units), the majority of the Trustees must be "Independent Trustees" (as defined under the Trust Indenture) and the balance of the remaining proposed Trustees may be persons who are related to Xstrata Canada. See also "Directions and Instructions to the Sole Trustee - Arrangements with Nominee Trustees" above. (2) A majority (57%) of the Board of Trustees is composed of Independent Trustees. MEETINGS HELD AND ATTENDANCE OF TRUSTEES The table below sets out information in respect of the Board of Trustees and Committee meetings held and attendance from January 1, 2012, either in person, by phone or by other electronic communication until December 31st, 2012.

BOARD AND COMMITTEE ATTENDANCE FROM JANUARY 1st, 2012 TO DECEMBER 31st, 2012

Governance

Board of Audit and Human Trustee Independent Trustees Committee Resources Committee (2) Committee (1) 10 of 10 29 of 29 John Swidler 100% 4 of 4 100% 4 of 4 100% 100% (Chair) (Chair) Jean Pierre 4 of 4 10 of 10 100% 4 of 4 100% 100% 29 of 29 100% Ouellet (Chair) Barry 4 of 4 10 of 10 100% 100% 4 of 4 100% 29 of 29 100% Tissenbaum (Chair) François R. 29 of 29 10 of 10 100% 4 of 4 100% 4 of 4 100% 100% Roy (Vice-Chair) Manuel Álvarez 9 of 10 90% N/A N/A N/A Dávila Bob Sippel(3) 10 of 10 100% N/A N/A 11/11 100% John Whyte 10 of 10 100% N/A N/A N/A

Notes: (1) The Governance and Human Resources Committee is required to hold a minimum of two meetings per year. (2) For further details on the Independent Committee, see the section entitled "Committees of the Board – The Independent Committee" below.

(3) Mr. Sippel attended all of the independent committee meetings for which he was invited. Mr. Sippel resigned from the Board on February 12th, 2013.

BOARD TENURE

The following chart summarises the Board of Trustees' tenure since the Fund's inception in 2002 as at April 4th, 2013.

STATEMENT OF EXECUTIVE COMPENSATION

The Fund has appointed no officers. The Administrator, a wholly-owned subsidiary of Xstrata Canada (through its Xstrata Zinc Canada division), operates and manages the Operating Trust and administers the Fund. Its officers' compensation is therefore determined by Xstrata Canada, after consultation with the Trustees. For information on the operation and management of the Fund, please see details on the governing contracts under the section "Management of the Fund" below.

The following Compensation Discussion and Analysis represents the compensation payable by the Administrator to its Named Executive Officers ("NEOs") that the Administrator recovers from the Fund pursuant to the operating and management agreement dated May 3rd, 2002 between NILP and the Administrator (the "O&M Agreement"), an administration agreement dated April 18th, 2002 between the Fund and the Administrator (the "Administration Agreement") and a management services agreement dated April 18th, 2002 between the Operating Trust and the Administrator (the "Management Services Agreement"). The disclosure set out below reflects the costs attributed and charged to the Fund by the Administrator for the services provided by the NEOs in respect of the Fund.

In respect of Mr. Boone's compensation received in connection with his serving as Chief Financial Officer (CFO) of the Administrator in respect of the Fund, the amount actually attributed and charged to the Fund by the Administrator (due to Mr. Boone only spending a portion of his time on his duties in respect of the Fund, with the remainder being spent on activities for the Administrator's parent, Xstrata Canada) is determined by the Administrator's human resources group based on an analysis of appropriate compensation levels for similar positions in the mining industry and, in the case of any variable compensation component that may be awarded by and attributed to the Fund, certain corporate performance objectives established from time to time for the Administrator’s employees. For purposes of this analysis, the Administrator's human resources group makes reference in part to internal and external studies (including those set out below) completed to determine industry standards with respect to various positions in the mining industry, including Chief Financial Officer.

1. COMPENSATION DISCUSSION AND ANALYSIS

Through its total compensation program for executives, the Administrator aims to attract, retain and motivate top quality people at the executive level.

As a general philosophy, the Administrator believes that executive compensation should be driven primarily by performance relative to the established plans and strategy of the business. Information on the compensation practices of competitors is considered, but does not drive the philosophy or design of the Administrator's program. The Administrator's focus is on rewarding performance, and not on entitlement or excessive levels of employment security. The Administrator's compensation policies are designed to provide an overall competitive compensation package. The Administrator does not turn to fixed policies to determine the relative emphasis on base salary, variable compensation, pension and other compensation awards and benefits. The emphasis on the particular elements of compensation provided to the NEOs may vary from year to year depending on the relative strength of various factors taken into account by the Administrator. In addition to having reference to annual compensation surveys and reviews of the comparator groups referenced below, the Administrator also considers each NEO's experience, past performance, level of responsibility and importance of the position to the business of the Administrator and the Fund, individual performance and the performance of the Administrator and the Fund relative to the industries in which they operate in setting compensation and determining whether to make any adjustments thereto. As noted above, because the NEOs do not devote their attention exclusively to the affairs of the Fund, their total compensation and the relative emphasis on each element of compensation is not tied exclusively to the performance or business of the Fund or the NEOs' performance of duties and responsibilities solely in relation to the Fund.

Elements of Compensation

The total compensation package for executives comprises the following principal elements:

 base salary;  variable compensation;  pension; and  other compensation including a benefits plan, an executive perquisite program, an employee savings plan (the "ESP") and an executive medical program.

Base Salaries

Base salaries for the Fund's executives are reviewed and, if applicable, adjusted, by the Administrator annually to ensure that they reflect the contribution of each executive and any changes are driven primarily by the achievement of any pre-established objectives and by market competitiveness. The Administrator believes that base salaries should be based on the median level for comparable companies within the relevant industry. Accordingly, the Administrator participates in and reviews (on an annual basis) mining industry compensation surveys and reviews prepared annually by each of Coopers Consulting/PricewaterhouseCoopers LLP1 and the Hay Group2, and takes into account the Canadian data set out in such surveys and reviews in determining: (a) the appropriate level of base salary compensation to be provided to the Chief Executive Officer (CEO); and (b) the appropriate level of total base salary compensation for, and the proportion of total compensation to be allocated to the Fund, with respect to the Chief Financial Officer (CFO) position and duties. When setting base salaries, the Administrator considers the impact on pension contributions and associated costs. While such surveys and reviews are consulted annually, they serve as a guidepost for base salaries only, and do not exclusively drive or act as hard targets for establishing or adjusting the NEOs' compensation. The additional factors, discussed above, are also considered by the Administrator when establishing the NEOs' compensation.

Variable Compensation

The Administrator has established a variable compensation plan (the "VCP") as a means to link business performance with the executive's compensation. The VCP generates cash incentives based on corporate and individual performance. The VCP focuses on the achievement of annual objectives, which are designed to, among other things, align the financial and operational performance of the Fund with the creation of Unitholder value.

The Administrator has not established a long-term variable compensation plan for NEOs based on the long-term objectives of the Fund.

CEO

1 The participating comparator companies included in the most recent Coopers Consulting/PricewaterhouseCoopers LLP compensation survey were: Agnico-Eagle Mines Limited, Agrium Inc., ArcelorMittal Mines Canada, AREVA Resources Canada Inc., Aurizon Mines Ltd., Avanti Mining Services Inc., Barrick Gold Corp., BHP Billiton Canada Inc., Cameco Corporation, Chieftain Metals Inc., Claude Resources Inc., Coalspur Mines Ltd., De Beers Canada Inc., Detour Gold Corporation, Diavik Diamond Mines Inc., Gibraltar Mines Ltd., Goldcorp Inc., Golden Band Resources Inc., Golden Predator Corp., Grande Cache Coal Corporation, Huckleberry Mines Ltd., HudBay Minerals Inc., IAMGOLD Corporation, Iron Ore Company of Canada, KGHM International Ltd., Kirkland Lake Gold Inc., Lake Shore Gold Corp., Ledcor Group of Companies, Minto Explorations Ltd., MMG Minerals and Metals Group, Morton Salt Inc., Mosaic Canada LLC, Namibia Rare Earths Inc., Nevsum Resources Ltd., New Gold Inc., North American Palladium Ltd., Nyrstar Canada (Holdings) Ltd., Osisko Mining Corporation, Potash Corp., Rainy River Resources Ltd., Rubicon Minerals Corporation, San Gold Corporation, Selwyn Resources Ltd., Sherritt Coal, Shore Gold Inc., SNC-Lavalin Group Inc., St. Andrew Goldfields Ltd., Stillwater Mining Company, Tata Steel Minerals Canada, Teck Resources Limited, Thompson Creek Metals Company, Trevali Mining Corporation, Uranium One Inc., Vale Canada, Walter Energy, Inc., Xstrata Canada and Yukon Zinc Corporation.

2 The participating comparator companies included in the most recent Hay Group compensation review were: Alamos Gold Inc., AMEC, ArcelorMittal, Barrick Gold Corporation, BHP Billiton Canada Inc., CAE Inc., Canpotex Limited, Centerra Gold Inc., De Beers Canada Inc., Detour Gold Corporation, Fluor, Goldcorp Inc., HudBay Minerals Inc., Hunter Dickinson Services Inc., K+S Potash Canada, KGHM International Ltd., Kinross Gold Corporation, Lake Shore Gold Corp., Lycopodium Limited, North American Palladium Ltd., Orica Mining Services, Pan American Silver Corp., Potash Corp., Rio Tinto, SEMAFO Inc., Sherritt Coal, Shore Gold Inc., Silver Standard Resources Inc., SNC-Lavalin Group Inc., Stillwater Mining Company, Syncrude Canada Ltd., Teck Resources Limited, The Mosaic Company, Thompson Creek Metals Company, Uranium One Inc., Vale Inco Limited, Washington Division of URS Corporation, Xstrata Canada, Yamana Gold Inc., Yukon Zinc Corporation.

VCP awards targets, expressed as a percentage of salary, have been established for the CEO. There is a 15% VCP award target based on established operating performance targets, which include (a) zinc metal production targets, and (b) cost per tonne targets. The VCP award can range from nil to 200% of the target depending on whether the performance targets are met. The Fund is charged for the portion of the CEO's VCP award that is linked to the CEO's performance objectives above. The balance of the VCP is based on the overall financial results of Xstrata Canada's zinc business, including the results of the Fund, and personal objectives set with the NEOs, which is paid by Xstrata Canada.

CFO

With respect to the position of the Chief Financial Officer in respect of the Fund, the VCP award attributed to the Fund is based on a 12.5% VCP award target based on established operating performance targets, which include (a) zinc metal production targets, and (b) cost per tonne targets3. The VCP award can range from nil to 200% of the target depending on whether the performance targets are met. The amount of the CFO's VCP award attributed to the Fund varies depending on the amount of time devoted by the CFO to duties in respect of the Fund.

As a result of only a portion of the CFO's duties are typically in respect of the Fund, the CFO’s achievement of a VCP award (or a material component of that award) is not driven by financial targets or corporate-level goals of the Fund, but also relates to personal and corporate- level objectives related exclusively to Xstrata Canada's business, which amounts are not for the account of the Fund. For further details, see the "Summary Compensation Table" below.

Pension

To ensure the competitiveness of its overall compensation and to assist in retaining qualified people, the Administrator provides, as part of the compensation program, a pension plan in the form of either a defined benefit plan or a defined contribution plan depending on when the employee started to work for the Administrator. Mr. Chapados participated in the defined benefit plan. Ms. Carissimi and Mr. Boone participate in the defined contribution plan.

CEO

In connection with the defined benefit plan provided to the CEO, the amount of the CEO's defined benefit is determined based on the CEO's annual salary and incentive-based awards (VCP awards) and depends upon an actuarial valuation of the Administrator's current service cost of such defined benefit plan as it relates to the CEO, which includes certain actuarial assumptions, all of which service costs associated with the CEO's defined benefits under the plan are then charged to the Fund. The Administrator is responsible for the funding of the defined benefit plan. The remaining future payment obligations associated with the plan, including accrued obligations, any compensatory and non-compensatory changes and other costs and expenses are for the account of the Administrator. The service costs attributed to the Fund generally consist of the increase in value of the plan's applicable future pension liabilities arising from the employees' ongoing membership in the plan during the applicable year, and vary from year to year based on discount rate, salary and VCP award.

In connection with the defined contribution plan provided to the CEO, the CEO's defined pension contributions under the plan are determined based on a fixed percentage of the total salary and incentive-based awards (VCP) provided to the CEO by the Administrator. Accordingly, the pension amounts for the CEO shown in the "Summary Compensation Table" below represent the defined contribution plan that is attributable to the Fund for the services provided by the CEO in respect of the Fund.

CFO

In connection with the defined contribution plan provided to the CFO, the CFO's defined pension contributions under the plan are determined based on a fixed percentage of the total salary and incentive-based awards (VCP) provided to the CFO by the Administrator, and then, depending on the proportion of total time devoted by the CFO to performing duties and services in respect of the Fund (as opposed to duties and services provided to the Administrator and not relating to the Fund), the proportionate amount of the total defined contribution benefit amount for the CFO is allocated to and for the account of the Fund. Accordingly, the pension amounts for the CFO shown in the "Summary Compensation Table" below represent that portion of such defined contribution plan that is attributable to the Fund for the services provided by the CFO in respect of the Fund. Other than the service costs associated with the plan attributed to the Fund, the remaining future payment obligations associated with the plans, including accrued obligations, any compensatory and non-compensatory changes and other costs and expenses are solely for the account of the Administrator and are not attributed to or passed along to the Fund.

Other Compensation

The other compensation of the total executive compensation program includes a benefits plan, an executive perquisite program, the employee savings plan (“ESP”) and an executive medical program. The benefits plan provided to the executives is the same benefit plan that all staff employees of the Administrator are eligible for. The benefits plan includes length of service and salary level to determine the amount of

3 Cost per tonne does not have any standardized meaning under International Financial Reporting Standards. The Fund calculates the cost included in the costs per tonne calculation from the Fund’s 2012 audited consolidated financial statements by taking the sum of the production costs and selling and administration expenses, deducting those selling and administration expenses that are not incurred at the Processing Facility, substituting the pension contributions that are made into the defined benefit pension plans for the pension expense recorded for those same plans and adjusting for the impact of the change in inventory during the year. The above cost amount is then divided by the tonnes of zinc metal production for the year to arrive at the cost per tonne.

benefits that are provided by the Administrator. Under the compensation program, the executives are eligible for a perquisite payment in addition to their annual salary. The Administrator pays the perquisite payment in lieu of perquisites, such as club memberships. The amount of the executive perquisite payments were determined several years ago by Noranda Inc., as the predecessor to Xstrata Canada, and were based on an assessment of the pre-tax cost associated with certain perquisites otherwise customarily provided to executives. Since that time, the amount of the perquisite payments made to the NEOs have been adjusted from time to time to reflect, among other things, adjustments to the NEO's salary and inflation, and to maintain market competitiveness. Under the ESP, employees can contribute up to 5% of their salary towards the purchase of money market investments, with the Administrator contributing cash to the extent of 30% of eligible contributions toward the purchase of additional money market investments. The ESP is available to all employees of the Administrator and is provided to encourage employees to save money for retirement or for other personal finance objectives. The executive medical program provides the executive with the opportunity to consult annually with a medical doctor for a health check-up. These additional compensation awards and benefits were also determined a number of years ago and have remained largely unchanged as the Administrator considers them to be consistent with industry standards and an important tool to aid in the attraction and retention of highly qualified people, as part of an overall competitive compensation package.

Risks Associated with the Administrator’s Compensation Policies and Practices

The Administrator has reviewed its compensation policies and practices to consider whether such policies and practices might encourage inappropriate or excessive risk-taking. The policies and practices for the NEOs do not differ significantly for any particular NEO; nor do they vary from the Administrator’s overall compensation structure. In addition, the Administrator’s VCP provides for a maximum payout limit to NEOs.

The Administrator did not identify any risks arising from its compensation policies and practices that are likely to have a material adverse effect on the Administrator or the Fund.

Compensation of the Chief Executive Officer

Mr. Chapados was appointed President and Chief Executive Officer of the Administrator effective October 12th, 2005. In 2012, Mr. Chapados' annual salary as an executive officer of the Administrator was $248,106. On the retirement of Mr. Chapados on January 31th, 2012, Mr. Álvarez Dávila served as Chief Executive Officer from February 1st, 2012 to June 30th, 2012. Mr. Álvarez’ compensation was not attributable to the Fund for his services in 2012. Ms. Eva Carissimi became the Chief Executive Officer of the Administrator on July 1st, 2012. In 2012, Ms. Carissimi’s annual salary as Chief Executive Officer was $235,000.

Mr. Chapados and Ms. Carissimi participate in Xstrata Canada's VCP at a target award percentage of base salary established by the Administrator. The performance measures used to determine the annual variable compensation payment, and the weighting attached to each measure, are:

 15% based on attaining and exceeding established performance criteria (as discussed under "Variable Compensation" above).

The amount of the VCP award paid to Mr. Chapados and Ms. Carissimi under the Administrator's 2012 VCP and attributable to the Fund was $1,504 and $16,551. The Administrator's assessment of the Chief Executive Officer's performance included the following:

 Zinc metal production for 2012 was 263,697 tonnes compared to a threshold production volume of 260,000 tonnes and a VCP target production volume of 267,000 tonnes; and

 Cost per tonne for 2012 was $709 per tonne compared to a threshold cost per tonne of $711 per tonne and a VCP target cost per tonne of $707 per tonne.

The Fund is charged for the portion of the CEO's VCP award that is linked to the CEO's performance objectives above. The balance of the VCP is based on the overall financial results of Xstrata Canada's zinc business, together with the results of the Fund, and personal objectives set with the CEO, and are paid by Xstrata Canada. For further information, see "Variable Compensation" above.

Purchase of Financial Instruments

Neither the Fund nor the Administrator have policies prohibiting the purchase by the NEOs or Trustees of prepaid variable forward contracts, equity swaps, collars, or units of exchange funds that are designed to hedge or offset a decrease in market value of Units held by such NEOs or Trustees. To the knowledge of the Administrator, as of the date of this Circular, none of the Trustees own any Units and no NEO owns a material number of Units.

2. SUMMARY COMPENSATION TABLE

The following table (presented in accordance with Form 51-102F6 – Statement of Executive Compensation) established pursuant to National Instrument 51-102 – Continuous Disclosure Obligations, sets forth the total compensation earned by the individuals who were, during the fiscal 2012 year, the NEOs performing duties in respect of the Fund. As discussed elsewhere in this Circular, the Fund does not have any other executive officers other than the CEO and CFO of the Administrator, who provide services in respect of the Fund. The Fund does not have any share-based or option-based award plans or any deferred compensation plans.

Non-equity All incentive plan Pension Total Name and Salary Other Year compensation – Value Compensation Principal Position ($) Compensation VCP Award ($) ($) ($) (2) ($) (1)

Eva Carissimi(3) Chief Executive 2012 227,500 16,551 21,965 29,949 295,965 Officer

2012 20,994 1,504 17,000 2,307 41,805 (4) Mario Chapados 2011 248,106 31,261 45,000 36,335 360,702 Chief Executive Officer 2010 242,055 27,050 49,000 34,156 352,261

2012 167,222 9,890(6) 15,940(7) 21,579 214,631 (5) Michael Boone 2011 163,143 15,156(6) 16,047(7) 21,205 215,551 Chief Financial (6) (7) Officer 2010 159,944 14,895 15,736 20,840 211,415

______Notes: (1) For Ms. Carissimi and Mr. Chapados, the VCP amounts represented above were calculated and, awarded based on the factors and objectives described under "Variable Compensation" above. (2) All other compensation for the NEOs consists of perquisites and other personal benefits provided to the NEO that are not generally available to all employees. In the case of Ms. Carissimi, such perquisites and personal benefits included an executive perquisite allowance of $20,437 paid by the Administrator and reimbursed to the Administrator by the Fund. For Mr. Chapados, such perquisites and personal benefits included an executive perquisite allowance of nil (2011 - $19,938; 2010 – $19,452) paid by the Administrator and reimbursed to the Administrator by the Fund. In the case of Mr. Boone, such attributable perquisites and personal benefits include an executive perquisite allowance of $15,328 (2011 - $14,954; 2010 – $14,589) and an automobile taxable benefit of $5,314 (2011 - $5,314; 2010 – $5,314), The incremental cost of perquisites provided to Mr. Chapados was calculated based on amounts actually paid by the Administrator. The incremental cost of perquisites for Mr. Boone was calculated based on the amounts attributable to the Fund.

(3) Ms. Eva Carissimi was appointed CEO on July 1st, 2012. Prior to that, she had worked for the Administrator for the first half of 2012, including being appointed to the role of Vice-President, Operations effective February 1st, 2012. The compensation information disclosed above represents the amount that was charged to the Fund by the Administrator for Ms. Carissimi’s services in 2012.

(4) Mr. Mario Chapados retired from the role of CEO effective January 31st, 2012. The compensation information disclosed above represents the amount that was charged to the Fund by the Administrator for Mr. Chapados’ services for the period January 1 to January 31st, 2012. (5) Mr. Boone spent approximately 75% of his time on his duties as Chief Financial Officer in 2012 (2011 – 75% and 2010 – 75%). The remainder of his time is spent on activities for the Administrator's parent, Xstrata Canada. The Administrator charges the Fund the noted amounts for the services provided by Mr. Boone based on the attributable compensation associated with the Administrator's assessment of the compensation applicable for positions in the mining industry of a similar nature. For further details, see "Statement of Executive Compensation" above. (6) The VCP award for Mr. Boone reflects the amount of such award attributable to the Fund, and was awarded based on the factors and objectives described under "Variable Compensation" above. The VCP award shown did not relate to any corporate-level financial targets relating to the Fund.

(7) The pension value for Mr. Boone reflects the portion of the Administrator’s defined contribution plan that is attributable to the Fund for the services provided by Mr. Boone in respect of the Fund. Other than the service costs attributed to the Fund, the remaining future payment obligations, including accrued obligations, any compensatory and non-compensatory changes and other costs and expenses are solely for the account of the Administrator and are not attributed to or passed along to the Fund.

3. INCENTIVE PLAN AWARDS

The Fund does not have any share-based or option-based incentive plan awards for its NEOs. Accordingly, the following table provides information for each NEO for fiscal 2012 based on the value earned under the annual performance incentives, which consist exclusively of VCP awards.

Option-based awards – Share-based awards Non-equity incentive plan Value vested during the – Value vested compensation – Value Name year ($) during the year ($) earned during the year ($)

Eva Carissimi(1) Nil Nil Nil Manuel Álvarez Dávila(2) Nil Nil Nil Mario Chapados(3) Nil Nil Nil Michael Boone Nil Nil Nil ______Notes:

(1) Ms. Carissimi was appointed as the CEO of the Administrator on July 1st, 2012.

(2) Mr. Álvarez Dávila served as the CEO from February 1st, 2012 to June 30th, 2012.

(3) Mr. Chapados retired on January 31st, 2012.

4. DEFINED BENEFIT PLAN TABLE

The following table outlines estimated annual benefits, accrued obligations and compensatory and non-compensatory changes in accrued obligations in 2012 for the Chief Executive Officer under the defined benefit pension plan.

Annual benefits Closing Number of payable Opening present years ($) present value Non- Name and Compensatory value of credited of defined compensatory Principal Position change defined service benefit change ($) benefit (#) At year- At age obligation ($) obligation end 65 ($) ($) ($) ($)

(1) Mario Chapados 6.41 35,200 51,500 387,700 17,000 129,300 534,000 Chief Executive Officer ______Notes:

(1) Mr. Chapados retired on January 31st, 2012. The defined benefit obligation represents the obligation for Mr. Chapados related to his time spent with the Administrator.

5. TERMINATION AND CHANGE OF CONTROL BENEFITS

The executives do not have a contract or agreement that provides for payments to them at, following or in connection with any termination, resignation, retirement or change in control. Any termination without cause, resignation or retirement of an NEO may trigger, under and in accordance with applicable law, notice and/or payment of compensation in lieu thereof.

6. PERFORMANCE GRAPH

The Priority Units are listed and posted for trading on the Toronto Stock Exchange (the "TSX") under the symbol "NIF.UN". The following performance graph compares the yearly percentage change in the cumulative total Unitholder return for the five-year period commencing on January 1st, 2008 and ending December 31st, 2012 on the Fund's Priority Units with the cumulative total return of the S&P/TSX Composite Total Return Index.

CUMULATIVE TOTAL RETURN ON $100 INVESTMENT December 31, 2007 - December 31, 2012 120

100

20 déc.-07 déc.-08 déc.-09 déc.-10 déc.-11 déc.-12 Noranda Income Fund 100,0 49,5 32,9 60,3 76,6 70,2 S&P/TSX Composite Total Return 100,0 67,0 90,5 106,4 97,1 104,1 Index

______Notes: (1) Noranda Income Fund figures assume distributions were re-invested on the ex-distribution date. (2) S&P/TSX Composite Total Return Index figures assume dividends were re-invested on the ex-dividend date. Source: Bloomberg

During the five fiscal years between January 1st, 2008 and December 31st, 2012, the cumulative total securityholder return of the S&P/TSX Composite Index compares with the Fund's total Unitholder return and executive compensation generally as follows:

 For the 2012 fiscal year, cumulative Unitholder return declined while the S&P/TSX Composite Index generally increased. Executive compensation decreased during 2012 reflecting lower CEO salary and CEO/CFO VCP awards.

 For the 2011 fiscal year, cumulative Unitholder return outperformed the performance of the S&P/TSX Composite Index. Executive compensation during 2011 increased reflecting higher salaries and VCP awards.

 For the 2010 fiscal year, cumulative Unitholder return outperformed the performance of the S&P/TSX Composite Index. Executive compensation during 2010 increased reflecting higher salaries and VCP awards.

 For the fiscal year 2009, cumulative Unitholder return declined while the S&P/TSX Composite Index generally increased. Executive compensation during this period declined due to lower VCP awards.

 For the fiscal year 2008, cumulative Unitholder return and the S&P/TSX Composite Index both generally declined. Executive compensation during this period increased due to higher salaries, offset in part by lower VCP awards during this period.

The trend shown by the performance graph set forth above represents a fluctuation in the cumulative total shareholder return from December 29th, 2007 to December 30th, 2012, which does not necessarily correspond to the Fund's compensation paid or payable to the NEOs for the period ended December 31st, 2012 or for any prior fiscal periods. The NEOs of the Fund are executives of the Administrator and their compensation is not tied to the performance of the Priority Units on the TSX or corporate-level financial targets of the Fund. In addition, because the proportion of time devoted by the CFO to the Fund varies from year to year as the needs and demands of the Fund require from time to time, as a result, the portion of the CFO's compensation actually attributable to the Fund similarly varies, with the result that the actual compensation of the CFO attributable to the Fund more closely approximates changes in the amount of time required to be devoted to the Fund, rather than the performance of the Priority Units of the Fund. While the NEOs' compensation is in part tied to performance objectives fixed by the Administrator, as discussed above, compensation is ultimately based on several factors, including qualitative factors, in connection with the determination of appropriate levels of compensation as discussed above. Many of the factors are not necessarily tied to the trading price of the Fund's Priority Units

on the TSX or the Fund's business. The trading price of the Priority Units on the TSX is subject to fluctuation based on several factors, many of which are beyond the control of the Fund or the Administrator. Each NEO's compensation is tied to the executive's relative performance in helping the Administrator and the Fund meet various objectives, in addition to meeting performance targets established for each executive.

In addition, the Administrator also relies from time to time on compensation studies and surveys to provide benchmarks having regard to the compensation levels among industry comparables, to ensure that the Administrator continues to compensate its executives fairly and competitively and is able to attract and retain qualified individuals who are essential to fostering long-term success and meeting established strategies and objectives. See also "Statement of Executive Compensation – Compensation Discussion and Analysis" above.

7. FEES FOR COMPENSATION CONSULTANTS:

Towers Watson was retained in 2012 to review the appropriateness of the fees paid to the Trustees at the Board and Committee level, particularly in regard to retainers and attendance fees. The amount of the fees paid to the consultant related to such services was $32,873.

REMUNERATION OF TRUSTEES

For the services rendered as trustee and registrar and transfer agent to the Fund during the fiscal year ended December 31st, 2012, the Sole Trustee of the Fund, Computershare Trust Company of Canada, was paid a total fee of $97,072. This amount reflects the yearly cost to act as the registrar and transfer agent of the Fund and as Sole Trustee.

During the fiscal year ended December 31st, 2012, the Trustees' aggregate payable compensation, including reimbursed expenses, was $866,756.

A review of the Trustees’ remuneration was conducted in 2012. As a result of this review, in 2012, the Trustees were entitled to receive an annual base retainer (expressed as a flat fee) of $60,000 each. The Chair of the Board received an extra yearly $55,000; the Chair of the Audit Committee received an extra yearly $15,000; the Chair of the Governance and Human Resources Committee received an extra yearly $10,000. The Trustees who sit on the Audit Committee and/or the Governance and Human Resources Committee other than their respective Chair, receive an additional $5,000 per annum per committee. Trustees are also reimbursed for all reasonable out-of-pocket expenses incurred in connection with attending meetings of the Board and Committees thereof or otherwise in connection with fulfilling their duties on the Board or a Committee thereof in accordance with the ordinary policies of the Operating Trust and, in the case of the Independent Trustees on the Board, also received certain fees outlined below in respect of their duties as a member of the Independent Committee of the Board. No fees are paid to full-time Xstrata Canada employees serving as Trustees.

During fiscal 2012, there was a standing Independent Committee. The Independent Committee members were entitled to receive the following fees: the Chair of the Independent Committee was entitled to an annual fee of $70,000, the Vice-Chair was entitled to an annual fee of $60,000 and the other members of the Independent Committee were entitled to an annual fee of $50,000, in each case pro-rated for the number of months in a semi-annual period that such members serve on the Independent Committee. Each member of the Independent Committee was also entitled to be paid an additional fee of $1,500 for each meeting of the Independent Committee attended whether in person, by phone or other form of electronic communication. These fees for Independent Trustees are in addition to the fees payable to them as Trustees and as Chairs of the Audit Committee and Governance and Human Resources Committee. Members of the Independent Committee were also reimbursed for all reasonable out-of-pocket expenses incurred in connection with attending meetings of the Independent Committee or otherwise in connection with fulfilling the mandate of the Independent Committee in accordance with the ordinary policies of the Board.

The table that follows indicates the total fees, expense reimbursement and any other compensation, before withholdings, received or earned by or paid or payable to each current and former Trustee in respect of fiscal 2012, in connection with his or her service as a Trustee on the Board and any Committee thereof. The Trustees are not entitled to any share or option-based awards and nor are they entitled to any non-equity incentive plan compensation or pension awards.

BOARD OF TRUSTEE COMPENSATION FOR 2012

Independent Total Committee Compensation Board/Audit, GHR Retainer Fees Per Meeting Before Expense Committee Retainer Fees Earned(1) Fees Expense Reimbursement Total Trustee Name Earned (1) Earned (2) Reimbursement (3) Compensation

Manuel Álvarez Nil Nil Nil Nil Nil Nil (8) Dávila Jean Pierre Ouellet (5) $75,000 $50,000 $43,500 $168,500 $15,423 $183,923 François R. Roy (7) $70,000 $60,000 $43,500 $173,500 $5,014 $178,514 Bob Sippel(9) $60,000 Nil $16,500 $76,500 $2,139 $78,639 John Swidler (4) $125,000 $70,000 $43,500 $238,500 $10,579 $249,079 Barry Tissenbaum (6) $80,000 $50,000 $43,500 $173,500 $3,101 $176,601

(8) John Whyte Nil Nil Nil Nil Nil Nil Total: $410,000 $230,000 $190,500 $830,500 $36,256 $866,756 ______Notes: (1) The amounts listed include all Board and Committee retainer fees earned by each Trustee in respect of fiscal 2012 other than the Independent Committee fees. (2) The amounts listed include all per meeting Independent Committee fees earned by each Trustee in respect of fiscal 2012. (3) Except as otherwise disclosed, no other cash or non-cash compensation is paid or payable to Trustees in connection with their service on the Board. The amounts listed represent all expense reimbursement (mainly travel expenses) paid to each Trustee in respect of fiscal 2012 in connection with the Trustees’ service as a Trustee on the Board. (4) Mr. Swidler was appointed to the Board effective October 7th, 2010. Since his appointment to the Board, Mr. Swidler has served as the Chair of the Board and as a member of the Audit Committee and the Governance and Human Resources Committee. Mr. Swidler is also the Chair of the Independent Committee. (5) Mr. Ouellet was appointed to the Board effective October 7th, 2010. Since his appointment to the Board, Mr. Ouellet has also served as the Chair of the Governance and Human Resources Committee and as a member of the Audit Committee. Mr. Ouellet is also a member of the Independent Committee. (6) Mr. Tissenbaum was appointed to the Board effective October 7th, 2010. Since his appointment to the Board, Mr. Tissenbaum has also served as the Chair of the Audit Committee and as a member of the Governance and Human Resources Committee. Mr. Tissenbaum is also a member of the Independent Committee. (7) Mr. Roy was appointed to the Board effective October 7th, 2010. Since his appointment to the Board, Mr. Roy has also served as a member of the Audit Committee and the Governance and Human Resources Committee. Mr. Roy is also Vice-Chair of the Independent Committee. (8) As noted above, no fees are earned by full-time Xstrata Canada employees (being Messrs. Álvarez Dávila and Whyte) in respect of their service as Trustees on the Board. (9) On occasion, the Chair of the Independent Committee invites Mr. Sippel to attend meetings of the Independent Committee. He received compensation of $1,500 per meeting attended. Mr. Sippel resigned from the Board on February 12th, 2013.

MANAGEMENT OF THE FUND

The Fund's principal and sole operating asset is its interest in the electrolytic zinc plant and processing facility (together with associated roasters, acid plants, remediation facilities, settling ponds, wastewater treatment plants and related assets and equipment) located in Salaberry-de- Valleyfield, Québec (the "Processing Facility"), which it indirectly owns through the Operating Trust, 1884699 Ontario Inc. and NILP. The Processing Facility produces refined zinc metal and various by-products from zinc concentrate purchased from mining operations and it sells refined zinc products to customers in the open market. The Fund was created to acquire, indirectly through the Operating Trust and NILP, the Processing Facility from Noranda Inc. ("Noranda") in 2002. Canadian Electrolytic Zinc Limited (the Administrator and alternatively, the "Manager"), a wholly-owned subsidiary of Xstrata Canada (through its Xstrata Zinc Canada division), operates and manages the Operating Trust and Processing Facility and administers the Fund. The Manager’s head office is located at 860, boul Gérard-Cadieux, Salaberry-de-Valleyfield, Quebec, J6T 6L4. Xstrata Canada has an effective 25% interest in the Fund, which is held indirectly through a wholly-owned subsidiary through its ownership of Ordinary Units of NILP and Special Fund Units of the Fund. Concurrently with the creation of the Fund and the acquisition of the Processing Facility by NILP from Noranda in 2002, the Administrator entered into various agreements with NILP, the Fund and/or the Operating Trust relating to the management, administration and operation of the Fund, the Operating Trust, NILP and the Processing Facility. In August 2006, Xstrata Canada acquired Falconbridge Limited, the successor corporation to Noranda. Xstrata Canada is a wholly-owned subsidiary of Xstrata plc.

O&M Agreement

NILP has entered into an operating and management agreement dated May 3rd, 2002 (the "O&M Agreement"), pursuant to which the Manager operates, manages and maintains on an ongoing basis the Processing Facility owned by NILP and provides management services to NILP, including the preparation of annual operating and maintenance plans and capital improvement plans for approval by the directors of the general partner of NILP, reporting to the general partner of NILP on the operation of the Processing Facility and the business of NILP, providing accounting and record keeping services, including coordination and management of accounting, cash management, treasury and other systems, and the preparation of financial statements and other reports on operations. The Manager is responsible for providing all employees or other personnel necessary to provide the services to NILP and to carry out its obligations under the O&M Agreement. In consideration for providing services under the O&M Agreement, the Manager is entitled to a management fee of $250,000 per annum, adjusted upward by 2% per annum beginning on January 1st, 2004, and reimbursement of certain direct and indirect specified costs and expenses incurred by the Manager in the course of performing its duties. The O&M Agreement has an initial term of 15 years that ends on May 2nd, 2017 and will renew thereafter for five year terms unless the Manager provides NILP with written notice to the contrary prior to the expiry of the applicable term or upon the occurrence of certain other events. The O&M Agreement may also be terminated upon the occurrence of certain enumerated events and subject to certain conditions.

Management Services Agreement

Pursuant to a management services agreement dated April 18th, 2002 (the "Management Services Agreement") between the Operating Trust and the Manager, the Manager provides management services to the Operating Trust. These services include, among other things, assisting the Operating Trust in: (i) developing, implementing and monitoring a strategic plan; (ii) developing an annual business plan which may include operational and capital expenditures budgets when appropriate; (iii) developing acquisition strategies, investigating potential acquisitions and analyzing the feasibility of potential acquisitions; (iv) carrying out acquisitions or dispositions and related financings required for such transactions; (v) assisting in connection with any financing of the Operating Trust or the Fund; and (vi) preparing, planning and co-ordinating management and Trustees' meetings. In consideration for providing the services under the Management Services Agreement, the Manager is entitled to reimbursement of its direct and indirect costs and expenses incurred in connection with its duties under the Management Services Agreement. The Management Services Agreement has an initial 15 year term that ends on May 2nd, 2017 and will automatically renew for five year terms unless the Manager provides the Operating Trust with written notice to the contrary prior to the expiry of the applicable term or upon the occurrence of certain other events. The Management Services Agreement may also be terminated upon the occurrence of certain enumerated events and subject to certain conditions.

Administration Agreement

Pursuant to an administration agreement dated April 18th, 2002 (the "Administration Agreement") between the Fund and the Administrator, the Sole Trustee of the Fund has delegated most of its powers and authority to the Administrator, a wholly-owned subsidiary of Xstrata Canada, and the Administrator provides certain administrative and support services to the Fund, including those necessary to: (i) facilitate compliance by the Fund with continuous disclosure obligations under applicable securities legislation; (ii) provide investors relations services; (iii) provide or cause to be provided to Unitholders all information to which Unitholders are entitled under the Fund Indenture including relevant information with respect to income taxes; (iv) call, hold and distribute materials, including notices of meetings and information circulars, in respect of all meeting of Unitholders; (v) provide for the calculation of distributions to Unitholders; (vi) attend to all administrative and other matters arising in connection with any redemption of Priority Units; and (vii) ensure compliance with the Fund's limitations on non-resident ownership. The Administrator is entitled to be paid all costs and expenses it incurs in connection with its performance of the services rendered in respect of any given period, in accordance with generally accepted accounting principles, which costs are for the account of the Fund. The Administrator must obtain written approval from the Fund to charge the Fund for anything other than those services contemplated by the Administration Agreement. The Administration Agreement has an initial 15 year term that ends on May 2nd, 2017 and will automatically renew thereafter for five year terms unless the Administrator provides the Fund with written notice to the contrary prior to the expiry of the applicable term or it is terminated in accordance with its terms. The Administration Agreement may be terminated upon the occurrence of certain enumerated events and subject to certain conditions.

Supply and Processing Agreement

In addition, Xstrata Canada and NILP are parties to a supply and processing agreement dated May 3rd, 2002 (the "Supply and Processing Agreement") pursuant to which Xstrata Canada is obligated to sell to NILP, except in certain limited circumstances, all of the Processing Facility's zinc concentrate requirements up to a maximum of 550,000 tonnes of zinc concentrate per year at a price based on the zinc metal price on the London Metal Exchange for the "payable zinc metal" contained in the concentrate, less a fixed, escalating processing fee (initially set at $0.352 per pound of payable zinc metal). In 2012, the processing fee was $0.392 per pound, and an aggregate of approximately $317.1 million was sold by Xstrata Canada to NILP in respect of zinc concentrate supplied by Xstrata Canada pursuant to the Supply and Processing Agreement. Additionally, the Supply and Processing Agreement provides that Xstrata Canada will act as exclusive agent for NILP to arrange for purchases of any additional zinc concentrate in excess of the 550,000 tonne amount described above, and for sales of zinc metal and by-products and related hedging arrangements. Xstrata Canada does not receive any additional fee for acting as agent, but is entitled to be reimbursed for all direct and indirect costs and expenses incurred in connection with its duties as agent. Indirect costs are determined on a consistent basis with Xstrata Canada's internal cost allocations and reasonable cost accounting allocation principles. For fiscal 2012, a total of $2.0 million was paid by NILP to Xstrata Canada in fees and reimbursable expenses pursuant to the Supply and Processing Agreement.

The Supply and Processing Agreement has an initial 15 year term that expires on May 2nd, 2017 and, except for provisions concerning the committed amount of zinc concentrate and processing fees, will automatically renew thereafter for five year terms unless Xstrata Canada gives

written notice to the contrary prior to the expiry of the applicable term or upon the occurrence of certain other events. The Supply and Processing Agreement may also be terminated upon the occurrence of certain enumerated events and subject to certain conditions. The expiry of the Supply and Processing Agreement will result in a concurrent termination of the O&M Agreement. If the Supply and Processing Agreement terminates and is not replaced with a similar agreement providing for a known supply source of zinc concentrate, NILP will need to seek out alternative zinc concentrate supply and other relationships, including those which may cause it to become dependent on seaborne supplies of zinc concentrate.

Additional descriptions of the above agreements pursuant to which management functions of the Fund, the Operating Trust and NILP are conducted are available in the Fund's 2012 Annual Information Form under the headings "The Administrator and Manager" and "Xstrata Canada Corporation – Major Agreements", in the Management’s Discussion and Analysis for the fiscal year ended December 31st, 2012 under the heading "Transactions with Related Parties", and in the notes to the Consolidated Financial Statements of the Fund for the fiscal year ended December 31st, 2012 under the headings "Supply and Processing Agreement" and "Related Parties". Such descriptions are hereby incorporated by reference into this Circular. The foregoing summaries are qualified in their entirety by reference to the full provisions of each of the above-referenced agreements, copies of which are available on SEDAR at www.sedar.com.

Management and Administration Fees

As a result of the Administration Agreement between the Fund and the Administrator, the Management Services Agreement between the Operating Trust and the Manager and the O&M Agreement between NILP and the Manager, the Administrator has been paid the following amounts for administration, management and operating services for the fiscal year ended December 31st, 2012:

Fiscal Year ended December 31st, 2012

(1) Employee salary and benefits $67,958,000 Support services $1,246,000 O&M Agreement management fee $299,000 Total $69,503,000 ______

Note:

(1) This represents all amounts paid in respect of salaries and benefits for all of the employees of the Administrator in connection with the operation of the Processing Facility and the services provided to the Fund, the Operating Trust and NILP and includes the amounts paid to the NEOs as described under "Summary Compensation of Named Executive Officers" above.

The following individuals are the directors and officers of the Administrator of the Fund, Canadian Electrolytic Zinc Limited :

Name Municipality of Residence Position

Eva Carissimi(1) Salaberry-de-Valleyfield, Québec President and Chief Executive Officer

Michael Boone Toronto, Ontario Vice President, Chief Financial Officer and Director

G. Reid Bowlby Toronto, Ontario Vice President, Marketing

John Whyte Toronto, Ontario Director

Neil Wardle Toronto, Ontario Director

Ginette Berthel Gatineau, Québec Corporate Secretary

(1) Ms. Carissimi was appointed President and Chief Executive Officer on July 1st, 2012.

The Administrator is a wholly-owned subsidiary of Xstrata Canada, a corporation existing under the laws of Ontario. An indirect wholly-owned subsidiary of Xstrata Canada, in turn, holds all of the outstanding Ordinary Units of NILP and outstanding Special Fund Units of the Fund.

COMMUNICATION AND CORPORATE DISCLOSURE POLICY

The Fund and the Operating Trust have a corporate disclosure policy, which summarizes their policies and practices regarding disclosure of material information to investors, analysts and the media. The purpose of this policy is to ensure that the Fund's communications with the investment community are timely, consistent and in compliance with all applicable securities legislation. The Operating Trust has established a Corporate Disclosure Committee responsible for developing (with the approval of the Board), implementing and overseeing the Fund's disclosure policy and practices. The Corporate Disclosure Committee is composed of Eva Carissimi, Michael Boone, Ginette Berthel and Marguerite Manshreck-Head. The Corporate Disclosure Committee is required to meet with, and report to, the Audit Committee quarterly.

The Fund maintains an investor relations program to respond to inquiries in a timely manner. Management meets with investment analysts and financial advisors to ensure that accurate information is available to investors, including conference calls and meetings to discuss the Fund's quarterly financial results. The Fund also ensures that the media are kept informed of developments as they occur through regular press releases.

The Fund also endeavours to keep its Unitholders informed of its progress through a comprehensive annual report, quarterly interim reports and press releases. It also maintains a website that provides summary information on the Fund and ready access to its published reports, press releases, statutory filings and supplemental information provided to analysts and investors. The Fund's website can be found at www.norandaincomefund.com. The Trustees and management meet with the Unitholders at the annual meeting and are available to answer questions at that time.

COMMITTEES OF THE BOARD

In the normal course of business, the Board currently has three standing committees: the Audit Committee, the Governance and Human Resources Committee and the Independent Committee.

The Audit Committee

The Audit Committee is responsible for, among other things, monitoring the Fund's systems and procedures for financial reporting, risk management and internal controls, reviewing all public disclosure documents and monitoring the performance of the Fund's external auditors. The Audit Committee is also responsible for reviewing the Fund's quarterly and annual financial statements and management's discussion and analyses ("MD&A") and annual and interim earnings press releases prior to their approval by the Board and disclosure to the public. The Audit Committee also meets periodically in private with the Fund's external auditors to discuss and review specific issues as appropriate. The Audit Committee met four times in 2012.

As at April 4th, 2013, the Audit Committee is comprised of the following four Trustees all of whom are “independent” trustees as defined by National Instrument 52-110 – Audit Committees (“NI 52-110”): Messrs. Barry Tissenbaum (Chair), Jean Pierre Ouellet, John J. Swidler and François R. Roy.

A Whistleblowing Procedure has been put in place which provides a hotline where employees may anonymously, if they so choose, report activities of a financial nature with which they are not comfortable. In the normal course of business, these calls are monitored by the Audit Committee. In the absence of a member of the Audit Committee, the Corporate Secretary assumes this role.

At most regular Audit Committee meetings in 2012, the members of the Committee held meetings without the presence of management. The text of the Audit Committee Mandate can be found in the Fund's 2012 Annual Information Form available on SEDAR at www.sedar.com.

Each member of the Audit Committee is financially literate, i.e., has the ability to read and understand financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the Fund's financial statements. Collectively, the Audit Committee has the education and experience necessary to fulfill the responsibilities outlined in the Audit Committee Mandate. The education and current and past experience of each Audit Committee member that is relevant to the performance of his responsibilities as an Audit Committee member is summarised below:

Jean Pierre (J.P.) Ouellet  Bachelor of Arts, License in Civil Law, University of Montreal  Bachelor of Civil Law, Oxford University (Rhodes Scholar)  Corporate Lawyer, Stikeman Elliott LLP (1976 – 1996)  Chief Legal Officer, Senior Executive Committee Member, Canadian National Railways Inc. (1996 – 2000)  Vice Chairman, Québec, RBC Capital Markets (2000 – 2008)  Chair of Audit Committee, C-MAC Industries Inc. (1992 – 2002)

François R. Roy  Masters of Business Administration, University of Toronto  Previous member of the Accounting Standards Board of the Canadian Institute of Chartered Accountants  Chief Financial Officer, Quebecor Inc. (1990 – 1997) (1998-2000)  Chief Financial Officer, Avenor Inc. (1997 – 1998)  Chief Financial Officer, Telemedia Inc. (2000 – 2003)  Vice Principal (Administration and Finance), McGill University (2007 – 2010)  Current Chair of Audit Committee, Capstone Infrastructure Corporation  Current Member of Audit Committee, Transcontinental Inc.  Current Member of the Audit Committee, Caisse de dépôt et placement du Québec

John J. Swidler  Bachelor of Commerce and Bachelor of Civil Law, McGill University  Chartered Professional Accountant (CPA, CA), Richter, Usher & Vineberg (now Richter LLP) (1969 – 2008)  Chartered Professional Accountant (CPA, CA) designation (1967) and Fellow Chartered Professional Accountant (FCPA) designation (1992) Québec  President, Canadian Association of Insolvency and Restructuring Professionals (1984)  Founding Member, Vice President and Director, Insolvency Institute of Canada  Current Chair of Audit Committee, Dollarama Inc.  Current Chair of Audit Committee, Reitmans (Canada) Limited

Barry Tissenbaum (Chair)  Chartered Professional Accountant (CPA, CA) designation (Québec, 1968 and Ontario, 1974)  Partner, Ernst & Young LLP (1991 – 2005), including service as Director of Retail and Consumer Products (1996 – 2000) and Managing Partner, Toronto Midtown office (1991 – 1996)  Chair of Audit Committee, Universal Energy Group Ltd. (2007 – 2009)  Member of Audit Committee, Northstar Healthcare Inc. (2007 – 2010)  Chair of Audit Committee, Corel Corporation (2009 – 2010)  Current Member of Investment Review Committee, Faircourt Asset Management  Current Chair of Audit Committee, Medworxx Solutions Inc.

For more information on the Audit Committee (including the information required by Form 52-110F1 of NI 52-110), please see the information set out under the heading "Audit Committee Information" in the Fund's 2012 Annual Information Form.

The Governance and Human Resources Committee

It is the responsibility of the Governance and Human Resources Committee to, among other things, annually assess the size and composition of the Board and its Committees, to review the effectiveness of the Board's operations and its relations with management, to review

the Fund's statement of corporate governance practices, and to review and recommend Trustees' compensation. Each year, the Administrator (or Xstrata Canada), conducts a review of the compensation and remuneration policies applicable to its executive officers, including those who provide services in respect of the Fund, and reports to the Governance and Human Resources Committee, which then considers the results of such review as it applies to the annual compensation and performance reviews of the CEO and the CFO. The Governance and Human Resources Committee is also responsible for the Board's succession planning, reviewing the credentials of nominees for election or appointment to the Board, recommending candidates for Board membership and for interfacing with Xstrata Canada which, by the terms of the Trust Indenture, is entitled to propose the nominees for election of Trustees. The Governance and Human Resources Committee met four times in 2012.

As at April 4th, 2013, the Governance and Human Resources Committee is comprised of the following four Trustees all of whom are “independent” trustees: Messrs. Barry Tissenbaum , Jean Pierre Ouellet (Chair), John J. Swidler and François R. Roy.

The Governance and Human Resources Committee annually reviews the performance of the Board and its Committees and the individual contribution of Trustees through a self-survey and peer review. See also "Corporate Governance Disclosure" below.

The Independent Committee

As at April 4th, 2013, the Independent Committee is comprised of the following four Trustees, all of whom are "independent" trustees. They include Messrs. Barry Tissenbaum, Jean Pierre Ouellet, John J. Swidler (Chair) and François R. Roy. In pursuance of the Independent Committee mandate, the Board has authorized the establishment of a subcommittee of the Independent Committee and has appointed Mr. François R. Roy as Vice-Chair of the Independent Committee. The rationale for the subcommittee was to both maximize the Independent Committee's efficiency in addressing the various issues and to achieve certain cost-savings relating thereto. For further details, see the section entitled "Remuneration of Trustees" above.

Since their appointment on October 7th, 2010, the Independent Trustees have educated themselves with the Fund's business and its financial position, results and prospects, and have had discussions with representatives of Xstrata Canada and its affiliates regarding global market trends for the Fund's products and services. In addition, they played an active role in the refinancing that was successfully completed in July 2011, which has provided financial stability to the Fund.

With the financing issue resolved, the Independent Committee has turned its attention to transition issues and planning for the possible expiry of the Supply and Processing Agreement in May 2017.

The Supply and Processing Agreement will be automatically renewed with Xstrata Canada for a period of five years unless Xstrata Canada provides the Partnership with written notice to the contrary by November 2016, of its decision with respect to an extension, if any, beyond 2017.

In order to prepare for the potential non-renewal of the Supply and Processing Agreement by Xstrata Canada and given the uncertainty regarding zinc concentrate supply post-May 2017, the Board, under the guidance of its Independent Committee, undertook a review in 2011 to determine the availability of funds for future distributions while at the same time, determining whether the Fund would be able to secure zinc concentrate in the market, should the Supply and Processing Agreement not be renewed.

The resulting report indicated, without concluding and subject to certain major assumptions, that the Processing Facility could operate profitably after May 2017 if the Fund was able to secure zinc concentrate in the market.

The Independent Committee met 29 times in 2012.

In addition, in 2012, the Fund committed to increase the 2013 capital investment program to enable the Processing Facility to treat a more varied feed quality mix. During the year, the Fund advised that with the closure of Brunswick Mine, the Processing Facility may be required to treat concentrate containing higher levels of impurities. In order for the Processing Facility to be able to treat a more varied feed quality mix in the future, it is important that it increase its silica removal capabilities. Approximately $20 million will be invested in 2013 to do so.

Other Developments

In 2012, the Board, through its Independent Committee, has retained the services of an industry consultant to assist in identifying possible alternative sources of zinc concentrate after the expiry of the Supply and Processing Agreement in May 2017.

Structure

The Independent Committee, together with the Board, reviewed the tax impact and other consequences to the Fund and its Unitholders for the Fund to convert to a corporation, while considering the impact of remaining as a trust. The Independent Committee engaged Canaccord Genuity to act as an independent advisor to assist them in this regard.

In 2012, the Independent Committee recommended to the Board of Trustees not to pursue a conversion of the Fund to a corporation. The conversion could only have been completed on terms that were acceptable to both unitholders of the Fund and Xstrata Canada, the holder of the

Ordinary Units of the Partnership. The Independent Committee and Xstrata Canada discussed the terms on which such a conversion could occur, but they were unable to reach an agreement.

As an alternative to a conversion to a corporation, the Trustees, with the support of Xstrata Canada, approved an internal reorganization that eliminated the need for the Fund to declare an annual in-kind distribution to reduce its effective tax rate, commencing in fiscal 2012. As a result of this reorganization, it is expected that unitholders will be taxed only on the income they receive as cash distributions.

The reorganization did not affect any of the arrangements between Xstrata Canada and the Fund or the Partnership, including the subordination of distributions on Xstrata Canada's Ordinary Units.

CORPORATE GOVERNANCE DISCLOSURE

FORM 58-101F1 OF NATIONAL INSTRUMENT 58-101 – DISCLOSURE OF CORPORATE GOVERNANCE PRACTICES ("NI 58-101")

Corporate governance relates to the activities of the Trustees, who are elected indirectly by, and are indirectly accountable to, the Unitholders (or, when permitted under the Trust Indenture, may be appointed by the remaining Board members to fill vacancies on the Board that may arise from time to time) and takes into account the role of the Administrator which is charged with the ongoing management of the Fund and the Operating Trust.

The Fund is a limited purpose trust and its activities are currently limited to owning trust units and trust notes of the Operating Trust. The Fund Indenture between Computershare Trust Company of Canada, as Sole Trustee and Xstrata Canada (as successor to Noranda), which governs the Fund through the Administrator, provides that the Sole Trustee will exercise its powers and carry out its functions thereunder honestly, in good faith with a view to the best interest of the Fund and the Unitholders. The Fund Indenture further provides that the Sole Trustee will be deemed to have satisfied its standard of care to the extent that it has contracted or delegated the performance of certain activities to a manager, including the Administrator. The Sole Trustee has delegated the performance of most of its powers and authority to the Administrator. Therefore, the Fund believes that the review of corporate governance should be made at the level of the Operating Trust.

The Board encourages sound corporate governance practices designed to promote the well-being and ongoing development of the Operating Trust (and consequently of the Fund), having always as its ultimate objective the best long-term interests of the Fund and the Operating Trust and the enhancement of value for all Unitholders. The Board also believes that sound corporate governance policies and practices benefit the Operating Trust, the Fund and the communities in which they operate.

The Board is of the view that the Operating Trust's corporate governance policies and practices, outlined below, are comprehensive and consistent with the guidelines for improved corporate governance in Canada as recommended in NI 58-101 as follows:

1. Board of Trustees of Noranda Operating Trust

a) Disclose the identity of trustees who are independent:

At present, four of the seven Trustees of the Board are independent. The Independent Trustees are: John J. Swidler, Jean Pierre Ouellet, Barry Tissenbaum and François R. Roy.

b) Disclose the identity of trustees who are not independent, and describe the basis for that determination:

Manuel Álvarez Dávila holds the position of Executive General Manager Corporate for Xstrata Zinc since July 1st, 2012. Previously, he was appointed Chief Operating Officer of Xstrata Zinc Canada on January 15, 2009. He also occupied the position of Chief Executive Officer of Canadian Electrolytic Zinc Limited, the Administrator of the Fund from February 1, 2012 until June 30, 2012. Neil Wardle holds the position of Chief Operating Officer of Xstrata Zinc Canada. John Whyte is Vice-President, Legal of Xstrata Zinc Canada. Former Trustee Bob Sippel was the former Chief Operating Officer, Xstrata Zinc Canada until January 15th, 2009. He retired in February 2009.

In each of the above cases, the Trustee's current or former relationship with Xstrata Canada has been determined to constitute a "material relationship" for purposes of NI 52-110, such that the Trustees named above should be recognized as not being independent pursuant to NI 52-110. A "material relationship" is defined in NI 52-110 to mean any relationship, which could, in the view of the Board, be reasonably expected to interfere with the exercise of a Trustee's independent judgment.

c) Disclose whether or not a majority of trustees are independent. If a majority of trustees are not independent, describe what the Board of Trustees does to facilitate its exercise of independent judgment in carrying out its responsibilities:

A majority of the Trustees are "independent" as defined by NI 52-110. On an annual basis, the Board, in consultation with the Governance and Human Resources Committee, reviews the relationship between each Trustee and the Fund and the Operating Trust in order to determine whether each Trustee is or remains independent. Based on reference to the independence requirements, including NI 52-110 and the terms of the Trust Indenture, and a review of the applicable factual circumstances against these standards, the Board, in consultation with the Governance and Human Resources Committee, has determined that the majority of its Trustees are independent.

d) If a trustee is presently a director or trustee of any other issuer that is a reporting issuer (or the equivalent) in a jurisdiction or a foreign jurisdiction, identify both the trustee and the other issuer:

John J. Swidler: Dollarama Inc., Reitmans (Canada) Limited Barry Tissenbaum: Medworxx Solutions Inc. François R. Roy: Transcontinental Inc., Capstone Infrastructure Corporation

e) Disclose whether or not the independent trustees hold regularly scheduled meetings at which non-independent trustees and members of management are not in attendance. If the independent trustees hold such meetings, disclose the number of meetings held since the beginning of the issuer's most recently completed financial year. If the independent trustees do not hold such meetings, describe what the Board does to facilitate open and candid discussion among its independent trustees:

The Board meets at least once each quarter, with additional meetings held when appropriate. In 2012, there were 10 meetings of the Board. At most regular meetings in 2012, the Independent Trustees held meetings without the presence of management or Trustees that are not independent. The Independent Trustees appointed by the Board continue to hold regularly scheduled meetings at which non-independent Trustees and members of management are not in attendance. In addition, such Independent Trustees have been appointed to the Independent Committee of the Board, which Committee (or the established subcommittee thereof) regularly holds separate meetings in respect of certain matters within its mandate, to avoid any actual or perceived conflicts.

f) Disclose whether or not the chair of the Board is an independent trustee. If the Board has a chair or lead trustee who is an independent trustee, disclose the identity of the independent chair or lead trustee, and describe his or her role and responsibilities. If the Board has neither a chair that is independent nor a lead trustee that is independent, describe what the Board does to provide leadership for its independent trustees:

The Chair of the Board is held by John J. Swidler, an Independent Trustee. The Chair manages the business of the Board, sets the agenda for Board meetings, facilitates communication between the Independent Trustees and management of the Fund and the non- independent Trustees and ensures that the functions identified in its Mandate are being effectively carried out by the Board and its Committees. The Chair is also responsible for leading the Board and organizing it to function in coordination with, but independently of, the Administrator of the Fund and its management, in order to facilitate the achievement of the goals of the Operating Trust and the Fund. The Chair reviews any comments or requests made by Independent Trustees and oversees the process by which information is made available to the Independent Trustees concerning the Fund's business and activities. In addition, each of the Committees of the Board is chaired by an Independent Trustee.

g) Disclose the attendance record of each trustee for all Board meetings held since the beginning of the issuer's most recently completed financial year:

Please see the table under the section entitled "Meetings Held and Attendance of Trustees" on page 11 of this Circular.

2. Board Mandate – Disclose the text of the Board's written mandate. If the Board does not have a written mandate, describe how the Board delineates its role and responsibilities:

The Board Mandate can be found at Appendix "A" to this Circular.

3. Position Descriptions

a) Disclose whether or not the Board has developed written position descriptions for the chair and the chair of each Board committee. If the Board has not developed written position descriptions for the chair and/or the chair of each Board committee, briefly describe how the Board delineates the role and responsibilities of each such position:

The Board has developed written position descriptions for the Chair of the Board and for the Chairs of the Audit Committee and the Governance and Human Resources Committee. The responsibilities of the Chair are discussed further above. In addition, from time to time the Board may establish an independent committee of Independent Trustees to review and consider particular issues that arise. In such cases, the Board typically establishes a mandate for the independent committee, which includes, among other things, the scope of duties and responsibilities of the members of the independent committee and its Chair at the time such committee is formed. The position descriptions are reviewed by the Board and the Governance and Human Resources Committee on an annual basis and, if necessary, revised to ensure they remain responsive to the requirements and best interests of the Fund.

b) Disclose whether or not the Board and CEO have developed a written position description for the CEO. If the Board and CEO have not developed such a position description, briefly describe how the Board delineates the role and responsibilities of the CEO:

The Board and the Administrator have developed a written position description for the Administrator's CEO. The position description is reviewed by the Board and the Governance and Human Resources Committee, in consultation with the CEO, on an annual basis and, if necessary, revised to ensure that it remains responsive to the requirements and best interests of the Fund.

The Board and the Administrator have also developed a written position description for the Administrator’s Chief Financial Officer.

4. Orientation and Continuing Education

a) Briefly describe what measures the Board takes to orient new trustees regarding (i) the role of the Board, its committees and it trustees, and (ii) the nature and operations of the issuer's business:

- New Trustees are provided with access to the Chair of the Board and each Committee of the Board.

- New Trustees attend meetings with the Administrator of the Fund and receive presentations and/or briefings by, and have access to ask questions of, management concerning, among other things, the business, operations and financial condition of the Fund.

- New Trustees are informed of the legal duties and obligations required of a trustee of a publicly-held entity.

- New Trustees are given up-to-date information on the Fund's organization and structure, governance documents, financial statements and operating results, constituting agreements, policies and procedures and other material agreements and continuous disclosure documents of the Fund and its subsidiaries.

- Arrangements are made for a plant visit and specific briefing sessions from appropriate senior personnel to help new Trustees better understand the Fund's strategies and operations.

b) Briefly describe what measures, if any, the Board takes to provide continuing education for its trustees. If the Board does not provide continuing education, describe how the Board ensures that its trustees maintain the skill and knowledge necessary to meet their obligations as trustees:

The following continuing education guidelines have been approved by the Board for both new and existing Trustees:

- At Board meetings, management and outside service providers are invited on a regular basis to make presentations and provide briefings on different aspects of the business, financial condition, operations and industry developments; - Guided plant visits are performed as appropriate; - Once per year, all members attend a strategic planning session with management; - Quarterly, all members receive a presentation on the review of the business market and world markets; - Timely updates are distributed for insertion in the Governance Manual; - Material governance literature is distributed periodically to the Board members; - Trustees who are not members of the Committees attend the Committee meetings as guests when appropriate; and - In the yearly Board self-survey, the members are questioned on their needs and preferences for continuing education and, following review, the Board acts accordingly.

Since the appointment of the current Independent Trustees in October 2010, the Independent Trustees have taken steps to improve their understanding of the business of the Fund. They have attended plant tours and orientation sessions as well as presentations by consultants on the zinc business in North America and around the world.

The Fund has also developed Board and Committee work plans which are updated on a regular basis and circulated to the Board and Committee members.

5. Ethical Business Conduct

a) Disclose whether or not the Board has adopted a written code for the trustees, officers and employees. If the Board has adopted a written code: (i) disclose how a person or company may obtain a copy of the code; (ii) describe how the Board monitors compliance with its code, or if the Board does not monitor compliance, explain whether and how the Board satisfies itself regarding compliance with its code; and (iii) provide a cross-reference to any material change report filed since the beginning of the issuer's most recently completed financial year that pertains to any conduct of a trustee or executive officer that constitutes a departure from the code:

The Board has adopted its own Code of Business Conduct and Ethics (the "Trust Ethics Code") which applies to the Trustees and the officers of the Operating Trust and to directors and officers of the Fund's subsidiaries. This Trust Ethics Code requires, among other things, that Trustees, directors and officers of the Fund and its subsidiaries: (i) avoid situations in which their personal interests conflict or may conflict with the interests of the Fund, (ii) protect the confidentiality of the Fund's non-public information, (iii) report any illegal or unethical behavior, (iv) monitor the application of the Xstrata Canada Code (discussed below) as it applies to the Administrator's employees, (v) be aware of and comply with all laws, rules and regulations applicable to such individual, (vi) deal fairly with the Fund's customers, suppliers and competitors, and (vii) conduct themselves with the highest standards of honesty, integrity, in good faith, and with a view to the best interests of the Operating Trust and the Unitholders of the Fund. Any violations of the Trust Ethics Code are to be reported to the Chair of the Board or a committee thereof, and such violations may be reported anonymously, if desired, through the confidential hotline established under the Administrator's Whistleblowing Procedure (discussed below). The Trust Ethics Code also requires that Trustees, directors and officers of the Operating Trust will be made promptly aware of any violation of the Xstrata Canada Code through the Administrator.

The Fund's Administrator, as a wholly-owned subsidiary of Xstrata Canada, is bound by the Xstrata Canada "Xstrata Zinc Ethic Code" (the "Xstrata Canada Code"). The Board has reviewed the Xstrata Canada Code's expectation of high standards of ethical business conduct. A copy of the Xstrata Canada Code can be found on the Fund's website at www.norandaincomefund.com or on SEDAR at www.sedar.com. All new employees are given a copy of the Xstrata Canada Code and have continued access to the Xstrata Canada Code and from time to time may receive instructions on the Xstrata Canada Code, including annual reminders concerning how to place a complaint, if one arises, pursuant to the Xstrata Canada Code. Because Xstrata Canada’s parent, Xstrata plc, is listed in the UK, the Administrator’s employees are also subject to the new UK Bribery Act. All employees have received anti-bribery training. A hotline has been put in place for employees to anonymously, if they so choose, report activities which they feel are not consistent with the spirit and intent of the Xstrata Canada Code. The hotline is available 24 hours a day, seven days a week, and is responded to by a trained specialist. The specialist prepares a report that documents the question or concern, which report is then communicated to the Administrator's legal counsel and human resources manager and the complaint is then investigated and assessed by a corporate investigations team. Any reports received by the Administrator relating to the Fund are then reported to the Board quarterly, or more often if necessary. The Xstrata Canada Code provides guidelines to ensure that the Administrator's employees respect their commitment to conduct business relationships with respect, openness and integrity. Among other things, the Xstrata Canada Code defines the standards of the Administrator's business practices, to ensure the highest ethical standards, and also sets the standard for all communication with the investing public of the Fund. The Xstrata Canada Code extends to all directors, officers, trustees and employees of the Fund's subsidiaries, its Board of Trustees and all other insiders. The Xstrata Canada Code prescribes standards in relation to various matters, including conduct and equal opportunity in the workplace, health, safety and environmental protection, financial reporting, conflicts of interest, dealing with customers and suppliers, community interaction, corporate governance, regulatory obligations, information security, and enforcement. The Board has not granted any waivers of the Xstrata Canada Code in favour of a Trustee or executive officer of the Fund or the Administrator since the beginning of fiscal 2012 and, accordingly, no material change report has been required to be filed.

In addition to the foregoing, the Administrator has also adopted a Whistleblowing Procedure, which applies to the Administrator's employees who directly or indirectly operate the Processing Facility. The Whistleblowing Procedure outlines procedures for employees to raise questions or report situations relating to business practice, ethical or legal issues. Under the Procedure, such concerns may be reported directly to the employee's supervisor. Alternatively, employees may report any complaints or issues anonymously, either through the hotline established under the Xstrata Canada Code, or through a second hotline or secure, confidential, anonymous website established by the Operating Trust, in respect of which the Audit Committee has established procedures to receive and address any such complaints relating to accounting, financial, internal accounting controls or auditing matters. All such complaints are summarized quarterly and reported to the Board of Trustees of the Fund, either by management of the Administrator, in the case of complaints through the Xstrata Canada Code hotline, or by the Chair of the Audit Committee, in the case of complaints pertaining to accounting, internal accounting controls, and financial and auditing issues.

b) Describe any steps the Board takes to ensure trustees exercise independent judgment in considering transactions and agreements in respect of which a trustee or executive officer has a material interest:

The Trust Indenture of the Operating Trust requires Trustees and officers to disclose to the Trustees the nature and extent of any interest a Trustee or officer may have by virtue of being a party to a contract or transaction or proposed contract or transaction with the Fund, the Operating Trust or any of their respective affiliates or by virtue of being a director or officer of, or otherwise having a material interest in, any person or affiliate of any person who is a party to a contract or transaction or proposed contract or transaction with the Fund, the Operating Trust or any of their respective affiliates.

The duties and responsibilities of Trustees also include: (a) preventing personal interests from conflicting with, or appearing to conflict with, the interests of the Fund and disclosing details of any actual, perceived or potential conflicts of interest that may arise; and (b) voting on all matters requiring a decision of the Board or its Committees except where a conflict of interest exists, in which case voting is prohibited under the Trust Indenture (subject to certain exceptions). Trustees who find themselves in a real or potential conflict of interest are required to immediately declare their interest to the Board and, if required pursuant to the Trust Indenture, refrain from participating in any discussion about the conflicting issue or from voting thereon.

c) Describe any other steps the Board takes to encourage and promote a culture of ethical business conduct:

Trustees do not undertake any consulting activities for, or receive any remuneration directly from, the Fund or the Operating Trust other than compensation for service as a Trustee. In addition, employees of Xstrata Canada who also serve as Trustees on the Board do not receive any compensation in connection with their services as Trustees on the Board. In addition to the foregoing, the Board further encourages a culture of ethical conduct by appointing officers and engaging Trustees of only high integrity and by monitoring performance. The Board also establishes independent committees of the Board from time to time to address any specific issues or aspects of the Fund's business and operations to prevent any actual or perceived conflict of interest.

6. Nomination of Trustees

a) Describe the process by which the Board identifies new candidates for Board nomination:

The Board has adopted a policy regarding the selection and retention of Trustees. The Board has also developed a Skills Matrix for new candidates and works to ensure that any gaps in the Board's expertise are addressed by new nominees at the appropriate time. The Governance and Human Resources Committee typically works independently to assess potential independent candidates and makes recommendations to the Board. In the normal course of business, before making a recommendation on a new candidate as trustee, the Chair of the Board and/or the Governance and Human Resources Committee Chair meet with the candidate to discuss (among other things) the candidate's interest, expertise, industry experience, communication skills, integrity, track record and ability to devote the time and commitment required to serve on the Board. The Governance and Human Resources Committee makes arrangements to verify the candidate's educational background, conduct a background check on the candidate and assess any potential conflicts, independence concerns or disclosure issues the candidate might have. The Governance and Human Resources Committee typically works in conjunction with Xstrata Canada (who is generally entitled to nominate the Trustees under the Trust Indenture) to assess potential candidates and makes recommendations to the Board. The Governance and Human Resources Committee also considers recommendations for nominees submitted by Unitholders of the Fund, as and when required pursuant to the Trust Indenture or otherwise by applicable laws. From time to time, the Board and/or Governance and Human Resources Committee may also retain external firms to assist with identifying and recruiting possible nominee trustees for the Board of Trustees.

b) Disclose whether or not the Board has a nominating committee composed entirely of independent trustees. If the Board does not have a nominating committee composed entirely of independent trustees, describe what steps the Board takes to encourage an objective nomination process:

The Governance and Human Resources Committee is composed of four Trustees, all of whom are Independent Trustees. As needed, the Governance and Human Resources Committee may retain the services of an expert search company to identify independent candidates. The Chair of the Governance and Human Resources Committee works closely with the Chair of the Audit Committee, who in the normal course of business is an Independent Trustee. The Governance and Human Resources Committee is comprised of the following four Independent Trustees: Mr. Ouellet (Chair), Mr. Swidler, Mr. Tissenbaum and Mr. Roy.

c) If the Board has a nominating committee, describe the responsibilities, powers and operation of the nominating committee:

In the normal course of business, it is the responsibility of the Governance and Human Resources Committee to, among other things, annually assess the size and composition of the Board and its Committees, to review the effectiveness of the Board's operations and its relations with management, to review the Fund's statement of corporate governance practices and to review and recommend Trustees' compensation. In the normal course of business, the Governance and Human Resources Committee is also responsible for the Board's succession planning, reviewing the credentials of nominees for election or appointment to the Board, recommending candidates for Board membership and for interfacing with Xstrata Canada which, by the terms of the Trust Indenture, is generally entitled to propose the nominees for election as Trustees.

In the normal course of business, the Governance and Human Resources Committee also annually reviews the performance of the Board and its Committees and the individual contribution of Trustees through a self-survey and a peer feedback survey.

The Governance and Human Resources Committee met four times in 2012. At most Governance and Human Resources Committee meetings, the members hold meetings without the presence of management.

7. Compensation

a) Describe the process by which the Board determines the compensation for the issuer's trustees and officers:

On recommendation of the Governance and Human Resources Committee, the Board sets the compensation and benefits of the Trustees by seeking to ensure that the compensation and benefits reflect the responsibilities and risks involved in being a Trustee and align the interests of the Trustees with the best interests of the Fund and its Unitholders.

The Administrator operates and manages the Operating Trust and the Fund, including determining the compensation of senior management of the Administrator, in consultation with the Trustees. Each year, the Administrator (or Xstrata Canada) conducts a review of the compensation and remuneration policies applicable to its executive officers, including those who provide services in respect of the Fund, and reports to the Governance and Human Resources Committee on the results of that review as it applies to the annual compensation and performance reviews of the CEO and CFO. For further details, see also the sections entitled "Statement of Executive Compensation – Compensation Discussion and Analysis" and "Committees of the Board – The Governance and Human Resources Committee" above. The Governance and Human Resources Committee reviews the compensation policies of Xstrata Canada as they apply to the Fund.

Please see "Statement of Executive Compensation" and "Remuneration of Trustees" above for further details.

b) Disclose whether or not the Board has a compensation committee composed entirely of independent trustees. If the Board does not have a compensation committee composed entirely of independent trustees, describe what steps the Board takes to ensure an objective process for determining such compensation.

The Governance and Human Resources Committee, which is comprised entirely of Independent Trustees, is responsible for, among other things, reviewing and recommending Trustees' compensation. The Operating Trust does not have a separate compensation committee. Given that the Fund Administrator's senior management is governed by the Xstrata Canada compensation policies, the Governance and Human Resources Committee's responsibility is generally limited to the determination of Trustee compensation. The Governance and Human Resources Committee also reviews the compensation policies of Xstrata Canada as they apply to the Fund.

c) If the Board has a compensation committee, describe the responsibilities, powers and operation of the compensation committee:

Reference is made to part 7(b) above.

8. Other Board Committees – If the Board has standing committees other than the audit, compensation and nominating committees, identify the committees and describe their function.

The Independent Committee is comprised of John J. Swidler (Chair), Jean Pierre Ouellet, Barry Tissenbaum and François R. Roy (Vice-Chair). For further details concerning the functions and responsibilities of the Independent Committee, see the section of the Circular entitled "Committees of the Board – The Independent Committee" above.

9. Assessments – Disclose whether or not the Board, its committees and individual trustees are regularly assessed with respect to their effectiveness and contribution. If assessments are regularly conducted, describe the process used for assessments. If assessments are not regularly conducted, describe how the Board satisfies itself that the Board, its committees, and its individual trustees are performing effectively:

Board of Trustees:

In the normal course of business, a self-survey and a peer feedback survey of the Board as a whole and of its individual members are conducted, and the Chair of the Governance and Human Resources Committee reports to the Board on an annual basis, which then considers whether any changes to the Board's processes, policies, composition or Committees are necessary or desirable. The Chair meets separately with each member to discuss the results and make recommendations based on feedback. The Board Chair position description, as well as the Board Mandate, is also reviewed on an annual basis. A self-survey and peer review have been conducted to review the year 2012.

The peer feedback survey is based on guidelines prepared by the Canadian Coalition for Good Governance and provides a forum for each Trustee to report on the performance of his peers in such areas as, meeting preparation, contribution to Board discussions and decisions, financial literacy, application of knowledge, experience and expertise to issues confronting the Fund, judgement, ability to work cooperatively with others, accountability and compliance, ethical standards, availability and accessibility and overall contribution to the functioning of the Board. The self-survey covers various areas designed to assess, and address, any issues relating to the categories of Board responsibility, operations and functionality and Board effectiveness. In the ordinary course, the self- surveys are completed annually by each Trustee and provided to the Chair of the Governance and Human Resources Committee, who then reports to the Board on the results of such surveys. The peer surveys are usually completed annually and reported confidentially

to the Chair of the Governance and Human Resources Committee, who then addresses any issues or concerns directly with the applicable Trustee.

Audit Committee:

In the normal course of business, a self-assessment is conducted on the Audit Committee as a whole and of its individual members and the Chair of the Audit Committee reports to the Board and makes recommendations based on feedback on an annual basis. The Audit Committee Chair position description as well as the Audit Committee Mandate is reviewed on an annual basis. A self- assessment has been conducted to review the year 2012.

INDEBTEDNESS OF CERTAIN PERSONS

None of the current or former officers, directors or employees of the Administrator, or current or former officers, Trustees or employees of the Fund or the Operating Trust, or their respective associates, has any indebtedness towards the Fund or any of its subsidiaries.

INTERESTS OF INFORMED PERSONS IN MATERIAL TRANSACTIONS

Other than as disclosed in: (i) this Circular, (ii) the 2012 Annual Information Form (under the headings "Xstrata Canada Corporation – Major Agreements", "The Administrator and Manager" and "Material Contracts – Indebtedness"), (iii) the Management’s Discussion and Analysis for the fiscal year ended December 31st, 2012 (under the heading "Transactions with Related Parties"), and (iv) the notes to the Consolidated Financial Statements for the fiscal year ended December 31st, 2012 (under the headings "Supply and Processing Agreement", "Bank and Other Loans" and "Related Parties "), to the knowledge of the Fund, as of the date of this Circular, none of the Trustees, executive officers or former executive officers of the Fund or the Administrator and no person or company beneficially owning, or controlling or directing, directly or indirectly, Units carrying more than 10% of the voting rights attached to the Units nor any associates or affiliates of the foregoing, had any material interest, direct or indirect, in any transaction since the commencement of the Fund’s last financial year or in any proposed transaction which has materially affected or would materially affect the Fund or any of its affiliates.

AUDITOR OF THE FUND

Ernst & Young LLP have acted as auditors for the Fund since its inception.

OTHER BUSINESS

The Fund knows of no other matter to come before the Meeting other than those referred to in the Notice.

ADDITIONAL INFORMATION

Additional information relating to the Fund can be found on SEDAR at www.sedar.com. Unitholders may contact the Fund at 100 King Street West, First Canadian Place, Suite 6900, P.O. Box 403, Toronto, Ontario, M5X 1E3 by mail, by fax at 416-775-1490 or by telephone at 416- 775-1561 to request copies of the Fund's Audited Consolidated Financial Statements and MD&A. Each of the Administrator and Xstrata Canada may similarly be contacted by mail at 100 King Street West, First Canadian Place, Suite 6900, P.O. Box 403, Toronto, Ontario, M5X 1E3

Financial information for the Fund's most recently completed financial year is provided in its Comparative Consolidated Financial Statements and MD&A which are filed on SEDAR and available at www.sedar.com.

ADMINISTRATOR'S APPROVAL

The Administrator has approved the contents and the sending of this Circular.

BOARD OF TRUSTEES APPROVAL

The Board of Trustees of Noranda Operating Trust has approved the contents and the sending of this Circular. A copy of this Circular has been sent to each Trustee, each Unitholder entitled to notice of the Meeting and the auditors of the Fund.

DATED as of the 4th day of April, 2013.

BY ORDER OF CANADIAN ELECTROLYTIC ZINC LIMITED, THE ADMINISTRATOR OF THE FUND

Ginette Berthel Corporate Secretary

APPENDIX "A" - BOARD OF TRUSTEES MANDATE

NORANDA OPERATING TRUST

BOARD OF TRUSTEES

MANDATE ROLE OF BOARD

The role of the Board of Trustees (the "Board") of Noranda Operating Trust ("NOT") is to oversee, directly and through its committees, the business and affairs of NOT and Noranda Income Fund (the "Fund"), which are conducted by its management. In doing so, the Board acts at all times with a view to the best interests of the Fund and its unitholders.

The Board is elected indirectly by the unitholders of the Fund to ensure that the best interests of its unitholders are advanced by enhancing unitholders' value in a manner that recognizes the concerns of other stakeholders in the Fund, including its employees, suppliers, customers and the communities in which it operates.

AUTHORITY AND RESPONSIBILITIES

The Board meets regularly to review reports by management on the performance of the Fund. In addition to the general supervision of management, the Trustees perform the following functions:

strategic planning – overseeing the strategic planning process and reviewing, approving and monitoring the strategic plan including fundamental financial and business strategies and objectives;

risk assessment – assessing the major risks facing the Fund and reviewing, approving and monitoring the manner of managing those risks;

maintaining integrity – reviewing and monitoring the controls and procedures within the Fund to maintain its integrity including its disclosure controls and procedures, its internal controls and procedures for financial reporting and compliance with its code of ethics;

succession planning – ensuring that adequate and effective succession plans are in place for the CEO and senior management;

legal compliance – assessing, subject to a report from management, legal compliance in every jurisdiction where the Fund has interests;

decisions matrix – developing a decisions matrix requiring prior approval of the Board;

integrity of senior officers – developing the Board's expectation of management and to the extent feasible, satisfying itself as to the integrity of the chief executive officer ("CEO") and other senior officers and that the CEO and other senior officers create a culture of integrity throughout the organization;

communication policy – oversee the adoption of a communication policy for the Fund, including measures for receiving feedback from security holders;

corporate governance – develop and implement corporate governance principles and guidelines that are specifically applicable to the Fund; and

distributions – declare distributions to unitholders in conformity with the Trust Indenture.

COMPOSITION AND PROCEDURES

Size of the Board and nomination process – The Trustees are elected each year by the Sole trustee of the Fund, as directed by the unitholders of the Fund at the annual meeting. The Governance and Human Resources Committee proposes to the full Board the nominees for election to the Board and the Board proposes a slate of nominees to the unitholders of the Fund for election, the whole in accordance with the Trust Indenture. Any unitholder may propose a nominee for election to the Board by means of a unitholder proposal at the annual meeting. Between the annual meetings, the Board may appoint Trustees to serve until the next annual meeting.

Qualifications –Trustees should have the highest personal and professional ethics and values and be committed to advancing the best interests of the unitholders of the Fund. They should possess skills and competencies in areas that are relevant to the Fund's activities. A majority of Trustees shall be independent within the meaning of the corporate governance guidelines of the regulatory authorities. All Trustees must meet the qualification requirements provided for in the Trust Indenture.

Chair - The Trustees may appoint a Chair from amongst their number who shall not be an employee of the Trust and shall be an unrelated independent Trustee of the Trust. If the Chair of the Board is not present at any meeting of the Board of Trustees, the acting Chair of the meeting shall be chosen by the Board among the Trustees present.

Trustees' orientation – The President and Chief Executive Officer, the Chief Financial Officer and the Secretary are responsible for providing an orientation and education program for new Trustees.

Meetings – The Board has at least four scheduled meetings a year, once every quarter. The Board is responsible for its agenda. Prior to each Board meeting, the CEO will discuss agenda items for the meeting with the chairman of the Board. Materials for each meeting will be distributed to the Trustees in advance. The unrelated Trustees shall have at least four scheduled meetings a year without management present.

Committees – The Board has established the following permanent committees to assist the Board in discharging its responsibilities: the Audit Committee and the Governance and Human Resources Committee. Special committees may be established from time to time to assist the Board in connection with specific matters. The chairperson of each committee reports to the Board following meetings of the committee. The terms of reference of each committee are reviewed annually by the Board.

Evaluation – The Governance and Human Resources Committee performs an annual evaluation of the effectiveness of the Board, as a whole, and its committees and of the individual contributions of Trustees.

Compensation – The Governance and Human Resources Committee recommends to the Board the compensation and benefits for Trustees. In reviewing the adequacy and form of compensation and benefits, the committee seeks to ensure that the compensation and benefits reflect the responsibilities and risks involved in being a Trustee and align the interests of the Trustees with the best interests of the Fund and its unitholders.

Access to independent advisors – The Board and any of its committees may at any time retain outside financial, legal or other advisors at the expense of the Fund. Any Trustee may, subject to the approval of the Chairman of the Board, retain an outside advisor at the expense of the Fund.

Yearly review – The Board shall review its terms of reference on a yearly basis.

Confirmed on February 12th, 2013