MANAGEMENT’S DISCUSSION AND ANALYSIS This Management’s Discussion and Analysis (“MD&A”) of the consolidated financial position and results of operations of Noranda Income Fund (TSX: NIF.UN) is the responsibility of management and it has been prepared as at November 11, 2013. The board of trustees of Noranda Operating Trust carries out its responsibility by reviewing this disclosure principally through its audit committee and it approves this disclosure prior to its publication. This MD&A provides a review of the consolidated financial position, results of operations and performance of Noranda Income Fund (the “Fund”), the Noranda Operating Trust (the “Operating Trust”), 1884699 Ontario Inc. (“Ontario Inc.”), the Noranda Income Limited Partnership (the “Partnership”), Canadian Electrolytic Zinc Limited (the “Manager”) and the consolidated subsidiaries of the foregoing, including Canadian Electrolytic Zinc Limited (the “Manager”), for the third fiscal quarters ended September 30, 2013 and 2012. The Fund has prepared its unaudited Interim Condensed Consolidated Financial Statements for the third fiscal quarters ended September 30, 2013 and 2012 in accordance with International Accounting Standard 34, Interim Financial Reporting. All amounts are expressed in Canadian dollars, the Fund’s reporting and functional currency, except where indicated. Additional information relating to the Fund, including the Fund’s Annual Information Form is available on SEDAR at www.sedar.com. This MD&A contains forward-looking information and forward-looking statements within the meaning of applicable securities laws. See “Forward-Looking Information” below. RESULTS OF OPERATIONS Q3 2013 Highlights: • Earnings before income taxes were $13.9 million (Q3 2012 – $8.7 million) • Zinc metal production was 61,331 tonnes (Q3 2012 – 60,615 tonnes) • Zinc metal sales were 66,420 tonnes (Q3 2012 – 60,953 tonnes) • Zinc premiums averaged 8.4 cents US per pound (Q3 2012 – 7.6 cents US per pound) • Sulphuric acid netback remained strong at US$73 per tonne (Q3 2012 – US$79 per tonne) • Monthly cash distributions from July to October 2013 were $0.04167 per priority unit (each a “Priority Unit”); continuing the consistent monthly distributions since they were resumed in September 2011 • The Fund’s debt was $58.4 million (net of deferred financing fees), down from $95.5 million at the end of December 2012 Long-Term Strategy The Board is charged with evaluating the Fund’s long-term strategy, and with evaluating and supervising the formulation and execution of the Fund’s business and operating plans, which the 1

Manager, a wholly-owned subsidiary of Glencore Canada Corporation (“Glencore Canada”), prepares. Glencore Canada is a subsidiary of Glencore Xstrata plc (“Glencore Xstrata”). In May 2013, Glencore International plc completed its merger with Xstrata plc and changed its name to Glencore Xstrata. The main issue facing the Fund is the continued source of zinc concentrate to keep the Fund’s electrolytic zinc processing facility in Salaberry-de-Valleyfield, Québec (the “Processing Facility”) running at full or close to full capacity after the expiry of the supply and processing agreement between the Partnership and Glencore Canada (the “Supply and Processing Agreement”) in May 2017 in the event that the agreement is not renewed. The Supply and Processing Agreement will be automatically renewed for successive periods of five years unless Glencore Canada provides the Partnership with written notice to the contrary at least 180 days prior to the expiry of the applicable term (by November 2016). In order to prepare for the potential non-renewal of the Supply and Processing Agreement by Glencore Canada and given the uncertainty regarding zinc concentrate supply, 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, to determine 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. In 2012, the Board, through its Independent Committee, felt it would be prudent to identify possible alternative sources of zinc concentrate after the expiry of the Supply and Processing Agreement, knowing that the Partnership may be required to commit funds to ensure its continued supply. For this purpose, the 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. There can be no assurance that alternative sources of zinc concentrate will be available or, if available, would be available in sufficient quantities and qualities to run the plant at full or close to full capacity and on terms and conditions, including pricing, that will allow the Processing Facility to continue to operate profitably. If zinc concentrate was available, the Fund’s financial results could differ materially from the results achieved with the benefit of the Supply and Processing Agreement, which provides stable prices that are currently above market. For example, for the nine month period ended September 30, 2013, based on an estimated market

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processing fee of $0.2961 per pound and market payable metal in concentrate of 85% (compared to an actual processing fee of $0.395 per pound and payable metal of 96% under the Supply and Processing Agreement), the Fund’s “Adjusted EBITDA” would have been approximately $35 million compared to an Adjusted EBITDA of $77.7 million realized by the Fund with the benefit of the Supply and Processing Agreement. See “Key Performance Drivers - Adjusted Earnings before Distributions to Unitholders, Finance Costs, Income Taxes, Depreciation and Amortization” for more information on how the Fund calculates Adjusted EBITDA. In 2012, there was the commitment to increase the 2013 capital investment program, enabling the Processing Facility to treat a more varied feed quality mix. Going forward, the Processing Facility is expected to be required to treat a more varied feed quality mix with higher levels of impurities. In order to treat a more varied feeds, it was necessary to increase the Processing Facility’s silica removal capacity. Approximately $20 million is currently being invested in 2013 and in the first half of 2014 to treat such concentrate. This topic is discussed in greater detail in the section entitled “Zinc Metal Production – The Processing Facility Transitions to a New Feed Mix”. Cash Distributions In 2013, the Board approved monthly cash distributions of $0.04167 per Priority Unit in each of the first ten months of the year. When not restricted, the Fund's policy is to make a sustainable level of distributions to Unitholders. In determining whether there is a distribution and the level thereof, the Board of Trustees reviews periodically the Fund's financial performance, business environment and prospects. There is no assurance that monthly distributions will continue in the future; nor is there any assurance that, if they do continue, the level or frequency of such monthly distributions will not vary from the level of the most recent monthly cash distribution. The Fund’s distribution policy and practices are impacted by various risks, uncertainties and other factors, which are discussed in greater detail in this section and in the sections entitled “Distribution Policy”, “Liquidity and Capital Resources” and “Forward-Looking Information” below. Consolidated Earnings Attributable to Unitholders (Third quarter 2013 compared to third quarter 2012) Revenues less raw material purchase costs (“Net Revenues”) in the third quarter of 2013 were $76.5 million, compared to $57.7 million in the same quarter of 2012. The $18.8 million increase in the quarter was mainly due to stronger premiums and zinc metal sales, higher processing fee and the impact from derivative financial instrument (gain) loss, partially offset by negative concentrate payable settlement adjustments (see the table below for details on the concentrate adjustment and the impact of the exchange rate movement).

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Market terms and assumptions used for this calculation: Zinc price US$0.867; Cdn/US exchange rate 1.024; Benchmark treatment charges US $215 per dmt of concentrate; Market payable metal in concentrate 85%; Zinc metal sales 204,559 tonnes; Zinc metal recovery 97.3%

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In the third quarter of 2013, the provisional pricing feature in the Supply and Processing Agreement negatively impacted Net Revenues by $0.2 million. In the third quarter of 2012, the provisional pricing feature in the Supply and Processing Agreement negatively impacted Net Revenues by $5.4 million. The table below shows the 2013 and 2012 quarterly impact of the concentrate payable settlement adjustment and the foreign exchange movement on Net Revenues. Impacts of Concentrate Settlement Adjustments and Foreign Exchange on Net Revenues ($ million) Net Revenues Concentrate payable settlement adjustments Foreign exchange gain Net Revenues, excluding the impacts from concentrate payable settlement adjustments and foreign exchange

Production Cost Breakdown ($ millions) Labour Energy Operating supplies Other Production cost before change in inventory Change in inventory

Q3 2013 $14.4 14.1 9.9 5.2 43.6 3.0 $46.6

Q3 2013

Q3 2012

$76.5 0.2 2.0

$57.7 5.4 2.5

$78.7

$65.6

Increase/ Q3 2012 (Decrease) $13.8 $0.6 14.4 (0.3) 9.5 0.4 2.5 2.7 40.2 3.4 (1.4) 4.4 $38.8 $7.8

The production cost before changes in inventory in the third quarter of 2013 was $43.6 million, $3.4 million higher than the $40.2 million recorded in the third quarter of 2012. The increase in the third quarter of 2013 was mostly due to maintenance activity that resulted from operating issues in the roaster section of the plant. To address the operating issues, the Processing Facility installed a temporary concentrate crushing and screening process in front of the roasters. Selling and administration costs in the third quarter of 2013 were $4.4 million, compared to $4.7 million in the same period of 2012. The foreign exchange gain for the third quarter of 2013 was $2.0 million, compared to a gain of $2.5 million in the third quarter of 2012. The foreign exchange gain in the third quarter of 2013 was primarily a result of the impact of the strengthening Canadian dollar from June 30, 2013 to September 30, 2013 on the Fund’s net US monetary liabilities. The foreign exchange gain recognized in 2013 was largely offset by an increase in the value of in-process and finished inventory. The increase in the value of inventory is realized in Net Revenues as the metal is sold to customers (thereby decreasing the Net Revenue recorded by the Fund). The Fund’s main US 4

denominated balances are comprised of cash, accounts receivable, accounts payable and a portion of its debt. In the third quarter of 2013, the loss on derivative financial instruments was $3.3 million compared to a gain of $1.9 million in the third quarter of 2012. During the period, the change in the market value of the Fund's financial instruments resulted in these amounts being recorded. In the third quarter of 2013, depreciation was $9.4 million, compared to the $7.9 million that was recorded in the third quarter of 2012. The higher depreciation in 2013 was due to the reduction in the estimated useful life of anodes to 3 years from 3.5 years and from the higher zinc metal sales in the third quarter of 2013. Rehabilitation recovery for the third quarter of 2013 was $0.7 million compared to a rehabilitation expense of $0.2 million for the third quarter of 2012. The recovery in 2013 was due to the increase in the risk-free interest rate used to discount the liabilities, resulting in a decrease in the liabilities. In the third quarter of 2013, the net finance cost was $1.4 million compared to $1.8 million in the third quarter of 2012 due to lower bank and other loans outstanding. Current and deferred tax expense was $3.1 million in the third quarter of 2013 compared to $2.7 million expense in the third quarter of 2012. Prior to the Fund’s reorganization in December 2012, the Fund was required to record tax expense using the “undistributed” rate for both its current and deferred taxes, being the highest marginal personal tax rate of approximately 48%. Upon the distribution of taxable income, the income tax provision is adjusted on the distribution to a tax rate of 26.9%. In the third quarter of 2012, the impact of this adjustment was $1.4 million. Consolidated Earnings Attributable to Unitholders (First nine months of 2013 compared to the first nine months of 2012) Net Revenues in the first nine months of 2013 were $242.3 million, compared to $204.9 million in the same period of 2012. The $37.4 million increase in the first nine months of 2013 was mainly due to stronger premiums and zinc metal sales, higher processing fee, positive concentrate payable settlement adjustments and the impact from movement in the exchange rate, partially offset by lower by-product revenues (see the table below for details on the concentrate adjustment and the impact of the exchange rate movement). In the first nine months of 2013, the provisional pricing feature in the Supply and Processing Agreement positively impacted Net Revenues by $1.0 million. In the first nine months of 2012, the provisional pricing feature in the Supply and Processing Agreement negatively impacted Net Revenues by $10.3 million. The table below shows the 2013 and 2012 nine months year impact of the concentrate payable settlement adjustment and the foreign exchange movement on Net Revenues.

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Impacts of Concentrate Settlement Adjustments and Foreign Exchange on Net Revenues ($ million) Net Revenues Concentrate payable settlement adjustments Foreign exchange (loss) gain Net Revenues, excluding the impacts from concentrate payable settlement adjustments and foreign exchange

Production Cost Breakdown ($ millions) Labour Energy Operating supplies Other Production cost before change in inventory Change in inventory

YTD 2013 $45.8 44.7 29.8 13.3 133.6 3.3 $136.9

YTD 2013

YTD 2012

$242.3 (1.0) (5.1)

$204.9 10.3 2.1

$236.2

$217.3

YTD 2012 $44.0 44.2 28.6 9.6 126.4 0.3 $126.7

Increase $1.8 0.5 1.2 3.7 7.2 3.0 $10.2

Production costs before changes in inventory in the first nine months of 2013 were $133.6 million, $7.2 million higher than the $126.4 million recorded in the first nine months of 2012. The increase in costs was mostly due to higher zinc metal production and maintenance activity that resulted from operating issues in the roaster section of the plant. Selling and administration costs in the first nine months of 2013 were $15.3 million, compared to $15.8 million in the same period of 2012. The foreign exchange loss for the first nine months of 2013 was $5.1 million, compared to a gain of $2.1 million in the first nine months of 2012. The foreign exchange loss in 2013 was primarily a result of the impact of the weakening Canadian dollar on the Fund’s net US monetary liabilities. The foreign exchange loss was largely offset by an increase in the value of in-process and finished inventory. The increase in the value of inventory is realized in Net Revenues as the metal is sold to customers (thereby increasing the Net Revenue recorded by the Fund). The Fund’s main US denominated balances are comprised of cash, accounts receivable, accounts payable and a portion of its debt. In the first nine months of 2013, the gain on derivative financial instruments was $0.1 million compared to a gain of $2.6 million in the first nine months of 2012. During the periods, the change in the market value of the Fund's financial instruments resulted in these amounts being recorded. In the first nine months of 2013, depreciation was $27.6 million, compared to the $24.4 million that was recorded in the first nine months of 2012. The higher depreciation in 2013 was due to the reduction in the estimated useful life of the anodes to 3 years from 3.5 years and the higher zinc metal sales in 2013. 6

Rehabilitation recovery for the first nine months of 2013 was $3.2 million compared to a rehabilitation expense of $0.7 million for the first nine months of 2012. The recovery in 2013 was due to the increase in the risk-free interest rate used to discount the liabilities, resulting in a decrease in the liabilities. The expense in 2012 was due to the decrease in the risk-free rate used to discount the liabilities, resulting in an increase in the liabilities. In the first nine months of 2013, the net finance cost was $5.0 million compared to $6.0 million in the first nine months of 2012. Current and deferred tax expense was $11.7 million in the first nine months of 2013 compared to $12.7 million for the first nine months of 2012. Prior to the Fund’s reorganization in December 2012, the Fund was required to record tax expense using the “undistributed” rate for both its current and deferred taxes, being the highest marginal personal tax rate of approximately 48%. Upon the distribution of taxable income, the income tax provision was adjusted on the distribution to a tax rate of 26.9%. In the first nine months of 2012, the impact of this adjustment was $4.1 million.

SUMMARY OF QUARTERLY RESULTS The following table provides a summary of quarterly results for the past eight quarters: ($ millions, except production amounts) 2013 2013 2013 2012 2012 2012 2012 2011 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 $ 148.5 $ 162.5 $ 150.1 $ 150.7 $ 128.6 $ 152.6 $ 145.8 $ 137.8

Revenues Increase (decrease) in net assets attributable to Unitholders $ 5.9 Production (tonnes) 61,331

$ 6.1 68,286

$ 17.3 68,413

$ 22.2 74,748

$ 2.3 60,615

$ 3.5 $ 6.5 $ (13.5) 65,521 62,813 67,504

* 1 tonne = 2,204.62 pounds

KEY PERFORMANCE DRIVERS The Fund provides annual guidance for a number of its key performance drivers, including production, sales, processing fee and capital expenditures. Guidance for 2013 key drivers can be found in “Outlook” below. The following table provides a summary of the performance of the key drivers for the quarters and nine months ended September 30, 2013 and 2012 respectively. The discussion of key performance drivers that follows is subject to various risks and uncertainties, some of which are discussed under “Forward-Looking Information” below, which investors are encouraged to read carefully.

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Zinc concentrate processed (tonnes) Zinc grade (%) Zinc recovery (%) Zinc metal production (tonnes) Zinc metal sales (tonnes) Processing fee (cents/pound) Zinc metal premium (US$/pound) By-product revenues ($ millions) Copper in cake production (tonnes) Copper in cake sales (tonnes) Sulphuric acid production (tonnes) Sulphuric acid sales (tonnes) Average LME copper price (US$/pound) Sulphuric acid netback (US$/tonne) Average LME zinc price (US$/pound) Average Cdn/US exchange rate

Third Quarter 2013 2012 122,216 120,899 53.2 54.5 97.3 97.1 61,331 60,615 66,420 60,953 39.5 39.2 0.084 0.076 9.2 9.2 330 584 373 307 97,700 100,259 97,964 95,344 3.21 3.50 73 79 0.84 0.86 1.038 0.995

Year-To-Date 2013 2012 379,907 372,887 53.2 54.2 97.3 96.6 198,030 188,949 204,559 192,890 39.5 39.2 0.084 0.075 29.8 31.0 1,330 1,736 1,599 1,541 306,761 308,965 305,269 312,939 3.35 3.61 72 74 0.87 0.88 1.024 1.002

* 1 tonne = 2,204.62 pounds

Zinc Metal Production The amount of zinc metal produced in a reporting period is a function of four main factors: (1) the volume of zinc concentrate processed; (2) the grade of the zinc concentrate processed; (3) the zinc recoveries; and (4) changes to the level of work-in-process inventory levels. In the third quarter of 2013, the Fund consumed concentrate from the Bracemac-McLeod, Kidd Creek, Perseverance, Brunswick, Mount Isa and Langlois mines. In the most recent quarter, 122,216 tonnes of zinc concentrate with a zinc grade of 53.2% were processed compared to 120,899 tonnes with a zinc grade of 54.5% in the third quarter of 2012. Zinc recoveries in the third quarter of 2013 were 97.3% compared to 97.1% in the same quarter of 2012. Production in the third quarter of 2013 was 61,331 tonnes compared to 60,615 tonnes in the same period of 2012. Production was higher than the same period a year ago due to higher volumes of zinc concentrate processed and higher zinc recoveries partially offset by lower zinc grade in the concentrate. Third quarter 2013 production was negatively impacted by operating issues in the roaster section of the plant. Third quarter 2012 production was negatively impacted by a slower start-up in the cell house after the second quarter maintenance shutdown. Production in the first nine months of 2013 was 198,030 tonnes compared to 188,949 tonnes in the same period of 2012. Production was higher in the first nine months of 2013 than the same period a year ago because of a drawdown of in-process inventories, a higher volume of zinc 8

concentrate being processed and higher recoveries, partially offset by lower zinc grade in the concentrate. In addition, work-in-progress inventory was increased during the same period of 2012. The Processing Facility has a planned maintenance outage in the fourth quarter of 2013 that is expected to reduce production. The target for 2013 annual production remains at 265,000 tonnes. The Fund pays for 96% of the zinc in the concentrate it purchases; therefore, any recovery over 96% results in additional revenue and earnings for the Fund. The Processing Facility Transitions to a New Feed Mix In April 2013, Glencore Xstrata’s Brunswick Mine closed. It had been a major supplier to the Processing Facility for most of the fifty years that the Processing Facility has operated. With the closure of Brunswick Mine, the future feed mix to the Processing Facility is expected to contain an increased level of impurities. While future feeds are expected to remain within the specifications set out in the Supply and Processing Agreement, the Processing Facility may experience an increase in its operating costs, working capital requirements and/or capital expenditures as a result of being required to treat a more varied feed quality stream. Higher amounts of impurities may also negatively impact the volume of zinc concentrate that can be processed, resulting in a lower overall production. Going forward, inventory levels are expected to be more variable, as larger and more irregular seaborne deliveries of concentrate will replace some of the regular rail deliveries from Ontario, Québec and New Brunswick. In addition, as a result of the expected feed changes noted above, the Processing Facility received increased deliveries of zinc concentrate in the fourth quarter of 2012, including concentrates with a higher silica content. This concentrate was used to blend with the historical concentrate mix, ensuring a gradual transition. The Fund expects to carry higher than normal concentrate inventories through to 2014, when the silica removal project is expected to be completed. Going forward, the ability of the Processing Facility to treat a wide variety of zinc concentrate feeds is required so that it can continue to operate at full or close to full capacity. In December 2012, the Fund announced that it was making a capital investment of $20 million in 2013 to increase the Processing Facility’s capability for removing silica, an impurity commonly found in zinc concentrate. The bulk of the investment is expected to occur in 2013 and the project is scheduled to be completed by June 2014. Liner Replacement Project In 2010, the Processing Facility began a $17.4 million project to replace the liners protecting the concrete walls in the cell house. The project remains on budget and is expected to be completed by the first quarter of 2014.

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The targets for annual zinc metal production and the timing of the completion of the replacement of the cell house liners, and future expected annual production capacity, operating costs, level of working capital, capital expenditures, the level of impurities in the concentrate and the level of the zinc concentrate inventory are subject to various risks and uncertainties, some of which are set out under “Forward-Looking Information” below. Sales Zinc metal is used in a wide range of industries. Its major use is in the production of galvanized steel. Zinc demand was steady during the third quarter. Customers are maintaining a cautious outlook with low purchase inventories heading into the final quarter of the year. Sales in the third quarter of 2013 were 66,420 tonnes compared to 60,953 tonnes in the third quarter of 2012. During the third quarter of 2013, sales were higher than production and metal inventories were reduced by approximately 5,000 tonnes. Sales in the first nine months of 2013 were 204,559 tonnes compared to 192,890 tonnes in the same period of 2012. Sales were higher in the first nine months of 2013 than the same period a year ago because of improved production and a pickup in demand. The target for 2013 annual sales remains at 265,000 tonnes, matching the annual production target. The target for annual zinc metal sales is subject to various risks and uncertainties, some of which are set out under “Forward-Looking Information” below. Processing Fee In the first nine months of 2013, the processing fee was $0.395 per pound ($871 per tonne), compared to $0.392 per pound ($864 per tonne) in 2012. The processing fee is adjusted annually: (i) upward by 1% and (ii) upward or downward by 10% of the year-over-year percentage change in the average cost of electricity per megawatt hour for the Processing Facility. Premiums In the third quarter of 2013, premiums averaged 8.4 cents US per pound, compared to 7.6 cents US per pound in the third quarter a year ago. The increase in realized premiums compared to last year reflected the impact of improved annual contract and spot premiums in North America. By-products The Fund produces copper in cake and sulphuric acid as by-products from the refining of zinc concentrate. In the third quarters of 2013 and 2012, the Fund generated $9.2 million in revenue from the sale of its copper in cake and sulphuric acid. The by-product revenue generated in the first nine months of 2013 totalled $29.8 million compared to $31.0 million in the first nine months of 2012.

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Copper in Cake Copper in cake revenue in the third quarter of 2013 was $1.8 million compared to $1.6 million in the same period of 2012. Copper in cake sales volumes in the third quarter of 2013 totalled 373 tonnes, compared to 307 tonnes in the third quarter of 2012. In the third quarter of 2013, the Fund’s copper in cake production totalled 330 tonnes compared to 584 tonnes in the same quarter a year ago. The volume of copper produced is dependent on the copper content in the zinc concentrates that are consumed during the quarter. Copper in cake revenue in the first nine months of 2013 was $7.2 million compared to $7.7 million in the same period of 2012. Copper in cake sales volumes in the first nine months of 2013 totalled 1,599 tonnes, compared to 1,541 tonnes in the first nine months of 2012. In the first nine months of 2013, the Fund’s copper in cake production totalled 1,330 tonnes compared to 1,736 tonnes in the same period a year ago. Production and sales volumes in the first half of 2012 benefitted from the spot sales of 343 tonnes of lower-value material that had built up over the last two years. In the third quarter of 2013, copper prices averaged US$3.21 per pound, compared to US$3.50 per pound in the third quarter of 2012. The copper price for the first nine months of 2013 averaged US$3.35 per pound compared to US$3.61 for the same period in 2012. Sulphuric Acid Revenue from the sale of sulphuric acid in the third quarter and first nine months of 2013 was $7.4 million and $22.6 million compared to $7.5 million and $23.3 million in the same periods of 2012. Sulphuric acid netbacks in 2013 continued at a level similar to the previous year, with realizations of US$73 per tonne for the quarter and US$72 per tonne for the first nine months, compared to US$79 per tonne and US$74 per tonne, respectively in the same periods of 2012. In the third quarter of 2013, sulphuric acid production totalled 97,700 tonnes compared to 100,259 tonnes in the same quarter a year ago. Sales volumes for the quarter were 97,964 tonnes compared to 95,344 tonnes in the same quarter a year ago. In the first nine months of 2013, sulphuric acid production totalled 306,761 tonnes compared to 308,965 tonnes in the first nine months of 2012, while first nine months 2013 sales totalled 305,269 tonnes compared to 312,939 tonnes in the first nine months of 2012. The combination of strengthening North American acid demand and reductions in supply resulted in a relatively balanced market during the third quarter of 2013. Market fundamentals should remain stable during the current quarter, with normal seasonal fluctuations leaving the market balanced to slightly long. Exchange Rate A weaker Canadian dollar has a positive impact on the Fund’s operating results. In the third quarter of 2013, a one-cent Canadian dollar weakening would have positively impacted the 11

Fund’s annual cash flow from operations before working capital changes by approximately $0.8 million. In the third quarter of 2013, the Canadian dollar averaged $1.038 per US dollar compared to $0.995 per US dollar in the same period a year ago. Costs Production costs include labour, energy, supplies and other costs directly associated with the production process, plus or minus changes in inventory levels. Production cost before changes in inventory in the third quarter of 2013 was $43.6 million, $3.4 million higher than the $40.2 million recorded in the third quarter of 2012. Production costs before changes in inventory in the first nine months of 2013 were $133.6 million, $7.2 million higher than the $126.4 million recorded in the first nine months of 2012. For both the quarter and nine month periods, the increase in costs was mostly due to higher zinc metal production and maintenance activity that resulted from operating issues in the roaster section of the plant. Capital Expenditures Capital spending in the third quarter and the first nine months of 2013 was $7.9 million and $19.0 million, compared to $7.1 million and $18.0 million in the same periods a year ago. The 2013 capital expenditure forecast has been reduced to $40.4 million from $46 million as some of the work and expenditures associated with the silica removal project has shifted to the first quarter of 2014. During the first nine months of 2013, $6.0 million was spent on the silica removal project, $1.3 million on the cell house rehabilitation project, $5.6 million on replacement anodes in the cell house and the balance on sustaining capital. In line with the budget, the bulk of the spending on the silica removal project is expected to occur during the fourth quarter. The target for capital expenditures is subject to various risks and uncertainties, some of which are set out under “Forward-Looking Information” below. Adjusted Earnings before Distributions to Unitholders, Finance Costs, Income Taxes, Depreciation and Amortization (“Adjusted EBITDA”) Adjusted EBITDA is used by the Fund as an indication of cash generated from operations. Adjusted EBITDA is not a recognized measure under International Financial Reporting Standards (“IFRS”) and therefore the Fund’s method of calculating Adjusted EBITDA is unlikely to be comparable to methods used by other entities. The Fund’s Adjusted EBITDA is calculated by starting from earnings before finance costs and income taxes and adjusting for all of the non-cash items such as depreciation, (gain) loss on the sale of assets, changes in fair value of embedded derivatives and non-cash gain on derivative financial instruments. In addition, an adjustment is made to reflect the net change in the rehabilitation liability (reclamation (recovery) expense less site restoration expenditures) and the net change in employee benefits (non-cash employee benefit expenses less employer contributions).

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A reconciliation of Adjusted EBITDA that compares the third quarter and first nine months of 2013 to the same periods in 2012 can be found in the table below: Adjusted EBITDA ($ thousands) Earnings before finance costs and income taxes

Q3/2013 $ 15,351

Q3/2012 $

Depreciation of property, plant and equipment Net change in rehabilitation liability Loss (gain) on derivative financial instruments Change in fair value of embedded derivatives (Gain) loss on sale of assets Net change in employee benefits

9,433 (791) 484 223 41 (253) $ 24,488 $

Adjusted EBITDA ($ thousands) Earnings before finance costs and income taxes

YTD/2013

Depreciation of property, plant and equipment Net change in rehabilitation liability Gain on derivative financial instruments Change in fair value of embedded derivatives Gain on sale of assets Net change in employee benefits

27,566 (3,530) (4,926) (1,006) (521) (585) $ 77,679 $

$ 60,681

10,572

Change $

7,905 164 (1,073) 5,402 (420) (485) 22,065 $ YTD/2012

$

41,932

4,779 1,528 (955) 1,557 (5,179) 461 232 2,423 Change

$

18,749

24,440 3,126 466 (3,996) (2,200) (2,726) 10,263 (11,269) (112) (409) (1,164) 579 73,625 $ 4,054

The Fund’s Adjusted EBITDA is currently supported by the pricing under the Supply and Processing Agreement. It is expected that the Fund’s Adjusted EBITDA will be more sensitive to market prices after May 2017, whether the agreement is renewed or not. See “Results of Operations - Long Term Strategy” for more information on the impact of the termination of the Supply and Processing Agreement. OPERATING CASH FLOWS Cash provided by operating activities in the third quarter of 2013, before net changes in non-cash working capital items, was $15.8 million compared to $15.1 million during the same period of 2012. Cash distributions of $4.7 million were declared in both the 2013 and 2012 quarterly periods. During the third quarter of 2013, non-cash working capital decreased by $10.1 million due to a decrease in accounts receivable and inventories and an increase in accounts payable and

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accrued liabilities. During the third quarter of 2012, non-cash working capital decreased by $14.2 million due to an increase in accounts payable and accrued liabilities. Cash provided by operating activities in the first nine months of 2013, before net changes in noncash working capital items, was $48.5 million compared to $47.2 million during the same period of 2012. Cash distributions of $14.1 million were declared in both the first nine months of both years. During the first nine months of 2013, non-cash working capital decreased by $21.0 million due to a decrease in inventories and accounts receivable, partially offset by a decrease in accrued liabilities. During the first nine months of 2012, non-cash working capital increased by $2.8 million due to a decrease in income taxes payable and an increase in inventories, partially offset by an increase in accounts payable and accrued liabilities and a decrease in accounts receivable.

DISTRIBUTION POLICY Distribution Policy When not restricted and when possible, and as may be considered appropriate by the Board, the Fund’s policy is to make distributions at sustainable levels to Unitholders equal to distributable cash flows from operations (as discussed below). The Fund determines the cash available for distribution, if any, on a monthly basis for the Unitholders of record of the Fund on the last business day of each calendar month and these distributions are to be paid on or about 25 days thereafter. In 2013, the Board has approved monthly cash distributions of $0.04167 per Priority Unit in the first ten months of the year. Pursuant to the Fund’s Partnership Agreement, cash distributions on the Ordinary Units of the Partnership held indirectly by Glencore Canada are subordinated to distributions on Priority Units of the Fund until May 2017, except upon the occurrence of certain events. In the event of an exchange of Ordinary Units on a one-for-one basis for Priority Units on or after May 2, 2017, or earlier upon the occurrence of an early exchange event, any accumulated deficiency amount related to the Ordinary Units prior to the exchange is not accrued by the Fund until such time that excess cash is available for distribution above the monthly cash distribution of $0.08333 per Priority Unit, and a cash distribution is approved by the Board. Upon the exchange, the holder of Ordinary Units has the right to receive any distribution declared but not paid on the Ordinary Units as at that time and a promissory note in the amount of the outstanding accumulated deficiency amount. Subsequent to an exchange, there is no further accumulation of the deficiency amount. As a result of Glencore Canada’s subordination, no distributions have been declared to the Ordinary Units since January 2009. The accumulated distribution deficiency amount was $15.5 million as at September 30, 2013 and $16.0 million as at November 11, 2013. For further details on the terms of the subordination, reference should be made to the Fund’s Partnership Agreement dated May 1, 2002, which is available on SEDAR at www.sedar.com. There is no assurance that monthly distributions will continue in the future; nor is there any assurance that, if they do continue, the level or frequency of such distributions will not vary from 14

the level of the most recent monthly cash distribution. The Fund, as a specified investment flow-through (“SIFT”), is subject to tax on its “non-portfolio earnings” (as defined in the Income Tax Act (Canada) (the “ITA”)) (the “NPE”) at the same rate as a Canadian corporation provided it distributes a sufficient portion of such earnings to Unitholders. The Fund’s distribution policy and practices are impacted by various risks, uncertainties and other factors, which are discussed in greater detail in this section and in the sections entitled “Liquidity and Capital Resources” and “Forward-Looking Information” below. Cash Available for Distribution The Fund’s objective is to maximize unitholder value and, when possible, make a sustainable level of distributions to Unitholders. “Cash available for distribution” is used by the Fund as an indication of cash generated from operations that is available for distribution to Unitholders. Cash available for distribution is not a recognized measure under IFRS and therefore the Fund’s method of calculating cash available for distribution is unlikely to be comparable to methods used by other entities. Cash available for distribution is calculated by taking cash provided by (used in) operating activities before distributions to Unitholders and changes in non-cash working capital, and by subtracting purchases of equipment, debt financing cost and permanent debt repayments, cash provided by the Manager’s operating activities and amounts retained for reserves. Cash available for distribution per Priority Unit and Ordinary Unit is calculated as cash available for distribution divided by the number of Priority and Ordinary Units outstanding, respectively at the end of the year. Reserves reflect amounts that may be required to pay for potential closure costs at the Processing Facility and other amounts as considered necessary by the Board. The closure costs include estimated severance payments, pension and retirement benefit plans and site rehabilitation costs. Should these assumptions need to be modified due to changing circumstances, the amount of the necessary reserves may increase or decrease, with a corresponding effect on cash available for distribution. The Fund is also subject to the Operating Trust maintaining a minimum excess availability of cash per the asset-based revolving credit facility (the “ABL Facility”) and other customary restrictions pursuant to the terms of both its ABL Facility and the senior secured notes (“the Notes”) (as discussed below under “Liquidity and Capital Resources”). A reconciliation of cash provided by operations to cash available for distribution for the third quarter and for the first nine months of 2013 compared to the same periods in 2012 is provided below:

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($ thousands) Cash provided by operating activities Capital adjustments: Purchase of property, plant and equipment, net Total capital adjustments Other adjustments: Distributions declared on Priority Units Decrease in non-cash working capital Elimination of the Manager's cash provided by operating activities Total other adjustments Cash available for distribution before reserve Increase in reserve Cash available for distribution

Q3/2013 $25,970

Q3/2012 $29,278

(7,935) (7,935)

(7,110) (7,110)

4,688 (10,133) (55) (5,500)

4,688 (14,194) (48) (9,554)

12,535

12,614

($7,847)

($7,926)

$4,688

$4,688

Weighted average number of Priority Units outstanding (basic and diluted) Cash available for distribution per Priority Unit Distributions declared per Priority Unit Weighted average number of Ordinary Units outstanding (basic and diluted) Distributions declared per Ordinary Unit

37,497,975 37,497,975 $0.12501 $0.12501 $0.12501 $0.12501 12,500,000 12,500,000 $ - $ -

($ thousands) Cash provided by operating activities Capital adjustments: Purchase of property, plant and equipment, net Total capital adjustments Other adjustments: Distributions declared on Priority Units Scheduled debt repayment (Decrease) increase in non-cash working capital Elimination of the Manager's cash provided by operating activities Total other adjustments

YTD 2013 YTD 2012 $69,524 $44,351

Cash available for distribution before reserve Increase in reserve Cash available for distribution Weighted average number of Priority Units outstanding (basic and diluted) Cash available for distribution per Priority Unit Distributions declared per Priority Unit Weighted average number of Ordinary Units outstanding (basic and diluted) Distributions declared per Ordinary Unit

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(18,760) (18,760)

(18,041) (18,041)

14,063 (7,500) (20,988) (158) (14,583)

14,063 (7,500) 2,847 (148) 9,262

36,181

35,572

($22,118)

($21,509)

$14,063

$14,063

37,497,975 37,497,975 $0.37503 $0.37503 $0.37503 $0.37503 12,500,000 12,500,000 $ - $ -

LIQUIDITY AND CAPITAL RESOURCES As at September 30, 2013, the Fund’s debt was $58.4 million (net of deferred financing fees), down from $95.5 million at the end of December 2012, as a result of the strong cash flow from operations and the reduction in non-cash working capital. The Fund’s cash and cash equivalents as at September 30, 2013 increased to $15.2 million, compared to $1.3 million as at December 31, 2012. It is expected that the cash and cash equivalents will be used in the fourth quarter of 2013 for the expected capital expenditures and the upcoming Note repayment in December 2013. Senior Secured Notes As at September 30, 2013, the Operating Trust had $60.0 million of Notes outstanding. Prior to December 28, 2016, the Notes are being amortized by an amount of $7.5 million on a semiannual basis on June 28 and December 28 of each year. The $15 million remaining principal balance will be repayable at maturity on December 28, 2016. Under the Notes’ governing trust indenture, the Fund is permitted to distribute excess cash flows to its Unitholders subject to compliance with certain financial covenants and other customary restrictions. The Notes’ trust indenture lists events that constitute an event of default, should they occur. They include the non-payment by the Operating Trust of principal, interest or other obligations of the Operating Trust in respect of the Notes and a breach of any covenant pursuant to the ABL Facility credit agreement (discussed below), subject to customary cure periods where applicable. If any event of default occurs under the Notes’ trust indenture, the holders of the Notes may require the Operating Trust to repay any outstanding obligations pursuant to the Notes’ trust indenture, which would, among other things, negatively impact the Operating Trust’s ability to make cash distributions. ABL Facility The Operating Trust’s ABL Facility provides availability of up to $150 million with a maturity date of July 28, 2016. Under the credit agreement entered into in connection with the ABL Facility, the Fund is permitted to distribute excess cash flows to its Unitholders subject to maintaining a minimum excess availability and other customary restrictions. The borrowing base is tested on a monthly basis so long as excess availability is equal to or greater than $15 million and on a weekly basis if excess availability over the most recent 45-day period is less than $15 million. As at September 30, 2013, the borrowing base on the ABL Facility based on the Fund’s working capital position was $87.4 million: $0.4 million was being used for letters of credit, leaving an excess availability of $87.0 million. The ABL Facility credit agreement lists events that constitute an event of default, should they occur. They include the non-payment by the Fund of principal, interest or other obligations of the Fund in respect of the ABL Facility credit agreement, a default under the Notes’ trust indenture that permits, or has resulted in, the acceleration of the obligations owing to the holders of Notes, and a breach of any covenant pursuant to the ABL Facility credit agreement, subject to the customary cure periods where applicable. If any event of default occurs under the ABL Facility 17

credit agreement, the ABL Facility lenders will be under no further obligation to make advances to the Fund and may require the Fund to repay any outstanding obligations pursuant to the ABL Facility credit agreement, which would, among other things, negatively impact the Fund’s ability to make cash distributions. The Notes and the ABL Facility are fully and unconditionally guaranteed, on a senior secured basis (subject to the terms of an intercreditor agreement with the lenders under the ABL Facility), by the Fund, Ontario Inc., the Manager, the Partnership and NILP General Partner Ltd., the Partnership’s general partner. Financial Security In February 2013, the Québec Government introduced a draft regulation to amend the current regulation for the Mining Act (Québec) (the “Mining Act”). In the third quarter of 2013, the draft regulation related to financial security was enacted. Under the previous Mining Act regulation, the Fund posted $0.4 million of financial security, in the form of letters of credit, as at September 30, 2013. Under the new regulation and the current cost estimates that have been filed with the Government, the financial security requirements are expected to increase by $8.0 million in August 2014, $4.2 million in August 2015 and $4.2 million in August 2016. Any financial security that is posted is expected to reduce the excess availability on the ABL Facility, and may negatively impact cash available for distribution, if any, to Unitholders. The Fund has provided certain forward-looking information regarding the Notes, the ABL Facility and financial security under the Mining Act, which are subject to various risks and uncertainties. Some of the risks, uncertainties and assumptions underlying this information can be found in the section entitled “Forward-Looking Information” below.

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OUTSTANDING UNITS Outstanding Unit Data Priority Units Ordinary Units and Special Fund Units

As at November 11, 2013 37,497,975 12,500,000

As noted above, a wholly-owned subsidiary of Glencore Canada holds 12,500,000 Ordinary Units of the Partnership, which represent all of the outstanding Ordinary Units of the Partnership, and which are exchangeable for Priority Units on a one-for-one basis only after May 2, 2017, or earlier upon the occurrence of certain events. The 12,500,000 outstanding special voting units of the Fund listed above (the “Special Fund Units”) provide voting rights in respect of the Fund to the holder of Ordinary Units. Further details concerning the rights, privileges and restrictions attached to the Fund’s outstanding Priority Units and Special Fund Units and the outstanding Ordinary Units of the Partnership, are contained in the Fund’s Annual Information Form under the section entitled “General Description of the Capital Structure”. A copy is available on SEDAR at www.sedar.com.

LITIGATION In August 2004, the Manager was served with a motion to institute a class action before the Québec Superior Court, following an accidental discharge of sulphur trioxide. In June 2008, the Québec Superior Court dismissed the motion to institute a class action. The plaintiff appealed the decision. In August 2009, the Québec Court of Appeal dismissed the appeal. In December 2009, the Manager was served a new motion to institute a class action. On March 19, 2012, the Québec Superior Court authorized the motion to institute a class action against the Manager. In August 2012, the class action statement of claim was served upon the Manager and was filed in Court, and the class representative has made a motion to add the Fund as a “mis en cause” (interested party) and add Xstrata plc and Glencore Canada as co-defendants with the Manager. The Court is currently in the process of determining whether the Fund should be recognized as a “mis en cause” and whether Xstrata plc and Glencore Canada should be added as co-defendants with the Manager. The Manager continues to maintain that the class action suit is unfounded and intends to vigorously defend the claim. The Fund is currently in discussions with the Province of Québec regarding land that it is using. This land was appropriated by the Provincial Government in the 1970s. The Fund is discussing the potential purchase of this land.

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RELATED PARTY TRANSACTIONS The Fund has entered into significant agreements with related parties which are outlined in the Fund’s 2012 annual MD&A under the section “Transactions with Related Parties”, in the Notes to the December 31, 2012 audited Consolidated Financial Statements and in the Notes of the unaudited Interim Condensed Consolidated Financial Statements for the third fiscal quarter ended September 30, 2013.

CRITICAL ACCOUNTING ESTIMATES AND CHANGES IN ACCOUNTING POLICY The Fund’s accounting policies are disclosed in the Notes to the December 31, 2012 audited Consolidated Financial Statements.

CRITICAL ACCOUNTING ESTIMATES The Fund’s consolidated financial statements include estimates and assumptions made by the management relating to the results of operations, financial condition, contingencies, commitments and related disclosures. Actual results may vary from these estimates. Critical accounting estimates are discussed under Note 2 of the December 31, 2012 audited Consolidated Financial Statements.

CHANGES IN ACCOUNTING POLICY The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Fund’s annual consolidated financial statements for the year ended December 31, 2012, except for the adoption of the new standards and interpretations effective January 1, 2013. The nature and the impact of each new standard/amendment is described below: IAS 1 Presentation of Financial Statements - Components of Other Comprehensive Income The amendments to IAS 1 change the grouping of items presented in other comprehensive income. Items that could be reclassified (or “recycled”) to profit or loss at a future point in time would be presented separately from items that will never be reclassified such as actuarial gain (loss) on employee benefits. The Fund adopted IAS 1 on January 1, 2013 and the amendment affects presentation only and therefore has no impact on the Fund’s financial position or performance. IAS 1 Clarification of the Requirement for Comparative Information (Amendment) The amendment to IAS 1 clarifies the difference between voluntary additional comparative information and the minimum required comparative information. An entity must include comparative information in the related notes to the financial statements when it voluntarily provides comparative information beyond the minimum required comparative period. The additional voluntary comparative information does not need to be presented in a complete set of financial statements. 20

IFRS 10 Consolidated Financial Statements IFRS 10 establishes a single control model that applies to all entities including special purpose entities. IFRS 10 replaces the parts of previously existing IAS 27, Consolidated and Separate Financial Statements, that dealt with consolidated financial statements and SIC-12, Consolidation – Special Purpose Entities. IFRS 10 changed the definition of control such that an investor controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. To meet the definition of control in IFRS 10, all three criteria must be met, including: a) the investor has power over the investee; b) the investor has exposure, or rights, to variable returns from its involvement with the investee; and c) the investor has the ability to use its power over the investee to affect the amount of the investor’s returns. IFRS 10 was effective for annual periods beginning on or after January 1, 2013. The Fund adopted IFRS 10 on January 1, 2013 and it did not have any impact on its interim condensed consolidated financial statements, as the Fund continues to consolidate the Manager. IFRS 11 Joint Arrangements IFRS 11 replaces IAS 31, Interests in Joint Ventures, and SIC-13, Jointly Controlled Entities Non-monetary Contributions by Venturers. IFRS 11 removes the option to account for jointly controlled entities (“JCEs”) using proportionate consolidation. Instead, JCEs that meet the definition of a joint venture must be accounted for using the equity method. IFRS 11 was effective for the annual periods beginning on January 1, 2013. The adoption of this standard did not have any impact on the Fund’s interim condensed consolidated financial statements. IFRS 12 Disclosure of Interests in Other Entities IFRS 12 sets out the requirements for disclosures relating to an entity’s interest in subsidiaries, joint arrangements, associates and structured entities. IFRS 12 was effective for annual periods beginning January 1, 2013. None of these disclosures requirements are applicable for interim condensed consolidated financial statements, unless significant events and transactions in the interim period require that they are provided. Accordingly, in the absence of such events, the Fund has not made such disclosures. IFRS 13 Fair Value Measurement IFRS 13 establishes a single source of guidance under IFRS for all fair value measurements. IFRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. IFRS 13 was effective January 1, 2013. The Fund adopted it on January 1, 2013 and the application of IFRS 13 has not materially impacted the fair value measurements carried by the Fund. IFRS 13 also requires specific disclosure on fair values, some of which replace existing disclosure requirements in other standards, including IFRS 7, Financial Instruments: Disclosures. Some of these disclosures are specifically required for financial instruments by IAS 34.16A(j), thereby affecting the interim condensed consolidated financial statements period. The Fund provides these disclosures in Note 9 of the interim condensed consolidated financial statements.

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IAS 19 Employee Benefits (Revised 2011)(“IAS 19R”) IAS 19R includes a number of amendments to the accounting for defined benefit plans, including expected returns on plan assets that are no longer recognized in comprehensive income, instead, there is a requirement to recognize interest on the employee benefits in earnings attributable to unitholders, calculated using the discount rate used to measure the defined benefit obligation. Other amendments include new disclosures, such as quantitative sensitivity disclosures. The Fund implemented IAS 19R effective January 1, 2012 and there was no impact on the Fund’s opening net assets attributable to Unitholders and non-controlling interest as a result of the implementation other than a decrease of $0.4 million in the earnings attributable to Unitholders and non-controlling interest and a corresponding decrease in actuarial loss on employee benefits, net of tax. For the three and nine month periods ended September 30, 2012, the Fund’s earnings attributable to Unitholders and non-controlling interest decreased by $0.1 million and $0.3 million with corresponding decreases in actuarial loss on employee benefit plans, net of tax.

INTERNAL CONTROLS OVER FINANCIAL REPORTING The Fund’s management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements of the Fund for external purposes in accordance with IFRS. There were no changes in the internal controls over financial reporting of the Fund during the most recent interim reporting period that have materially affected, or are reasonably likely to materially affect, the internal controls over financial reporting of the Fund.

OTHER DEVELOPMENTS On November 5, 2013, Manuel Álvarez Davila resigned from the Board of the Noranda Operating Trust. A replacement candidate is expected to be appointed soon.

OUTLOOK The US Purchasing Manager’s Index (“PMI”) reading for October 2013 suggested that manufacturing growth is continuing to be more robust. The US Institute for Supply Management October 2013 PMI manufacturing index reading stood at 56.4, up from 0.2 the previous month, and 5.5 points stronger than June 2013 index. A reading above 50.0 is generally considered to be indicative of an expanding economy. US automotive sales in October 2013 continued at a strong pace of 15.2 million units per year, which is 10.6% higher than year-over-year. US spending on construction in August was 7.1% higher than in August 2012. Zinc demand in the third quarter was steady, following a strong surge in demand in the second 22

quarter. Customers are maintaining a cautious outlook for the balance of the year as demand tends to trail off in the final weeks of the quarter due to seasonal factors.

The Fund’s estimates for 2013 production, sales, processing fee and capital expenditures, are as follows: Production: Sales: Processing fee: Capital expenditures

265,000 tonnes 265,000 tonnes 39.5 cents per pound $871 per tonne $40.4 million

The Fund’s ability to meet the targets identified above is subject to various risks, uncertainties and assumptions, some of which can be found in the “Forward-Looking Information” below.

FORWARD-LOOKING INFORMATION This MD&A, including sections entitled “Results of Operations”, “Key Performance Drivers”, “Distribution Policy”, “Liquidity and Capital Resources” and “Outlook”, contains forwardlooking statements and forward-looking information within the meaning of applicable securities laws. Forward-looking statements can generally be identified by the use of words such as “anticipates”, “believes”, “plans”, “intends”, “estimates”, “are expected”, “is forecast”, “approximately” or variations of such words and phrases, or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or words and expressions of similar nature. Amongst others, the Fund has made forward-looking statements for 2013 expected targets and performance, production, sales, the processing fee and capital expenditures, the Fund and the Operating Trust’s future business plans and operation of the Processing Facility, future liabilities and obligations of the Fund (including capital expenditures), the ability of the Fund to operate profitably after May 2017, the dependence upon the continuing supply of zinc concentrates and competition relating thereto, the ability of the Processing Facility to treat a more varied feed quality stream and run at full or close to full capacity, anticipated trends in zinc concentrate supply and demand, smelting capacity, sulphuric acid market demand and supply, zinc concentrate treatment charges, the anticipated financial and operating results of the Fund and distributions to Unitholders. The Fund provides this information because they are the key drivers of the business. Readers are cautioned that this information may not be appropriate for other reasons. These statements and information are based, among others, on the Fund’s current assumptions, expectations, estimates, objectives, plans and intentions regarding projected revenues and expenses, the economic and industry environments in which the Fund operates or which could affect the Fund’s activities, the Fund’s ability to attract and retain clients and consumers as well as the Fund’s operating costs, raw materials and energy supplies which are subject to a number of risks and uncertainties.

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Forward-looking information involves known and unknown risks, uncertainties and other factors, which may cause the actual events, results or performance to be materially different from any future events, results or performance expressed or implied by the forward-looking information. As a result, the Fund cannot guarantee that any forward-looking statements will materialize. Assumptions, expectations and estimates made in the preparation of forward-looking statements and risks that could cause the Fund’s actual events, results or performance to differ materially from the Fund’s current expectations are discussed throughout this document and in our other continuous disclosure materials available on SEDAR at www.sedar.com. Examples of such risks, uncertainties and other factors include, but are not limited to: (1) the Fund’s ability to operate at normal production levels; (2) the dependence upon the continuing supply of zinc concentrates (terms of the Supply and Processing Agreement); (3) the demand for zinc metal, sulphuric acid and copper in cake; (4) the ability to manage sulphuric acid inventories; (5) changes to the supply and demand for specific zinc metal products and the impact on the Fund’s realized premiums; (6) changes in future zinc concentrate, zinc grade and impurity levels and their potential impact on capital expenditure and working capital requirements, operating costs, production and recoveries; (7) reliance on Glencore Canada and certain of its affiliates for the management, operation and maintenance of the Processing Facility, the Fund and the Operating Trust and credit support in connection with the ABL Facility and Notes; (8) the ability of the Fund to continue to service customers in the same geographic region; (9) general business and economic conditions and the condition of financial and credit markets; (10) legislation governing the operation of the Fund including, without limitation, air emissions, discharges into water, waste including residue ponds, hazardous materials, workers’ health and safety, and many other aspects of the Fund’s operations, as well as the impact of current legislation and regulations on expenses, capital expenditures, taxation and restrictions on the operation of the Processing Facility; (11) loan default and refinancing risk associated with the ABL Facility and Notes; (12) the impact of costs and liabilities related to the closure, decommissioning, reclamation and rehabilitation of the Processing Facility and surrounding lands, including employee severance, pensions, and environmental and reclamation and rehabilitation liabilities if an acceptable replacement arrangement is not put in place after the expiration of the Supply and Processing Agreement; (13) the sensitivity of the Fund’s Net Revenues to reductions in realized zinc metal prices including premiums, copper prices, sulphuric acid prices; and the strengthening of the Canadian dollar vis-à-vis the US dollar; (14) the impact of month prior pricing; (15) the sensitivity of the Fund’s production costs to increases in electricity rates, other energy costs, labour costs and operating supplies used in its operations, and the sensitivity of the Fund’s interest expense to increases in interest rates; (16) potential negative financial impact from regulatory investigations, claims, lawsuits and other proceedings; and (17) the other general risks and uncertainties set out in the Fund’s continuous disclosure documents on file with the Canadian Securities Regulatory Authorities. Forward-looking information contained in this MD&A is based on management’s current estimates, expectations and assumptions, which management believes are reasonable as of the current date. You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. Except as required by law, the Fund does not undertake to update these forward-looking statements, whether written or oral, that may be made from time to time by the Fund or on the Fund’s behalf.

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Noranda Income Fund is an income trust whose units trade on the Toronto Stock Exchange under the symbol “NIF.UN”. Noranda Income Fund owns the electrolytic zinc processing facility and ancillary assets (the “Processing Facility”) located in Salaberry-de-Valleyfield, Québec. The Processing Facility is the second-largest zinc processing facility in North America and the largest zinc processing facility in eastern North America, where the majority of zinc customers are located. It produces refined zinc metal and various by-products from sourced zinc concentrates. The Processing Facility is operated and managed by Canadian Electrolytic Zinc Limited, a wholly-owned subsidiary of Glencore Canada Corporation. Further information about the Noranda Income Fund can be found at www.norandaincomefund.com Contact: Financial information: Michael Boone, Vice President & Chief Financial Officer of Canadian Electrolytic Zinc Limited, Noranda Income Fund’s Manager Tel: 416-775-1561 [email protected]

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