Glossary

By-products  |  Capacity  |  Fund  |  LME  |  Manager  |  Ordinary Units
Payable Zinc Metal  |  Premiums  |  Priority Units  |  Processing Facility  |  Processing Fee
Products  |  Recoveries  |   Supply and Processing Agreement  |  Tonne or mt

By-products
refer to products that are produced at the Processing Facility during the process of making zinc metal. They include copper cake, cobalt cake, cadmium sponge and sulphuric acid.

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Capacity
The potential level of production at the plant over a period a time, given the assumed infrastructure.

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Fund
Noranda Income Fund

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LME
London Metal Exchange

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Manager
Under the Administration Agreement, the Manager, a wholly-owned subsidiary of Glencore Canada, will provide the Fund with administrative and support services. Under the Management Services Agreement, the Manager provides Management and support services to the Operating Trust.

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Ordinary Units
total 12,500,000 units and represent 25% of the economic interest of the Fund. Ordinary Units, held by Glencore Canada, are subordinated to the Priority Units. They are not transferable and are exchangeable for Priority Units on a one-for-one basis only in 2017, or upon the occurrence of certain events.

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Payable Zinc Metal
In respect to a quantity of concentrate, 96% of the assayed zinc metal content of the concentrate.

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Premiums
As a consequence of strategic location and unique products, the Facility earns a payment above the commodity grade zinc price.

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Priority Units
Class A priority units of the Noranda Income Fund are listed and posted on the Toronto Stock Exchange under the symbol of NIF.UN. There are 37,497,975 units, representing an effective amount of 75% of the Fund.

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Processing Facility
Zinc processing plant located in Salaberry-de-Valleyfield, Québec.

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Processing Fee
The Fund is paid a fixed fee of 35.2 cents per pound to process zinc concentrate into zinc metal. This fee is adjusted upwards by 1% per annum starting January 1, 2004. The processing fee is adjusted upwards or downwards by approximately 50% of the change in the annual electricity cost from the preceding year.

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Products
The Processing Facility produces zinc as jumbo, shot and granulated zinc in varying grades and specifications. Zinc slab is the general commodity grade metal for which the market prices are quoted on the LME. The Processing Facility's zinc products command a premium over the quoted LME commodity grade zinc price.

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Recoveries
The processing fee paid to the Facility is based on a recovery rate of 96% of the zinc metal content in the concentrate. The Facility typically recovers in excess of 96%, thereby earning additional revenue.

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Supply and Processing Agreement
Glencore Canada is obligated for 15 years to provide zinc concentrates to the Fund. The agreement supports 100% of the plant's production requirements.

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Tonne or mt
1,000 kilograms or 2,204 pounds

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