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Noranda Income Fund: Clearwater and West Face Have Withdrawn Their Requisition for a Special Meeting

The Special Meeting Will Be Cancelled

Nov 2, 2010 - 09:10 ET

VALLEYFIELD, QUEBEC--(Marketwire - Nov. 2, 2010) - Noranda Income Fund (the "Fund") (TSX:NIF.UN) announced today that the Fund, Clearwater Capital Management Inc. ("Clearwater") and West Face Capital Inc. ("West Face") are pleased to announce that Clearwater and West Face (together, the "Requisitioning Unitholders") have withdrawn their requisition for a special meeting of unitholders of the Fund. As a result, the unitholder meeting that had been scheduled for November 15, 2010 will be cancelled.

The Requisitioning Unitholders had submitted a requisition on August 30, 2010 for a meeting to replace the independent trustees then holding office, and to fill a vacancy in the Noranda Operating Trust ("NOT") board (the "Board"). At that time the Fund was party to a letter of intent (the "LOI") with respect to a potential acquisition of the Fund by Xstrata Canada Corporation (together with its affiliates, "Xstrata Canada"). Shortly after the requisition being submitted, the LOI was terminated, and the independent trustees then holding office resigned. Since that time four new independent trustees have been appointed to the Board and constituted as an Independent Committee, and the Independent Committee has engaged, on behalf of NOT, TD Securities Inc. as its independent financial advisor to advise in the re-financing by the Fund of its credit facility and term notes (which are presently scheduled to mature late in 2010).

On October 29, 2010, the Requisitioning Unitholders met with the Independent Committee and its financial advisor to discuss the Requisitioning Unitholders' perspectives concerning governance, operating, financing, and distribution issues. As a result of these discussions, and the guiding principles agreed to by the Independent Committee to (i) maintain best practice governance standards and practices, (ii) proactively and diligently oversee the business and affairs of the Fund, with specific reference to the Fund's refinancing process, and (iii) duly consider all reasonable financing alternatives including an asset-based working capital facility, the Requisitioning Unitholders agreed to withdraw the requisition.

Mr. John Swidler, Chair of the Independent Committee of the Board, welcomed the withdrawal of the requisition. Mr. Swidler commented, "The Independent Committee understands the disappointment that Priority Unitholders have experienced as a result of the disruption of Priority Unit distributions beginning in July 2009, and the lack of progress the Fund has made since the beginning of 2010 in refinancing its credit facility and term notes."

Mr. Swidler added, "On behalf of the Independent Committee I wish to express our commitment to directly manage and oversee the refinancing process of the Fund. Within the framework of the agreements Xstrata Canada, a related party, the independent members of the Board look forward to building and maintaining unitholder confidence in the Fund, and working to enhance unitholder value."

Mr. Roland Keiper, President of Clearwater, commented "I look forward to the newly appointed Independent Committee and its choice of financial advisor, TD Securities Inc., taking direct control of the Fund's refinancing process. I am pleased that the Independent Committee will seek to complete a refinancing of the Fund that is in the best interests of the Fund, and believe that diligent fulfillment of this objective will contribute to the successful completion of such a refinancing."

Noranda Income Fund is an income trust whose units trade on the Toronto Stock Exchange under the symbol "NIF.UN". Noranda Income Fund was created to acquire Noranda Inc.'s CEZ processing facility and ancillary assets (the "CEZ processing facility") located in Salaberry-de-Valleyfield, Québec. The CEZ 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 its customers are located. It produces refined zinc metal and various by-products from zinc concentrates purchased from mining operations. The CEZ processing facility is operated and managed by Canadian Electrolytic Zinc Limited.

Further information about Noranda Income Fund can be found at


Michael Boone
Vice President and Chief Financial Officer,
Canadian Electrolytic Zinc Limited
Noranda Income Fund's Manager

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