UNALLOCATED RESERVE AND DISTRIBUTIONS

12 Months Ended

Jan. 31, 2023

UNALLOCATED RESERVE AND DISTRIBUTIONS

NOTE 4 - UNALLOCATED RESERVE AND DISTRIBUTIONS

Each quarter, as authorized by the Agreement of Trust, the Trustees will reevaluate all relevant factors including all costs, expenses, obligations, and present and future liabilities of the Trust (whether known or contingent) in determining a prudent level of unallocated reserve in light of the unpredictable nature of the iron ore industry and current economic conditions. The actual amount of the Unallocated Reserve will fluctuate from time to time and may increase or decrease from its current level. Accordingly, although the actual amount of the Unallocated Reserve will fluctuate from time to time, and may increase or decrease from its current level, it is currently expected that future distributions will be highly dependent upon royalty payments received quarterly and the level of Trust expenses that the Trustees anticipate occurring in subsequent quarters.

As of January 31, 2023 and January 31, 2022, the unallocated cash and U.S. Government Securities portion of the Trust’s Unallocated Reserve consisted of the following components:

	January 31, 2023		January 31, 2022
Cash and U.S. Government securities	$	13,966,500	$	47,727,522
Distribution payable		—		(22,960,018)
Unallocated cash and U.S. Government securities	$	13,966,500	$	24,767,504

A reconciliation of the Trust’s Unallocated Reserve from January 31, 2022 to January 31, 2023 is as follows:

		Unallocated		Trust
		Reserve		Corpus		Total
Balances as of January 31, 2022	$	30,794,749	$	3	$	30,794,752
Net income		5,309,085		—		5,309,085
Distributions declared - $1.8800 per unit		(24,665,620)		—		(24,665,620)
Balances as of January 31, 2023	$	11,438,214	$	3	$	11,438,217

The Trustees determine the level of distributions on a quarterly basis after receiving notification from NMC as to the amount of royalty income that will be received and after determination of any known or anticipated expenses, liabilities and obligations of the Trust. As a result of fluctuations in the accrued income receivable portion of the Unallocated Reserve, future distributions may vary depending upon the adjustments to royalty income, which are determined by NMC, and the level of Trust expenses that the Trustees anticipate occurring in subsequent quarters.

During the fiscal years ended January 31, 2023, 2022, and 2021, the Trustees distributed cash payments totaling $47,625,638 ($3.63 per Unit), $37,523,229 ($2.86 per Unit), and $21,910,417 ($1.67 per Unit), respectively. In addition, in January 2023, the Trustees declared no distribution per Unit of beneficial interest.