NOTE 5:

RECLAMATION DEPOSITS

Reclamation deposits include interest and non-interest bearing deposits issued in the States of Arizona, Texas and Wyoming relating to exploration, pre-extraction, extraction and reclamation activities in the respective states. Reclamation deposits consisted of the following:

	July 31, 2016		July 31, 2015
Palangana Mine	$	1,102,981	$	1,102,981
Hobson Processing Facility		587,228		587,228
Arizona		15,000		15,000
Wyoming		818		816
	$	1,706,027	$	1,706,025

During Fiscal 2015, the Company secured $5.6 million of surety bonds, subject to a 2% annual premium on the face value, as an alternate source of financial assurance for its future remediation and decommissioning activities at the Palangana Mine and Hobson Processing Facility. These surety bonds replaced an equivalent amount of reclamation deposits funded entirely through cash payments by the Company, providing for the release of $3.9 million in cash to the Company. The remaining $1.7 million, representing 30% of the face value of the surety bonds, is held as restricted cash for collateral purposes as required by the surety.