9) Share capital

Authorized:

unlimited common shares, no par value


	in thousands of dollars, except share amounts
	Number of shares	Ascribed value
		$
November 30, 2018	131,585,612	164,069
Exercise of options	1,725,776	1,123
Restricted Share Units	412,501	424
Deferred Share Units	182,132	189
Exercise of warrants	6,521,740	12,166
November 30, 2019	140,427,761	177,971
Exercise of options	82,624	38
Restricted Share Units	412,501	642
May 31, 2020, issued and outstanding	140,922,886	178,651

On April 30, 2012, under the NovaGold Arrangement, Trilogy committed to issue common shares to satisfy holders of NovaGold deferred share units (“NovaGold DSUs”) on record as of the close of business April 27, 2012. When vested, Trilogy committed to deliver one common share to the holder for every six shares of NovaGold the holder is entitled to receive, rounded down to the nearest whole number. As of May 31, 2020, 11,927 NovaGold DSUs remained outstanding representing a right to receive 1,988 common shares in Trilogy, which will settle upon certain directors retiring from NovaGold’s board.

(a)Stock options

During the period ended May 31, 2020, the Company granted 2,325,000 options (2019 - 2,527,500 options) at a weighted-average exercise price of CAD$2.93 (2019 - CAD$2.96) to employees, consultants and directors exercisable for a period of five years with various vesting terms from immediate vesting to vesting over a two-year period. The weighted-average fair value attributable to options granted in the period was $0.96 (2019 - $1.08).

For the period ended May 31, 2020, Trilogy recognized a stock-based compensation charge of $1.58 million (2019 – $1.94 million) for options granted to directors, employees and service providers, net of estimated forfeitures.

The fair value of the stock options recognized in the period has been estimated using the Black-Scholes option pricing model.

Assumptions used in the pricing model for the period are as provided below.


	May 31, 2020
Risk-free interest rates	1.50	%
Exercise price	CAD$3.07
Expected life	3.0 years
Expected volatility	63.3	%
Expected dividends	Nil

As of May 31, 2020, there were 1,453,338 non-vested options outstanding with a weighted average exercise price of $2.15; the non-vested stock option expense not yet recognized was $0.71 million. This expense is expected to be recognized over the next two years.

A summary of the Company’s stock option plan and changes during the period ended May 31, 2020 is as follows:


	May 31, 2020
		Weighted average
		exercise price
	Number of options	$
Balance – beginning of the period	9,205,600	1.05
Granted	2,325,000	2.13
Exercised	(151,667)	0.56
Forfeited	(260,000)	2.15
Balance – end of period	11,118,933	1.25

The following table summarizes information about the stock options outstanding at May 31, 2020.


	Outstanding			Exercisable		Unvested
			Weighted		Weighted
	Number of	Weighted	average	Number of	average	Number of
	outstanding	average years	exercise price	exercisable	exercise price	unvested
Range of price	options	to expiry	$	options	$	options
$0.32 to $0.50	3,901,433	0.81	0.40	3,901,433	0.81	—
$0.51 to $1.00	1,845,000	2.48	0.73	1,845,000	2.48	—
$1.01 to $1.50	225,000	2.87	1.29	175,000	2.83	50,000
$1.51 to $2.00	915,000	4.41	1.72	898,333	4.43	16,667
$2.01 to $2.54	4,232,500	4.03	2.17	2,895,829	3.92	1,336,671
	11,118,933	2.65	1.25	9,715,595	2.43	1,403,338

The aggregate intrinsic value of vested share options (the market value less the exercise price) at May 31, 2020 was $8.3 million (2019 - $17.6 million) and the aggregate intrinsic value of exercised options for the three months ended May 31, 2020 was $0.18 million (2019 - $0.30 million).

(b)Restricted Share Units and Deferred Share Units

The Company has a Restricted Share Unit Plan (“RSU Plan”) and a Non-Executive Director Deferred Share Unit Plan (“DSU Plan”) to provide long-term incentives to employees, officers and directors. Awards under the RSU Plan and DSU Plan may be settled in cash and/or common shares of the Company at the Company’s election with each restricted share unit (“RSU”) and deferred share unit (“DSU”) entitling the holder to receive one common share of the Company or equivalent value. All units are accounted for as equity-settled awards.

A summary of the Company’s unit plans and changes during the period ended May 31, 2020 is as follows:


	Number of RSUs	Number of DSUs
Balance – beginning of the period	212,501	1,137,488
Granted	200,000	44,903
Vested/paid	(412,501)	—
Balance – end of period	—	1,182,391

For the period ended May 31, 2020, Trilogy recognized a stock-based compensation charge of $0.39 million (2019- $0.66 million), net of estimated forfeitures.

The 200,000 RSUs granted and fully vested during the period were settled on April 16, 2020 through the issuance of 200,000 common shares. The 225,000 RSUs granted for the annual incentive payout for the 2018 fiscal year vested half on the grant date and half on the first anniversary of the grant date. RSUs vesting in December 2019 were settled on December 17, 2019 through the issuance of 212,501 common shares.