Share capital

3 Months Ended

Feb. 28, 2017

Equity [Abstract]

Share capital [Text Block]

7. Share capital

Authorized:

unlimited common shares, no par value

in thousands of dollars, except share amounts

			Ascribed value
	Number of shares		$
November 30, 2015		104,796,421		136,040
Exercise of options		162,854		65
Restricted Share Units		108,399		34
Deferred Share Units		218,795		218
November 30, 2016		105,286,469		136,357
Exercise of options		24,594		9
Restricted Share Units		209,198		83
February 28, 2017, issued and outstanding		105,520,261		136,449

On April 30, 2012, under the NovaGold Arrangement, Trilogy committed to issue up to 6,181,352 common shares, once vested and exercised, to satisfy holders of NovaGold warrants (“NovaGold Warrants”), performance share units (“NovaGold PSUs”) and deferred share units (“NovaGold DSUs”) on record as of the close of business April 27, 2012. When exercised or 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. All NovaGold Warrants have been exercised and all NovaGold PSUs have vested. As of February 28, 2017, 20,685 NovaGold DSUs remain outstanding representing a right to receive 3,447 Common Shares in Trilogy, which will settle upon certain directors retiring from NovaGold’s board, and 66,664 NovaGold Arrangement Options remain outstanding as disclosed in note 7(b).

(a) Stock options

During the period ended February 28, 2017, 1,595,000 options (February 29, 2016 – 1,785,000 options) at a weighted-average exercise price of CAD$0.70 (February 29, 2016 – CAD$0.44) were granted to employees, consultants and directors exercisable for a period of five years with various vesting terms between nil and two years. The weighted-average fair value attributable to options granted in the period was $0.22.

For the period ended February 28, 2017, Trilogy recognized a stock-based compensation charge of $0.22 million (February 29, 2016– $0.18 million) for options granted to directors, employees and service providers, net of 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.

	February 28, 2017
Risk-free interest rates		0.91	%
Exercise price		CDN$0.70
Expected life		3.0 years
Expected volatility		74.2	%
Expected dividends		Nil

As of February 28, 2017, there were 1,425,009 non-vested options outstanding with a weighted average exercise price of $0.44; the non-vested stock option expense not yet recognized was $0.2 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 is as follows:

			February 28, 2017
			Weighted average exercise price
	Number of options		$
Balance – beginning of period		6,049,433		0.50
Granted		1,595,000		0.53
Exercised		(71,666)		0.34
Forfeited		(63,335)		0.35
Balance – end of period		7,509,432		0.52

The following table summarizes information about the stock options outstanding at February 28, 2017.

			Outstanding				Exercisable				Unvested
					Weighted average exercise price				Weighted average exercise price
Range of price	Number of outstanding options		Weighted average years to expiry		$		Number of exercisable options		$		Number of unvested options
$0.33 to $0.50		4,564,432		3.46		0.39		3,852,762		0.39		711,670
$0.51 to $1.00		2,890,000		3.78		0.70		2,176,661		0.76		713,339
$1.01 to $1.49		55,000		1.17		1.49		55,000		1.49		-
		7,509,432		3.57		0.52		6,084,423		0.53		1,425,009

The aggregate intrinsic value of vested share options (the market value less the exercise price) at February 28, 2017 was $0.2 million (February 29, 2016 - $0.01 million) and the aggregate intrinsic value of exercised options for the three months ended February 28, 2017 was $0.01 million (February 29, 2016 - $nil).

(b) NovaGold Arrangement Options

Under the NovaGold Arrangement, holders of NovaGold stock options received one option in Trilogy for every six options held in NovaGold (“NovaGold Arrangement Options”). All NovaGold Arrangement Options are vested and subject to NovaGold’s stock option plan. The options were fully expensed during the year ended November 30, 2014 and no further expense is recognized.

A summary of the NovaGold Arrangement Options and changes during the period ended is as follows:

			February 28, 2017
			Weighted average exercise price
	Number of options		$
Balance – beginning of period		312,195		4.28
Expired		(245,531)		4.45
Balance – end of period		66,664		3.83

The following table summarizes information about the NovaGold Arrangement Options outstanding at February 28, 2017.

	Outstanding and exercisable
					Weighted average exercise price
Range of price	Number of outstanding options		Weighted average years to expiry		$
$2.78 to $3.99		49,998		0.08		2.94
$4.00 to $5.99		-		-		-
$6.00 to $6.48		16,666		0.25		6.51
		66,664		0.12		3.83

The aggregate intrinsic value of vested NovaGold Arrangement Options (the market value less the exercise price) at February 28, 2017 was $nil (February 29, 2016 - $nil).

(c) 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. The RSU Plan and DSU Plan may be settled in cash and/or Common Shares at the Company’s election with each RSU and 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 is as follows:

	Number of RSUs		Number of DSUs
Balance – beginning of period		400,001		925,390
Granted		600,000		33,258
Vested/paid		(399,999)		-
Balance – end of period		600,002		958,648

For the three months ended February 28, 2017, Trilogy recognized a stock-based compensation charge of $0.17 million (February 29, 2016- $0.10 million), net of forfeitures.

On December 15, 2016, 600,000 RSUs were granted to officers vesting one third immediately, one third on the first anniversary of the grant date, and one third on the second anniversary. On December 23, 2016, 399,999 RSUs vested and were settled through the issuance of 209,198 shares and a cash payment of $90,000 to cover tax withholdings.

(d) Share Purchase Warrants

A summary of the Company’s warrants and changes during the three months ended February 28, 2017 is as follows:

					Weighted average exercise price
	Number of Warrants		Weighted average years to expiry		$
Balance – beginning of period		6,521,740		2.60		1.60
Balance – end of period		6,521,740		2.60		1.60