3)    Investment in Ambler Metals LLC

On February 11, 2020, the Company completed the formation of a 50/50 joint venture named Ambler Metals LLC (“Ambler Metals”) with South32 Limited (“South32”). As part of the formation of the joint venture, Trilogy contributed all its assets associated with the UKMP, including the Arctic and Bornite Projects, while South32 contributed cash of $145.0 million, resulting in each party’s subsidiaries directly owning a 50% interest in Ambler Metals.

Ambler Metals is a company jointly controlled by Trilogy and South32 through a four-member board, of which two members are appointed by Trilogy based on its 50% equity interest. All significant decisions related to the UKMP require the approval of both companies. We determined that Ambler Metals is a VIE because it is expected to need additional funding from its owners for its significant activities. However, we concluded that we are not the primary beneficiary of Ambler Metals as the power to direct its activities, through its board, is shared under the Ambler Metals limited liability company agreement. As we have significant influence over Ambler Metals through our representation on its board, we use the equity method of accounting for our investment in Ambler Metals. Our maximum exposure to loss in this entity is limited to the carrying amount of our investment in Ambler Metals, which, as of August 31, 2025, totaled $105.3 million (2024 - $108.1 million).

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Trilogy recognized, based on its 50% ownership interest in Ambler Metals, an equity loss of $2.2 million equivalent to its pro rata share of Ambler Metals’ comprehensive loss of $4.4 million for the nine-month period ending August 31, 2025. The carrying value of Trilogy’s 50% investment in Ambler Metals as at August 31, 2025 is summarized in the following table.

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(c) The following table provides Ambler Metals’ balances on a 100% basis as at August 31, 2025.

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Ambler Metals’ cash and cash equivalents are held at one bank. The majority of the cash and cash equivalents is uninsured as at August 31, 2025.

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(d) The following table summarizes Ambler Metals’ loss for the nine-month period ended August 31, 2025.

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(e) Related party transactions

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During the nine-month period ended August 31, 2025, the Company charged $102,250 (2024 - $47,000) to Ambler Metals related to administrative and accounting services in connection with a service agreement between the Company and Ambler Metals. In addition, the Company received payments of $58,080 (2024 - $64,000) related to expenses paid on behalf of Ambler Metals.