OGI Financial Report 2013-2014 by Ontario Genomics

Ontario Genomics Institute Financial Report 2014

President and CEO’s Message

Board Chair’s Message

The title of this year’s annual report is “Genomics is changing everything” and it is fair to ask whether that is mere hyperbole or whether there is substance to back up the statement.

genomics. Soy, cotton, canola and corn are already over 50% genetically modified, as we design plants that have improved resistance to pests or draught, or produce food with improved energy or nutritional capacity.

I believe, without question that between the incredible new technologies in informatics and in genomics that the changes will be immense and that the evidence in favor of that prediction is mounting.

We are starting to understand the way in which Genomics can and will allow us to protect our environment where we increasingly see the ravages of progress. We are using microbes to help clean polluted waters and mine tailings. Genetically modified algae are being used to directly convert energy from the sun into cheaper and cleaner biofuels. Biologic/ genomic approaches or bioremediation will allow us to live in a more harmonious way with our environment.

Genomics has become a “game changer” and will continue to have a profound impact on every aspect of our lives, from improving human health and protecting the environment, to increasing the sustainability of our natural resources and agriculture.

New seed funds for industry projects in areas including mining, agriculture and clean water have allowed us to engage industry in our target sectors, support collaboration, and build the case for innovative genomic technologies to address existing challenges.

It has often been said that Ontario and Canada has a wealth of scientific research, but we lag behind in commercializing these breakthroughs. Job creation and a return on investment has long been a mandate of our federal and provincial governments, and the Ontario Genomics Institute continues to demonstrate its value in the future of our province’s economic strength, through facilitating translation and building successful partnerships.

We have continued our strong record of achievement in scientific excellence through research programs, including new large-scale funding in personalized health, bioinformatics and computational biology, and many other sectors through Genome Canada competitions including the Genomics Application Partnership Program.

Our ability to treat disease and lead healthier lives is being transformed as a result of Genomics. Over 50% of the drugs approved by the FDA in 2013/2014 are the product of genomics, and the entire thrust toward personalized medicine that has begun to take hold in cancer has its basis in genomics in understanding a wide variety of cancers and in the development of new diagnostic and therapeutic entities. Our ability to feed the world in healthier and more economic ways, especially in the face of climate change and population growth is being greatly facilitated as a result of

And there is much more to come, especially in the area of synthetic biology, where we now have the ability to construct unique living cells which have the sole purpose of synthesizing new drug or vaccine entities on the health side, improved sources of food on the agriculture side and specific biofuels or enzymes to aide in cleaning up contaminants on the environmental front.

Dr. Mark Poznansky 2

In the past year OGI launched our new Scintelligence division, which uses an industry-pull framework to ensure economic return on research investment. OGI’s business model is based on collaboration between industry and academic institutions, to support the most promising and innovative genomics research to advance Ontario’s economy and drive global competitiveness.

In the past year we have had tremendous success with these initiatives. None of our achievements would have been realized without the hard work, dedication and commitment of our talented staff, and the guidance of our Board of Directors. We also owe great thanks to the federal and provincial governments for their continued support, and of course to our many industry and research partners.

Brian Underdown 3

OGI’s Major Achievements in 2013-14

Scintelligence In September, OGI announced the launch of Scintelligence, an industry-focused division to help companies in a variety of sectors, including health, agricuture and natural resources, to capitalize on research and innovation in the life sciences. Throughout the year, this division engaged the private sector to identify challenges and business needs, and facilitate collaborations between partners in industry, academia and government, and help find sources of funding for innovative projects. This initiative has resulted in a number of excellent partnerships and projects, and fueled our research pipeline through Genome Canada applications and OGI seed funds.

Ontario Personalized Medicine Network The Ontario Personalized Medicine Network (OPMN), is an expert panel created to assess the challenges and opportunities presented by personalized medicine. The OPMN was formed at the request of Ontario’s Ministry of Research and Innovation and the Ministry of Health and Long-Term Care, to ensure Ontario is well positioned to capitalize on this exciting and transformative technology. The OPMN convened three meetings this year, developed a paper comparing personalized medicine strategies from other jurisdictions. 4

OGI distributed three Watching Briefs to inform stakeholders in the community about personalized medicine news and the OPMN’s activities. Three sub-committees were formed and produced reports around high priority issues: •

Electronic medical records that accommodate the delivery of personalized medicine

•

Health technology assessment to help evaluate new genetic tests for reimbursement

•

Produce a framework within MaRS EXCITE to give pre-market guidance to personalized medicine technologies to ensure they have the appropriate information for regulatory and reimbursement decisions

Genomics Application Partership Program The Genomics Application Partnership Program (GAPP) funds research and development projects that address needs identified by industry, government, not-for-profits, and other organization, to move research from lab to marketplace and increase partnerships between industry and academia. In the first round of this program, OGI received 17 Ontario-led Expressions of Interest and one co-led project with Genome Atlantic. All of these projects underwent OGI’s internal review process, and projects that met our criteria were backed with internal and external resources

through full application. As a result of these efforts, both of the projects that submitted full applications that were funded in round one and will receive funds in the coming fiscal year. Further, a number of projects from the first round will receive OGI’s support for full applications in the second round.

OGI seed funding A seed funding program was developed to support industry-driven research and initiate new collaborations. These funds catalyze the application of life sciences solutions to address key sector challenges and opportunities.

OGI is also helping projects secure external seed funding to promote partnerships, where available.

Research project investments OGI continued its record of success in securing and managing Genome Canada funding through two research competitions, including four new projects in the Large-Scale Applied Research Program in Genomics and Personalized Health, and seven projects in the Bioinformatics and Computational Biology competition.

OGI funded three industry seed projects:

Discovery Frontiers Bioinformatics Initiative

•

Developing markers for selectively breeding mite-resistant honey bees. These mites are known to be a major cause of colony loss suffered by bee breeders worldwide

•

Piloting a technology for an Ontario mining company, to develop bioreactor systems including microbial mechanisms to neutralize mine water effluent. This project is studying the microbial communities within the bioreactors at different temperatures to help optimize the technology

•

Increasing the nutritional properties of milk and improving animal welfare in dairy cows through better understanding of genetic determinants of health and milk nutrition in cattle stock

OGI catalyzed applications for the Discovery Frontiers Bioinformatics Initiative through NSERC, Genome Canada, CIHR, and CFI, by bringing big data experts from across Ontario together to discuss a unified approach and helping with project applications. An Ontario project was chosen in this national competition. Led by Dr. Lincoln Stein (Ontario Institute for Cancer Research), the team will develop a resource that will process the International Cancer Genome Consortium’s (ICGC) genomic profile data of 25,000 patients from around the world. Using this tool, cancer researchers will be able to conduct complex data mining and analyses using cancer genome sequence data that will be paired with clinical information. 5

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INDEPENDENT AUDITORS' REPORT To the Board of Directors of Ontario Genomics Institute Report on the Consolidated Financial Statements

INDEPENDENT AUDITORS' REPORT

We have audited the accompanying consolidated financial statements of Ontario Genomics Institute, To the Board of Directors of Ontario Genomics which comprise the consolidated statement Institute of financial position as at March 31, 2014, the consolidated statements of operations, changes in net assets and cash flows for the year then ended, and notes, comprising a summary significant accounting policies and other explanatory Report on the Consolidated Financialof Statements information. Management's Responsibility for the Consolidated Financialstatements Statementsof Ontario Genomics Institute, We have audited the accompanying consolidated financial which comprise the consolidated statement of position of asthese at March 31, 2014, the Management is responsible for the preparation andfinancial fair presentation consolidated financial consolidated operations, changes in netstandards assets and flows fororganizations, the year then and ended, statements instatements accordanceofwith Canadian accounting for cash not-for-profit for and summary of determines significant is accounting and the other explanatory such notes, internalcomprising control asa management necessarypolicies to enable preparation of information. consolidated financial statements that are free from material misstatement, whether due to fraud or error. Management's Responsibility for the Consolidated Financial Statements

Auditors' Responsibility Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with Canadian accounting for not-for-profit organizations, for Our responsibility is to express an opinion on these standards consolidated financial statements based and on our such control our as audit management determines is necessary to accepted enable the preparation of audit. internal We conducted in accordance with Canadian generally auditing standards. consolidated financial statements that arewith freeethical from material misstatement, whether due the to fraud Those standards require that we comply requirements and plan and perform audit or to error. obtain reasonable assurance about whether the consolidated financial statements are free from

Page 2

Opinion In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of Ontario Genomics Institute as at March 31, 2014, and its consolidated results of operations and its consolidated cash flows for the year then ended in accordance with Canadian accounting standards for not-for-profit organizations. Report on Other Legal and Regulatory Requirements As required by the Canada Corporations Act, we report that, in our opinion, the accounting policies applied in preparing and presenting the consolidated financial statements in accordance with Canadian accounting standards for not-for-profit organizations have been applied on a basis consistent with that of the preceding year.

Chartered Professional Accountants, Licensed Public Accountants July 3, 2014 Toronto, Canada

material Auditors'misstatement. Responsibility

An involves performing procedures to on obtain audit evidence about the statements amounts and disclosures Ouraudit responsibility is to express an opinion these consolidated financial based on our in the consolidated financial statements. The procedures selected depend on our judgment, including audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. the assessment of the risks of comply materialwith misstatement of the consolidated Those standards require that we ethical requirements and plan andfinancial perform statements, the audit to whether due to fraud or error.about In making risk assessments, westatements consider internal obtain reasonable assurance whetherthose the consolidated financial are freecontrol from relevant to the entity's preparation and fair presentation of the consolidated financial statements in material misstatement. order to design audit procedures that are appropriate in the circumstances, but not for the purpose of An audit involves performing to obtain evidence about the amounts and disclosures expressing an opinion on theprocedures effectiveness of theaudit entity's internal control. An audit also includes in the consolidated financial statements. The procedures selected depend on our judgment, including evaluating the appropriateness of accounting policies used and the reasonableness of accounting the assessment of management, the risks of material misstatement of overall the consolidated statements, estimates made by as well as evaluating the presentationfinancial of the consolidated whether due to fraud or error. In making those risk assessments, we consider internal control financial statements. relevant to the entity's preparation and fair presentation of the consolidated financial statements in We thataudit the audit evidence weare have obtainedinis the sufficient and appropriate a basis orderbelieve to design procedures that appropriate circumstances, but not to forprovide the purpose of for our auditan opinion. expressing opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. KPMG LLP is a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative

ONTARIO GENOMICS INSTITUTE

March 31, 2014, with comparative information for 2013

Year ended March 31, 2014, with comparative information for 2013

Consolidated Statement of Operations

Consolidated Statement of Financial Position

2014

Revenue: Amortization of deferred contributions (note 5) Interest and other revenue

Assets Current assets: Cash Accounts receivable (note 2) Deposits and prepaid expenses

$ 1,375,256 1,016,045 97,999 2,489,300

$ 2,849,621 270,900 80,048 3,200,569

25,589

42,734

$ 2,514,889

$ 3,243,303

Capital assets (note 3)

Liabilities and Net Assets

Deferred contributions (note 5) Net assets: Internally restricted (note 6) Unrestricted

239,244 784,005 1,023,249

273,545 380,895 654,440

–

1,097,223

25,589 1,466,051 1,491,640

42,734 1,448,906 1,491,640

$ 22,034,915 331,513 22,366,428

$ 17,627,632 117,220 17,744,852

19,180,448 1,043,590 1,070,999 386,283 666,095 19,013 22,366,428

14,089,091 1,168,036 1,033,422 963,739 474,668 15,896 17,744,852

–

See accompanying notes to consolidated financial statements.

ONTARIO GENOMICS INSTITUTE Consolidated Statement of Changes in Net Assets

Year ended March 31, 2014, with comparative information for 2013

Commitments (note 8) $ 2,514,889

2013

Expenses: Research projects Business development General and administrative Research programs management Outreach and communications Amortization of capital assets Excess of revenue over expenses

Current liabilities: Accounts payable and accrued liabilities (note 4) Amounts due to research projects

2014

2013

2014

2013

Unrestricted

Total

$ 1,448,906

$ 1,491,640

(19,013)

19,013

–

1,868

(1,868)

–

$ 1,491,640

Internally restricted (note 6)

$ 3,243,303

See accompanying notes to consolidated financial statements.

Net assets, beginning of year

On behalf of the Board:

Excess (deficiency) of revenue over expenses Director

Invested in capital assets

Director

Net assets, end of year

42,734

25,589

$ 1,466,051

See accompanying notes to consolidated financial statements.

ONTARIO GENOMICS INSTITUTE

Year ended March 31, 2014, with comparative information for 2013

Year ended March 31, 2014

Consolidated Statement of Cash Flows

Notes to Consolidated Financial Statements

2014

2013

Cash provided by (used in): Operations: Excess of revenue over expenses Items not involving cash: Amortization of deferred contributions Write-down of long-term advances Amortization of capital assets

Change in non-cash assets and liabilities: Accounts receivable Advances to research projects Amounts due to research projects Deposits and prepaid expenses Accounts payable and accrued liabilities Deferred contributions Investments: Purchase of capital assets Decrease in cash Cash, beginning of year Cash, end of year See accompanying notes to consolidated financial statements.

–

(22,034,915) – 19,013 (22,015,902)

(17,627,632) 275,000 15,896 (17,336,736)

(745,145) – 403,110 (17,951) (34,301) 20,937,692 (1,472,497)

(209,949) 1,946,461 380,895 7,267 12,465 14,200,026 (999,571)

(1,868)

(41,230)

(1,474,365)

(1,040,801)

2,849,621

3,890,422

1,375,256

2,849,621

The Ontario Genomics Institute (the "Corporation" or "OGI") was incorporated without share capital on October 18, 2000 under the Canada Corporations Act as a not-for-profit organization. OGI's role is to drive the life sciences industry in Ontario through the use of genomics to increase the quality of life for all Ontarians through better health outcomes, a healthier environment and sustainable agriculture. This is accomplished by concentrating on three strategic areas: (a)

through Business Development, to catalyze access to and the impact of research outcomes, helping scientists market their discoveries and the resulting products, and also work to ensure that access to leading-edge technologies makes genomics research in Ontario more competitive;

(b)

through Research Programs Management, to identify and cultivate emerging Ontario-led, pioneering research projects in genomics and related fields, and work with them to identify, attract, and support funding; and

(c)

through Outreach and Communications, to establish initiatives that increase awareness of genomics research and facilitate informed public dialogue about genomics and its impact on society.

Significant accounting policies: These financial statements are prepared in accordance with Canadian accounting standards for not-for-profit organizations. Significant accounting policies are as follows: (a) Subsidiaries: These consolidated financial statements include the results of OGI with those of the Corporation's wholly owned subsidiary, Genomics Ontario Inc. All significant intercompany accounts and transactions have been eliminated upon consolidation. (b) Revenue recognition: The Corporation follows the deferral method of accounting for contributions, which include funds from Genome Canada and the Government of Ontario through the Ministry of Research and Innovation/Ministry of Economic Development, Trade and Employment. Unrestricted contributions are recognized as revenue when received or receivable if the amount to be received can be reasonably estimated and collection is reasonably assured.

ONTARIO GENOMICS INSTITUTE

Year ended March 31, 2014

Notes to Consolidated Financial Statements (continued)

Significant accounting policies (continued):

Notes to Consolidated Financial Statements (continued)

Externally restricted contributions are recognized as revenue in the year in which the related expenses are incurred. Investment income earned on unspent externally restricted contributions is recognized in the year in which it is earned.

(e) Capital assets: Capital assets are recorded at cost less accumulated amortization. Leasehold improvements are amortized on a straight-line basis over the lesser of estimated useful life or the term of the lease. Furniture and fixtures are amortized on a straight-line basis over five years. Computer equipment is amortized on a straight-line basis over three years.

(c) Advances to/amounts due to research projects: Advances to research projects comprise amounts provided by the Corporation to approved research projects which have not been expensed. Amounts due to research projects comprise amounts payable by the Corporation to projects for expenses already approved and incurred.

(f) Use of estimates: The preparation of consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the year. Amounts subject to significant estimates and assumptions include the carrying value of capital assets, fair value of accrued liabilities. Actual results could differ from those estimates.

(d) Financial instruments: Financial instruments are recorded at fair value on initial recognition. Freestanding derivative instruments that are not in a qualifying hedging relationship and equity instruments that are quoted in an active market are subsequently measured at fair value. All other financial instruments are subsequently recorded at cost or amortized cost, unless management has elected to carry the instruments at fair value. The Corporation has not elected to carry any such financial instruments at fair value. Transaction costs incurred on the acquisition of financial instruments measured subsequently at fair value are expensed as incurred. All other financial instruments are adjusted by transaction costs incurred on acquisition and financing costs, which are amortized using the straight-line method. Financial assets are assessed for impairment on an annual basis at the end of the fiscal year if there are indicators of impairment. If there is an indicator of impairment, the Corporation determines if there is a significant adverse change in the expected amount or timing of future cash flows from the financial asset. If there is a significant adverse change in the expected cash flows, the carrying value of the financial asset is reduced to the highest of the present value of the expected cash flows, the amount that could be realized from selling the financial asset or the amount the Corporation expects to realize by exercising its right to any collateral. If events and circumstances reverse in a future period, an impairment loss will be reversed to the extent of the improvement, not exceeding the initial impairment charge.

Significant accounting policies (continued):

(g) Foreign exchange: The Corporation's assets and liabilities denominated in foreign currencies are translated into Canadian dollars using exchange rates in effect at the consolidated statement of financial position date. Revenue and expense items are translated at the rate of exchange prevailing on the date of the transaction. 2.

Accounts receivable:

Grants receivable Harmonized sales tax Interest and other

2014

2013

966,111 44,660 5,274

$ 216,041 42,079 12,780

$ 1,016,045

$ 270,900

ONTARIO GENOMICS INSTITUTE

Year ended March 31, 2014

Notes to Consolidated Financial Statements (continued)

Capital assets:

Cost Furniture and fixtures Computer equipment

72,166 54,580

$ 126,746

2014 Net book value

Accumulated amortization $

The Corporation receives funding from Genome Canada, the Government of Ontario through the Ministry of Research and Innovation and other parties to be administrated and distributed in accordance with the related funding agreements.

2013 Net book value

67,480 33,677

4,686 20,903

6,127 36,607

$ 101,157

25,589

42,734

Deferred contributions related to expenses of future periods represent unspent externally restricted funding to be used for the purposes of providing funds to eligible recipients and the payment of operating and capital expenditures in future periods. The changes in the deferred contributions balances are as follows:

Accounts payable and accrued liabilities:

Accrued liabilities Accounts payable Deferred rent

Deferred contributions:

2014

2013

$ 161,881 77,363 –

$ 141,927 120,500 11,118

$ 239,244

$ 273,545

2014 Opening balance Contributions received or receivable during the year: Genome Canada - Research Genome Canada - Operations Government of Ontario - Operations Government of Ontario - Research

Deferred rent represents a rent-free period provided annually to the Corporation by its lessor. The amount is deferred and is recorded as a decrease in rent expense on a straight-line basis. Included in accounts payable and accrued liabilities are government remittances payable of $43,898 (2013 - $32,177), which includes amounts payable for payroll-related taxes and harmonized sales taxes.

Amount amortized to revenue $

301,724,762

2013 $

287,524,736

17,898,711 1,308,981 500,000 1,230,000 322,662,454

11,845,602 1,354,424 1,000,000 – 301,724,762

(322,662,454)

(300,627,539)

–

1,097,223

Internally restricted net assets: Internally restricted net assets represent net assets invested in capital assets.

ONTARIO GENOMICS INSTITUTE

Year ended March 31, 2014

Notes to Consolidated Financial Statements (continued)

Financial risks and risk management: The Corporation considers its total assets to be its capital. The Corporation's objectives in managing capital are to safeguard the assets and maintain liquidity.

Notes to Consolidated Financial Statements (continued)

Commitments: (a) Funding: The Corporation has committed to the following:

(a) Liquidity risk: Commitments

Liquidity risk is the risk that the Corporation will be unable to fulfill its obligations in a timely basis or at a reasonable cost. The Corporation manages its liquidity risk by monitoring actual and projected cash disbursements against funding received or to be received from operations. The Corporation prepares budgets and cash forecasts to ensure it has sufficient funds to fulfill its obligations. (b) Credit risk: Credit risk refers to the risk that a counterparty may default on its contractual obligations, resulting in a financial loss. The Corporation is exposed to credit risk with respect to the accounts receivable. The Corporation manages its credit risk by assessing accounts receivable on a continuous basis. The Corporation deals with creditworthy counterparties and seldom has doubtful accounts. (c) Interest rate risk: Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments. The Corporation is exposed to interest rate risk through the interest income it derives from the cash balance.

Less amount paid for Expenses Advances incurred (due to) (000's)

Applied Genomics Research in Bioproducts or Crops Competition 2010 Large-Scale Applied Research Project Competition 2012 Large-Scale Applied Research Project Competition 2012 Bioinformatics and Computational Biology Competition International Barcode of Life Project Science and Technology Innovation Centres International Consortium Initiatives ("ICI") Genomic Applications Partnership Program Round 1 Genomic Applications Partnership Program Round 2 NSERC Discovery Frontiers Program Personalized Medicine Pilot Project for Rheumatoid Arthritis

7,881

7,511

(55)

Residual commitments

425

11,306

8,055

3,190

6,417

956

1,290

4,171

2,119

468

1,574

15,890

13,336

4,032

1,914

2,091

51,286

43,113

–

8,173

3,481

–

3,481

4,435

–

4,435

2,000

–

2,000

3,690

1,245

(15)

2,460

$ 112,537

76,598

(2,445)

(1,060)

4,999

36,999

The effect of the excess/deficiency of revenue over expenses of an increase or decrease in interest rates is not significant. The Corporation believes that it is not exposed to significant liquidity risk, credit risk or interest rate risk arising from its financial instruments. There has been no significant change in exposures from 2013.

ONTARIO GENOMICS INSTITUTE ONTARIO GENOMICS INSTITUTE Notes to Consolidated Financial Statements (continued) ONTARIO GENOMICS INSTITUTE Notes to Consolidated Financial Statements (continued) ONTARIO GENOMICS INSTITUTE Notes to Consolidated Financial Statements (continued) ONTARIO GENOMICS Notes to to Consolidated Consolidated Financial Financial Statements StatementsINSTITUTE (continued) Notes (continued) Notes to Financial Statements Notes to Consolidated Consolidated Statements (continued) (continued) Year March 2014 Year ended ended March 31, 31, Financial 2014 Year ended March 31, 2014 Year ended March 31, 2014 Year ended March 31, 2014 Year ended ended March March 31, 31, 2014 2014 Year 8. 8. 8. 8. 8. 8. 8.

Commitments (continued): Commitments Commitments (continued): (continued): Commitments (continued): Commitments (continued): Commitments Commitments (continued): (continued): Genome Canada Canada has has entered entered into into an an agreement agreement with with the the Corporation Corporation regarding regarding financial financial Genome Genome Canada has into an agreement with the regarding financial Genome Canada Canada has entered entered into for an the agreement with the Corporation Corporation regarding financial Genome has entered into an agreement with the Corporation regarding financial commitments totalling $7,880,929 Applied Genomics Research in Bioproducts or commitments totalling $7,880,929 for the Applied Genomics Research in Bioproducts or Genome Canada has entered into an agreement with the Corporation regarding financial commitments totalling $7,880,929 for the Applied with Genomics Researchregarding in Bioproducts Bioproducts or Genome Canada has entered into for an the agreement the Corporation financial commitments totalling $7,880,929 Applied Genomics Research in or commitments totalling $7,880,929 for the Applied Genomics Research in Bioproducts or Crops Competition, $11,306,294 the 2010 Large-Scale Applied Research Project Crops Competition, $11,306,294 the 2010 Large-Scale Applied Research Project commitments totalling $7,880,929 for the Applied Genomics Research in Bioproducts or Crops Competition, $11,306,294 the Applied 2010 Large-Scale Large-Scale Applied Research Research Project commitments totalling$11,306,294 $7,880,929 for the Genomics Research in Bioproducts or Crops Competition, for the 2010 Applied Project Crops Competition, $11,306,294 for the 2010 Large-Scale Applied Research Project Competition, $6,416,631 for the 2012 Large-Scale Applied Research Project Competition, Competition, $6,416,631 for the the 2012 2012 Large-Scale Applied Research Research Project Competition, Crops Competition, $11,306,294 for the 2010 Large-Scale Applied Research Project Competition, $6,416,631 for Large-Scale Applied Project Competition, Crops Competition, $11,306,294 for the 2010 Large-Scale Applied Research Project Competition, $6,416,631 for the 2012 Large-Scale Applied Research Project Competition, Competition, $6,416,631 for the 2012 Large-Scale Research Project Competition, $2,119,257 for the 2012 2012 Bioinformatics and Applied Computational Biology $2,119,257 the Bioinformatics and Computational Competition, $6,416,631 for 2012 Applied Research Project $2,119,257 for the 2012 Bioinformatics and Computational Biology Competition, for $6,416,631 for the the 2012 Large-Scale Large-Scale Applied ResearchBiology Project Competition, Competition, $2,119,257 for the International 2012 Bioinformatics and Computational Biology Competition, $2,119,257 for the 2012 Bioinformatics and Computational Biology Competition, $15,890,000 for the Barcode of Life Project, $3,481,253 for the Genomic $15,890,000 for the International Barcode of Life Project, $3,481,253 for the Genomic $2,119,257 for the 2012 Bioinformatics and Computational Biology Competition, $15,890,000 for the the International Barcode of ofand Life Computational Project, $3,481,253 $3,481,253 for the the Genomic $2,119,257 for the International 2012 Bioinformatics Biology Competition, $15,890,000 for Barcode Life Project, for Genomic $15,890,000 for the International Barcode of Life Project, $3,481,253 for the Genomic Applications Partnership Program Round 1, $4,434,848 for the Genomic Applications Applications Partnership Program Round 1, $4,434,848 for the Genomic Applications $15,890,000 for the International Barcode of Life Project, $3,481,253 for the Genomic Applications Partnership Program Round 1, $4,434,848 for the Genomic Applications $15,890,000 Partnership for the International Barcode of $4,434,848 Life Project,for $3,481,253 for the Genomic Applications Program Round 1, the Genomic Applications Applications Partnership Program Round $4,434,848 for the Genomic Applications Program Round 2, and and $2,000,000 $2,000,000 for the the 1, NSERC Discovery Frontiers Program. Under Program Round 2, for NSERC Discovery Frontiers Program. Under Applications Partnership Program Round 1, $4,434,848 for the Genomic Applications Program Round 2, and $2,000,000 for the NSERC Discovery Frontiers Program. Under Applications Partnership Program Round 1, $4,434,848 for the Genomic Applications Program Round the 2, and and $2,000,000 for the the NSERC Discovery Frontiers Program. Under Program Round 2, $2,000,000 for NSERC Discovery Frontiers Program. Under the agreement, Corporation agreed, among other things, to obtain financial support the agreement, the Corporation agreed, among other things, to obtain financial support Program Round 2, and $2,000,000 for the NSERC Discovery Frontiers Program. Under the agreement, the Corporation agreed, among other things, Frontiers to obtain obtain Program. financial support support Program Round the 2, and $2,000,000 for the NSERC Discovery Under the agreement, Corporation agreed, among other things, to financial the agreement, the Corporation agreed, among other things, to obtain financial support from other parties. from other parties. the agreement, the Corporation agreed, among other things, to obtain financial support from other parties. parties. the agreement, the Corporation agreed, among other things, to obtain financial support from other from other parties. from from other other parties. parties. Genome Canada Canada has has entered entered into into an an agreement agreement with with the the Corporation Corporation regarding regarding financial financial Genome Genome Canada has entered agreement with the regarding financial Genome Canada Canada has $4,032,350 entered into intoforan anthe agreement withTechnology the Corporation Corporation regarding financial Genome has entered into an agreement with the Corporation regarding financial commitments totalling Science and Innovation Centres. commitments totalling $4,032,350 for the Science and Technology Innovation Centres. Genome Canada has entered into an agreement with the Corporation regarding financial commitments totalling $4,032,350 foranthe the Science and and Technology Innovation Centres. Genome Canada has $4,032,350 entered intofor agreement withTechnology the Corporation regarding financial commitments totalling Science Innovation Centres. commitments totalling $4,032,350 for the Science and Technology Innovation Centres. commitments totalling $4,032,350 for the Science and Technology Innovation Centres. commitments totalling $4,032,350 for the Science and Technology Innovation Centres. The Government of Ontario entered into an agreement with the Corporation regarding The Government of Ontario entered into an agreement with the Corporation regarding The Government of Ontario entered into an an agreement agreement with with the the Corporation Corporation regarding regarding The Government of Ontario entered into The Government of Ontario entered into an agreement with the Corporation regarding financial commitments totalling $3,690,000 for the Personalized Medicine Pilot Project in financial commitments totalling $3,690,000 for the Personalized Medicine Pilot Project in The Government of Ontario entered into an agreement with the Corporation regarding financial commitments totalling $3,690,000 for the Personalized Medicine Pilot Project The Government of Ontario entered into an agreement with the Corporation regarding financial commitments commitments totalling $3,690,000 $3,690,000 for for the the Personalized Personalized Medicine Medicine Pilot Pilot Project Project in in financial totalling in Rheumatoid Arthritis. Rheumatoid Arthritis. financial commitments totalling $3,690,000 for the Personalized Medicine Pilot Project Rheumatoid Arthritis. financial commitments totalling $3,690,000 for the Personalized Medicine Pilot Project in in Rheumatoid Arthritis. Rheumatoid Arthritis. Rheumatoid Rheumatoid Arthritis. Arthritis. Genome Canada has entered into an agreement with the Corporation, under which Genome Genome Canada Canada has has entered entered into into an an agreement agreement with with the the Corporation, Corporation, under under which which Genome Canada has entered into an agreement with the Corporation, under which has entered into an agreement with the Corporation, under which Genome Canada agreed to provide the Corporation with financial contributions up to to Genome Canada agreed to provide the Corporation with financial contributions up has into agreement with the Corporation, under Genome Canada agreed to provide the Corporation with contributions up has entered entered into an an agreement with thefinancial Corporation, under which which Genome Canada agreed to provide the Corporation with financial contributions up to to Genome Canada agreed to provide the Corporation with financial contributions up to $38,219,858 for disbursement disbursement to the the Structural Structural Genomics Consortium and $13,066,518 $38,219,858 for to Genomics Consortium and $13,066,518 Genome Canada agreed to provide the Corporation with financial contributions up $38,219,858 for to Structural Genomics Consortium $13,066,518 Genome Canada agreed to provide the Corporation with financial and contributions up to to $38,219,858 for disbursement disbursement to the the Structural Genomics Consortium and $13,066,518 to $38,219,858 for disbursement to the Structural Genomics Consortium and $13,066,518 to the Cancer Stem Cell Consortium, collectively referred to as the ICI. Under the agreement, the Cancer Cell collectively referred to as the agreement, $38,219,858 for to Structural Genomics and $13,066,518 to the Cancer Stem Stem Cell Consortium, Consortium, collectively referred to asConsortium the ICI. ICI. Under Under the agreement, $38,219,858 for disbursement disbursement to the the Structuralreferred Genomics Consortium and the $13,066,518 to the Cancer Stem Cell Consortium, collectively to as the ICI. Under the agreement, Cancer Stem Cell Consortium, collectively referred to as the ICI. Under the agreement, the Corporation disburses funds to the projects but expenditures are reported directly to the Corporation disburses funds to the projects but expenditures are reported directly to Cancer Stem Cell Consortium, collectively referred to as the ICI. Under the agreement, the Corporation disburses funds to the projects but expenditures are reported directly to Cancer Stem Cell Consortium, collectively referred to as the ICI. Under the agreement, the Corporation disburses funds to the projects but expenditures are reported directly to the Corporation Corporation disburses funds to Corporation the projects projects treats but expenditures expenditures areas reported directlyand to Genome Canada; therefore, theto Corporation these funds funds asreported unrestricted and Genome Canada; therefore, the these unrestricted the disburses funds the but are directly to Genome Canada; therefore, the treats these unrestricted the Corporation disburses funds the projects treats but expenditures areas directlyand to Genome Canada; therefore, theto Corporation Corporation treats these funds funds asreported unrestricted and Genome Canada; therefore, the Corporation treats these funds as unrestricted and expenses when they are disbursed. expenses when they are disbursed. Genome Canada; therefore, the Corporation treats these funds as unrestricted and expenses when they theytherefore, are disbursed. disbursed. Genome Canada; the Corporation treats these funds as unrestricted and expenses when are expenses when they are disbursed. expenses expenses when when they they are are disbursed. disbursed. During 2014, Genome with the During 2014, 2014, Genome Genome Canada Canada entered entered into into an an agreement agreement with with the Corporation, Corporation, under under During Canada entered into an agreement the Corporation, under During 2014, Genome Canada entered into an with the under During 2014, Genome Genome Canada entered into an agreement agreement with the Corporation, Corporation, under which Genome Canada agreed to provide the Corporation with financial contributionsunder up to to which Genome Canada agreed to provide the Corporation with financial contributions up During 2014, Canada entered into an agreement with the Corporation, which Genome Canada agreed to provide the Corporation with financial contributions up During 2014, Genome Canada entered into an agreement with the Corporation, which Genome Genome Canada agreed agreed to to provide provide the the Corporation Corporation with with financial financial contributions contributionsunder up to to which Canada up to $880,000 for operations. $880,000 for operations. which Genome Canada agreed to provide the Corporation with financial contributions up to $880,000 for operations. operations. which Genome Canada agreed to provide the Corporation with financial contributions up to $880,000 for $880,000 for operations. $880,000 for operations. $880,000 for operations. In fiscal 2012, OGI entered into an agreement with the Government of Ontario regarding In In fiscal fiscal 2012, 2012, OGI OGI entered entered into into an an agreement agreement with with the the Government Government of of Ontario Ontario regarding regarding In fiscal 2012, OGI entered into an agreement with the Government of Ontario regarding In fiscal 2012, OGI entered into an agreement with the Government of Ontario regarding the development of several translation projects. On March 28, 2014, an amending the development of several translation projects. On March 28, 2014, an amending In fiscal 2012, entered into an with Government of regarding the development several translation projects. On March 28, 2014, an amending In 2012, OGI OGIof into an agreement agreement with the the Government of Ontario Ontario regarding thefiscal development ofentered several translation projects. On March 28, 2014, an amending the development of several translation projects. On March 28, 2014, an amending agreement was signed whereby the Government of Ontario has agreed to provide up to agreement was signed whereby the Government of Ontario has agreed to provide up the development of several translation projects. On March 28, 2014, an amending agreement was signed signed whereby the Government Government of On Ontario has28, agreed to an provide up to to the development of several translation projects.of March 2014, amending agreement was whereby the Ontario has agreed to provide up to agreement was signed whereby the Government of Ontario has agreed to provide up to $6,000,000 to fund the development of these projects. The funding proceeds are to be $6,000,000 to the development of The funding proceeds are to to be agreement signed the of agreed to up to $6,000,000 to fund fund the whereby development of these these projects. projects. The has funding proceeds are be agreement was was signed whereby the Government Government of Ontario Ontario has agreed to provide provide up be to $6,000,000 to fund the development of these projects. The funding proceeds are to $6,000,000 to fund the development of these projects. The funding proceeds are to be paid out to OGI in installments, which are based upon the achievement of specific project paid out to to OGI OGI in installments, installments, which of arethese based upon the theThe achievement of specific specific project $6,000,000 to fund the development projects. funding proceeds areproject to be be paid out in which are based upon achievement of $6,000,000 to fund the development of these projects. The funding proceeds are to paid out to OGI in installments, which are based upon the achievement of specific project paid out to to OGI in installments, installments, which are are based upon the achievement achievement of specific specific project milestones as defined defined in the the agreement. agreement. As of of March 31, 2014, 2014, OGI OGI has received received milestones as in As March 31, has paid out in which upon the of project milestones as in As March 31, has paid out to OGI OGI in installments, which are based based upon the achievement of specific project milestones as defined defined in the the agreement. agreement. As of of March 31, 2014, 2014, OGI OGI has received received milestones as defined in the agreement. As of March 31, 2014, OGI has received $2,500,000 from the Government of Ontario under this agreement. $2,500,000 from the Government of Ontario under this agreement. milestones as defined in the agreement. As of March 31, 2014, OGI has received $2,500,000 from the Government Government of Ontario Ontario under under thisMarch agreement. milestones from as defined in the agreement. As of 31, 2014, OGI has received $2,500,000 the of this agreement. $2,500,000 from the Government of Ontario under this agreement. $2,500,000 $2,500,000 from from the the Government Government of of Ontario Ontario under under this this agreement. agreement.

ONTARIO GENOMICS INSTITUTE Notes to Consolidated Financial Statements (continued) Year ended March 31, 2014

Commitments (continued): (b) Operating lease: The Corporation has entered into operating lease agreement for premises. The anticipated annual payments in each of the next five years and thereafter are as follows:

2015 2016 2017 2018 2019 Thereafter

137,676 117,500 117,500 117,500 117,500 947,050

$ 1,554,726

Ontario Genomics Institute MaRS Centre, West Tower, 661 University Ave, Suite 490, Toronto, Ontario M5G 1M1 416.977.9582 | info@OntarioGenomics.ca www.OntarioGenomics.ca | www.scintelligence.ca