---



(formerly Stem Cell Therapeutics Corp.)

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

96 Skyway Avenue Toronto, Ontario M9W 4Y9
www.trilliumtherapeutics.com

---

INDEPENDENT AUDITORS REPORT OF REGISTERED PUBLIC ACCOUNTING
FIRM

To the Shareholders ofTrillium Therapeutics Inc.

We have audited the accompanying consolidated financial
statements of Trillium Therapeutics Inc. which comprise the consolidated
statements of financial position as at December 31, 2015 and 2014, and the
consolidated statements of loss and comprehensive loss, changes in equity and
cash flows for the years then ended, and a summary of significant accounting
policies and other explanatory information.

Managements responsibility for the consolidated financial
statements

Management is responsible for the preparation and fair
presentation of these consolidated financial statements in accordance with
International Financial Reporting Standards, as issued by the International
Accounting Standards Board, and for such internal control as management
determines is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to fraud or
error.

Auditors responsibility

Our responsibility is to express an opinion on these
consolidated financial statements based on our audits. We conducted our audits
in accordance with Canadian generally accepted auditing standards and the
standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we comply with ethical requirements and plan and
perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free from material misstatement. We were not engaged to
perform an audit of the Companys internal control over financial reporting. Our
audits included consideration of internal control over financial reporting as a
basis for designing audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the
Companys internal control over financial reporting. Accordingly, we express no
such opinion.

An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the consolidated financial
statements. The procedures selected depend on the auditors judgment, including
the assessment of the risks of material misstatement of the consolidated
financial statements, whether due to fraud or error. An audit also includes, on
a test basis, evidence supporting the amounts and disclosures in the
consolidated financial statements, 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 in our
audits is sufficient and appropriate to provide a basis for our audit
opinion.

Opinion

In our opinion, the consolidated financial statements present
fairly, in all material respects, the financial position of Trillium
Therapeutics Inc. as at December 31, 2015 and 2014, and its financial
performance and its cash flows for the years then ended in accordance with
International Financial Reporting Standards, as issued by the International
Accounting Standards Board.

|                | /s/ Ernst & Young LLP             
|--------------- | ----------------------------------
|Toronto, Canada | Chartered Professional Accountants
|March 9, 2016   | Licensed Public Accountants       

---

|TRILLIUM THERAPEUTICS INC.                   
|---------------------------------------------
|                                             
|Consolidated Statements of Financial Position
|Amounts in
      Canadian Dollars            

|                                               |  |      |  |  | As at             |   |  | As at             |  
|---------------------------------------------- |  | ---- |  |  | ----------------- | - |  | ----------------- | -
|                                               |  | Note |  |  | December 31, 2015 |   |  | December 31, 2014 |  
|                                               |  |      |  |  | **$**             |   |  | $                 |  
|                                               |  |      |  |  |                   |   |  |                   |  
|                                               |  |      |  |  |                   |   |  |                   |  
|ASSETS                                         |  |      |  |  |                   |   |  |                   |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Current                                        |  |      |  |  |                   |   |  |                   |  
|Cash                                           |  |      |  |  | 86,770,542        |   |  | 26,165,056        |  
|Amounts receivable                             |  | 4    |  |  | 974,822           |   |  | 344,416           |  
|Prepaid expenses                               |  |      |  |  | 1,181,481         |   |  | 1,008,225         |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Total current assets                           |  |      |  |  | 88,926,845        |   |  | 27,517,697        |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Property and equipment                         |  | 5    |  |  | 897,390           |   |  | 235,402           |  
|Intangible assets                              |  | 6    |  |  | 93,585            |   |  | 432,933           |  
|Other assets                                   |  |      |  |  | 121,648           |   |  | -                 |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Total non-current assets                       |  |      |  |  | 1,112,623         |   |  | 668,335           |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Total assets                                   |  |      |  |  | 90,039,468        |   |  | 28,186,032        |  
|                                               |  |      |  |  |                   |   |  |                   |  
|LIABILITIES                                    |  |      |  |  |                   |   |  |                   |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Current                                        |  |      |  |  |                   |   |  |                   |  
|Accounts payable and accrued
      liabilities |  | 7    |  |  | 3,233,749         |   |  | 3,248,984         |  
|Other current liabilities                      |  | 8    |  |  | 323,151           |   |  | 279,461           |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Total current liabilities                      |  |      |  |  | 3,556,900         |   |  | 3,528,445         |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Loan payable                                   |  | 8    |  |  | 270,386           |   |  | 283,352           |  
|Deferred lease inducement                      |  | 8    |  |  | 348,205           |   |  | -                 |  
|Long-term liability                            |  | 8    |  |  | 60,109            |   |  | 69,941            |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Total non-current liabilities                  |  |      |  |  | 678,700           |   |  | 353,293           |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Total liabilities                              |  |      |  |  | 4,235,600         |   |  | 3,881,738         |  
|                                               |  |      |  |  |                   |   |  |                   |  
|EQUITY                                         |  |      |  |  |                   |   |  |                   |  
|Common shares                                  |  | 9    |  |  | 103,340,072       |   |  | 49,505,792        |  
|Series I preferred shares                      |  | 9    |  |  | 7,797,773         |   |  | 10,076,151        |  
|Series II preferred shares                     |  | 9    |  |  | 24,369,384        |   |  | -                 |  
|Warrants                                       |  | 9    |  |  | 6,926,019         |   |  | 9,283,332         |  
|Contributed surplus                            |  | 9    |  |  | 8,660,355         |   |  | 5,995,055         |  
|Deficit                                        |  |      |  |  | (65,289,735       | ) |  | (50,556,036       | )
|                                               |  |      |  |  |                   |   |  |                   |  
|Total equity                                   |  |      |  |  | 85,803,868        |   |  | 24,304,294        |  
|                                               |  |      |  |  |                   |   |  |                   |  
|Total liabilities and equity                   |  |      |  |  | 90,039,468        |   |  | 28,186,032        |  

|Commitments and contingencies [note 14]                                |                                 
|---------------------------------------------------------------------- | --------------------------------
|                                                                       |                                 
|Approved by the Board and authorized for issue on March 9,
      2016: |                                 
|                                                                       |                                 
|(signed) Luke Beshar, Director                                         | (signed) Henry Friesen, Director

See accompanying notes to the consolidated financial
statements

- 1 -

---

|TRILLIUM THERAPEUTICS INC.                                  
|------------------------------------------------------------
|                                                            
|Consolidated Statements of Loss and Comprehensive
      Loss
|Amounts in
      Canadian Dollars                           

|                                             |  |          |     |  | Year ended        |   |  | Year ended        |  
|-------------------------------------------- |  | -------- | --- |  | ----------------- | - |  | ----------------- | -
|                                             |  | **Note** |     |  | December 31, 2015 |   |  | December 31, 2014 |  
|                                             |  |          |     |  | **$**             |   |  | $                 |  
|                                             |  |          |     |  |                   |   |  |                   |  
|EXPENSES                                     |  |          |     |  |                   |   |  |                   |  
|Research and development                     |  | 11       |     |  | 18,050,091        |   |  | 10,595,808        |  
|General and administrative                   |  | 12       |     |  | 3,184,347         |   |  | 2,577,460         |  
|                                             |  |          |     |  |                   |   |  |                   |  
|Operating expenses                           |  |          |     |  | 21,234,438        |   |  | 13,173,268        |  
|                                             |  |          |     |  |                   |   |  |                   |  
|Finance income                               |  | 13       |     |  | (6,595,189        | ) |  | (378,692          | )
|Finance costs                                |  | 13       |     |  | 84,948            |   |  | 87,244            |  
|                                             |  |          |     |  |                   |   |  |                   |  
|Net
      finance income                     |  |          |     |  | (6,510,241        | ) |  | (291,448          | )
|                                             |  |          |     |  |                   |   |  |                   |  
|Net loss before income taxes                 |  |          |     |  | 14,724,197        |   |  | 12,881,820        |  
|                                             |  |          |     |  |                   |   |  |                   |  
|Current income tax expense                   |  | 10       |     |  | 9,502             |   |  | -                 |  
|                                             |  |          |     |  |                   |   |  |                   |  
|Net loss and comprehensive loss for the year |  |          |     |  | 14,733,699        |   |  | 12,881,820        |  
|                                             |  |          |     |  |                   |   |  |                   |  
|Basic and diluted loss per common share      |  | 9        | (c) |  | (2.22             | ) |  | (3.06             | )

See accompanying notes to the consolidated financial
statements

- 2 -

---

|TRILLIUM THERAPEUTICS INC.                  
|--------------------------------------------
|                                            
|Consolidated Statements of Changes in Equity
|Amounts in
      Canadian Dollars           

|                                                                             |  | Common
      shares |  |  | Series I
      preferred shares |   |  | Series II
      preferred shares |   |  | Warrants   |   |  | Contributed |  |  |            |   |  |             |  
|---------------------------------------------------------------------------- |  | ------------------- |  |  | ------------------------------- | - |  | -------------------------------- | - |  | ---------- | - |  | ----------- |  |  | ---------- | - |  | ----------- | -
|                                                                             |  | Number              |  |  | Amount                          |   |  | Number                           |   |  | Amount     |   |  | Number      |  |  | Amount     |   |  | Number      |  
|                                                                             |  | #                   |  |  | $                               |   |  | #                                |   |  | $          |   |  | #           |  |  | $          |   |  | #           |  
|                                                                             |  |                     |  |  | (note 9                         | ) |  |                                  |   |  | (note 9    | ) |  |             |  |  | (note 9    | ) |  |             |  
|                                                                             |  |                     |  |  |                                 |   |  |                                  |   |  |            |   |  |             |  |  |            |   |  |             |  
|Balance, December 31, 2014                                                   |  | 4,427,244           |  |  | 49,505,792                      |   |  | 69,504,689                       |   |  | 10,076,151 |   |  | -           |  |  | -          |   |  | 138,724,781 |  
|                                                                             |  |                     |  |  |                                 |   |  |                                  |   |  |            |   |  |             |  |  |            |   |  |             |  
|Net loss and
      comprehensive loss for the period                         |  | -                   |  |  | -                               |   |  | -                                |   |  | -          |   |  | -           |  |  | -          |   |  | -           |  
|Transactions with owners of the
      Company, recognized directly in equity |  |                     |  |  |                                 |   |  |                                  |   |  |            |   |  |             |  |  |            |   |  |             |  
|Shares
      issued,   net of issue costs                                    |  | 1,750,754           |  |  | 39,592,240                      |   |  | -                                |   |  | -          |   |  | 1,077,605   |  |  | 24,369,384 |   |  | -           |  
|Exercise of warrants                                                         |  | 1,087,603           |  |  | 11,872,467                      |   |  | -                                |   |  | -          |   |  | -           |  |  | -          |   |  | (32,628,425 | )
|Exercise of stock
      options                                              |  | 6,666               |  |  | 91,195                          |   |  | -                                |   |  | -          |   |  | -           |  |  | -          |   |  | -           |  
|Conversion of preferred shares                                               |  | 523,870             |  |  | 2,278,378                       |   |  | (15,716,110                      | ) |  | (2,278,378 | ) |  | -           |  |  | -          |   |  | -           |  
|Share-based compensation                                                     |  | -                   |  |  | -                               |   |  | -                                |   |  | -          |   |  | -           |  |  | -          |   |  | -           |  
|Total transactions with owners of the Company                                |  | 3,368,893           |  |  | 53,834,280                      |   |  | (15,716,110                      | ) |  | (2,278,378 | ) |  | 1,077,605   |  |  | 24,369,384 |   |  | (32,628,425 | )
|Balance, December 31, 2015                                                   |  | **7,796,137**       |  |  | **103,340,072**                 |   |  | 53,788,579                       |   |  | 7,797,773  |   |  | 1,077,605   |  |  | 24,369,384 |   |  | 106,096,356 |  

|                                                                             |  | Common
      shares |  |  | Series I
      preferred shares |  |  | Warrants   |   |  | Contributed |   |  |             |   |  |           |  
|---------------------------------------------------------------------------- |  | ------------------- |  |  | ------------------------------- |  |  | ---------- | - |  | ----------- | - |  | ----------- | - |  | --------- | -
|                                                                             |  | Number              |  |  | Amount                          |  |  | Number     |   |  | Amount      |   |  | Number      |   |  | Amount    |  
|                                                                             |  | #                   |  |  | $                               |  |  | #          |   |  | $           |   |  | #           |   |  | $         |  
|                                                                             |  |                     |  |  |                                 |  |  |            |   |  |             |   |  |             |   |  |           |  
|Balance, December 31, 2013                                                   |  | 4,058,408           |  |  | 47,191,303                      |  |  | 77,895,165 |   |  | 11,292,525  |   |  | 142,230,123 |   |  | 9,818,179 |  
|                                                                             |  |                     |  |  |                                 |  |  |            |   |  |             |   |  |             |   |  |           |  
|Net loss and
      comprehensive loss for the period                         |  | -                   |  |  | -                               |  |  | -          |   |  | -           |   |  | -           |   |  | -         |  
|Transactions with owners of the
      Company, recognized directly in equity |  |                     |  |  |                                 |  |  |            |   |  |             |   |  |             |   |  |           |  
|Exercise of warrants                                                         |  | 86,540              |  |  | 1,065,015                       |  |  | -          |   |  | -           |   |  | (2,596,251  | ) |  | (118,202  | )
|Exercise of stock options                                                    |  | 2,614               |  |  | 33,100                          |  |  | -          |   |  | -           |   |  | -           |   |  | -         |  
|Conversion of
      preferred shares                                         |  | 279,682             |  |  | 1,216,374                       |  |  | (8,390,476 | ) |  | (1,216,374  | ) |  | -           |   |  | -         |  
|Expiry of warrants                                                           |  | -                   |  |  | -                               |  |  | -          |   |  | -           |   |  | (909,091    | ) |  | (416,645  | )
|Share-based compensation                                                     |  | -                   |  |  | -                               |  |  | -          |   |  | -           |   |  | -           |   |  | -         |  
|Total transactions with owners of the Company                                |  | 368,836             |  |  | 2,314,489                       |  |  | (8,390,476 | ) |  | (1,216,374  | ) |  | (3,505,342  | ) |  | (534,847  | )
|Balance, December 31, 2014                                                   |  | **4,427,244**       |  |  | 49,505,792                      |  |  | 69,504,689 |   |  | 10,076,151  |   |  | 138,724,781 |   |  | 9,283,332 |  

See accompanying notes to the consolidated financial
statements

- 3 -

---

|TRILLIUM THERAPEUTICS INC.           
|-------------------------------------
|                                     
|Consolidated Statements of Cash Flows
|Amounts in
      Canadian Dollars    

|                                                      |  |      |  |  | Year ended        |   |  | Year ended        |  
|----------------------------------------------------- |  | ---- |  |  | ----------------- | - |  | ----------------- | -
|                                                      |  | Note |  |  | December 31, 2015 |   |  | December 31, 2014 |  
|                                                      |  |      |  |  | **$**             |   |  | $                 |  
|                                                      |  |      |  |  |                   |   |  |                   |  
|OPERATING ACTIVITIES                                  |  |      |  |  |                   |   |  |                   |  
|Net loss for the year                                 |  |      |  |  | (14,733,699       | ) |  | (12,881,820       | )
|Adjustments for items not
      affecting cash        |  |      |  |  |                   |   |  |                   |  
|Share-based
      compensation                        |  | 9    |  |  | 2,706,500         |   |  | 2,311,254         |  
|Interest accretion                                    |  | 8,13 |  |  | 73,391            |   |  | 69,770            |  
|Amortization of
      intangible assets               |  | 6,11 |  |  | 339,348           |   |  | 610,776           |  
|Impairment of intangible assets                       |  | 6,11 |  |  | -                 |   |  | 429,763           |  
|Depreciation of
      property and equipment          |  | 5,11 |  |  | 118,394           |   |  | 47,208            |  
|Non-cash change in deferred lease inducement          |  |      |  |  | 105,805           |   |  | -                 |  
|Unrealized foreign exchange gain                      |  |      |  |  | (6,010,996        | ) |  | -                 |  
|                                                      |  |      |  |  | (17,401,257       | ) |  | (9,413,049        | )
|Changes in non-cash working capital balances          |  |      |  |  |                   |   |  |                   |  
|Amounts receivable                                    |  |      |  |  | (630,406          | ) |  | 82,818            |  
|Prepaid expenses                                      |  |      |  |  | (173,256          | ) |  | (913,656          | )
|Accounts payable and accrued liabilities              |  |      |  |  | (15,235           | ) |  | 2,579,124         |  
|Other current
      liabilities                       |  |      |  |  | 43,690            |   |  | 216,695           |  
|Increase in other assets                              |  |      |  |  | (121,648          | ) |  | -                 |  
|Cash used in operating activities                     |  |      |  |  | (18,298,112       | ) |  | (7,448,068        | )
|                                                      |  |      |  |  |                   |   |  |                   |  
|INVESTING ACTIVITIES                                  |  |      |  |  |                   |   |  |                   |  
|Purchase of property and
      equipment              |  | 5    |  |  | (750,382          | ) |  | (173,603          | )
|Net
      change in marketable securities             |  |      |  |  | -                 |   |  | 526,598           |  
|Cash provided by (used) in investing activities       |  |      |  |  | (750,382          | ) |  | 352,995           |  
|                                                      |  |      |  |  |                   |   |  |                   |  
|FINANCING ACTIVITIES                                  |  |      |  |  |                   |   |  |                   |  
|Change in loan payable                                |  | 8    |  |  | (68,761           | ) |  | (115,031          | )
|Receipt of deferred lease
      inducement            |  | 8    |  |  | 212,400           |   |  | -                 |  
|Change in long-term liability                         |  | 8    |  |  | (27,428           | ) |  | (47,759           | )
|Issue of share capital, net of issuance costs         |  | 9    |  |  | 73,526,773        |   |  | 966,413           |  
|Cash provided by financing activities                 |  |      |  |  | 73,642,984        |   |  | 803,623           |  
|                                                      |  |      |  |  |                   |   |  |                   |  
|Impact of foreign exchange rate on cash               |  |      |  |  | 6,010,996         |   |  | -                 |  
|Net increase (decrease) in
      cash during the year |  |      |  |  | 60,605,486        |   |  | (6,291,450        | )
|                                                      |  |      |  |  |                   |   |  |                   |  
|Cash, beginning of year                               |  |      |  |  | 26,165,056        |   |  | 32,456,506        |  
|                                                      |  |      |  |  |                   |   |  |                   |  
|Cash, end of year                                     |  |      |  |  | 86,770,542        |   |  | 26,165,056        |  
|                                                      |  |      |  |  |                   |   |  |                   |  
|Supplemental cash flow
      information              |  |      |  |  |                   |   |  |                   |  
|                                                      |  |      |  |  |                   |   |  |                   |  
|Preferred shares converted to common shares (note 9)  |  |      |  |  | 2,278,378         |   |  | 1,216,374         |  

See accompanying notes to the consolidated financial
statements

- 4 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|1. | Corporate information
|-- | ---------------------

Trillium Therapeutics Inc. (the
Company or Trillium) is a Canadian public immuno-oncology company developing
innovative therapies for the treatment of cancer. The Company was incorporated
under the laws of the Province of Alberta on March 31, 2004 with nominal share
capital and filed Articles of Continuance to change its jurisdiction to Ontario
on November 7, 2013. On June 1, 2014, the Company amalgamated with its
wholly-owned subsidiary Trillium Therapeutics Inc. (Trillium Privateco) and
changed its name from Stem Cell Therapeutics Corp. to Trillium Therapeutics Inc.

The Companys head office is located at
96 Skyway Avenue, Toronto, Ontario, M9W 4Y9 and is listed on the Toronto Stock
Exchange under the symbol TR and on the NASDAQ Stock Exchange under the symbol
TRIL.

|2. | Basis of presentation
|-- | ---------------------

|(a) | Statement of compliance
|--- | -----------------------

The consolidated financial statements
have been prepared in accordance with International Financial Reporting
Standards (IFRS), as issued by the International Accounting Standards Board
(IASB).

These consolidated financial statements
were approved by the Companys Board of Directors on March 9, 2016.

|(b) | Basis of measurement
|--- | --------------------

These consolidated financial statements
have been prepared on the historical cost basis, except for held-for-trading
financial assets which are measured at fair value.

|(c) | Functional and presentation
  currency
|--- | --------------------------------------

These consolidated financial statements
are presented in Canadian dollars, which is the Company's functional
currency.

|(d) | Use of significant estimates and
  assumptions
|--- | ----------------------------------------------

The preparation of financial statements
in conformity with IFRS requires management to make judgments, estimates and
assumptions that affect the application of accounting policies and the reported
amounts of assets and liabilities, revenue and expenses and the related
disclosures of contingent assets and liabilities and the determination of the
Companys ability to continue as a going concern. Actual results could differ
materially from these estimates and assumptions. The Company reviews its
estimates and underlying assumptions on an ongoing basis. Revisions are
recognized in the period in which the estimates are revised and may impact
future periods.

Management has applied significant
estimates and assumptions to the following:

Valuation of share-based compensation
and warrants

Management measures the costs for
share-based compensation and warrants using market-based option valuation
techniques. Assumptions are made and estimates are used in applying the
valuation techniques. These include estimating the future volatility of the
share price, expected dividend yield, expected risk-free interest rate, future
employee turnover rates, future exercise behaviours and corporate performance.
Such estimates and assumptions are inherently uncertain. Changes in these
assumptions affect the fair value estimates of share-based payments and
warrants.

- 5 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|2. | Basis of presentation
(continued)
|-- | ---------------------------------

Impairment of long lived assets

Long-lived assets are reviewed for
impairment upon the occurrence of events or changes in circumstances indicating
that the carrying value of the asset may not be recoverable. For the purpose of
measuring recoverable amounts, assets are grouped at the lowest levels for which
there are separately identifiable cash flows (cash-generating units). The
recoverable amount is the higher of an assets fair value less costs to sell and
value in use (being the present value of the expected future cash flows of the
relevant asset or cash-generating unit). An impairment loss is recognized for
the amount by which the assets carrying amount exceeds its recoverable amount.
Management evaluates impairment losses for potential reversals when events or
circumstances warrant such consideration.

Intangible assets

The Company estimates the useful lives
of intangible assets from the date they are available for use in the manner
intended by management and at least annually reviews the useful lives to reflect
management's intent about developing and commercializing the assets.

|3. | Significant accounting
policies
|-- | -------------------------------

The accounting policies set out below
have been applied consistently to all periods presented in these consolidated
financial statements.

|(a) | Basis of consolidation
|--- | ----------------------

These consolidated financial statements
include the accounts of the Company and its wholly-owned subsidiaries, Stem Cell
Therapeutics Inc. to the date of its dissolution on September 17, 2014, and
Trillium Privateco from April 9, 2013, the date of acquisition to the date of
its amalgamation with the Company on June 1, 2014.

Investments in entities where the
Company is exposed, or has rights, to variable returns from its involvement with
the investee and has the ability to affect those returns through its power over
the investee, are considered subsidiaries due to the control exercised over the
investee by the Company. Subsidiaries are fully consolidated from the date at
which control is determined to have occurred and are de-consolidated from the
date that the Company no longer controls the entity. The financial statements of
the subsidiaries are prepared for the same reporting period as the Company,
using consistent accounting policies. Intercompany transactions, balances and
unrealized gains and losses on transactions between subsidiaries are
eliminated.

|(b) | Foreign currency
|--- | ----------------

Transactions in foreign currencies are
translated to the functional currency at the rate on the date of the
transactions. Monetary assets and liabilities denominated in foreign currencies
are retranslated at the spot rate of exchange as at the reporting date. All
differences are taken to profit or loss. Non-monetary items that are measured in
terms of historical cost in a foreign currency are translated using the exchange
rate as at the date of the initial transaction. Non-monetary items measured at
fair value in a foreign currency are translated using the exchange rate at the
date when the fair value was determined.

- 6 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

|(c) | Financial instruments
|--- | ---------------------

Financial assets

A financial asset is classified at fair
value through profit or loss if it is held for trading or is designated as such
upon initial recognition. Attributable transaction costs are recognized in
profit or loss as incurred. Financial assets at fair value through profit or
loss are measured at fair value and changes therein are recognized in profit or
loss.

Loans and receivablesLoans
and receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. Loans and receivables are
initially recognized at fair value plus transaction costs and subsequently
measured at amortized cost using the effective interest rate method less any
impairment losses. The Company has classified its amounts receivable as loans
and receivables.

DerecognitionA financial
asset is derecognized when the rights to receive cash flows from the asset have
expired or when the Company has transferred its rights to receive cash flows
from the asset.

Financial liabilities

Financial liabilities are recognized
initially at fair value plus any directly attributable transaction costs, and
subsequently at amortized cost using the effective interest method. The Company
has classified its accounts payable and accrued liabilities, and loan payable as
financial liabilities.

DerecognitionA financial
liability is derecognized when its contractual obligations are discharged,
cancelled or expired.

Equity

Common shares, preferred shares and
warrants to purchase common shares are classified as equity. Incremental costs
directly attributable to the issue of common shares, preferred shares and
warrants are recognized as a deduction from equity, net of any tax effects.

|(d) | Property and equipment
|--- | ----------------------

Recognition and measurementItems of property and equipment are measured at cost less accumulated
depreciation and accumulated impairment losses. Cost includes the expenditure
that is directly attributable to the acquisition of the asset. When parts of an
item of property and equipment have different useful lives, they are accounted
for as separate items (major components) of property and equipment. Gains and
losses on disposal of an item of property and equipment are determined by
comparing the proceeds from disposal with the carrying amount of property and
equipment, and are recognized in profit or loss.

Subsequent costsThe cost of
replacing a part of an item of property and equipment is recognized in the
carrying amount of the item if it is probable that the future economic benefits
embodied within the part will flow to the Company, and its cost can be measured
reliably. The carrying amount of the replaced part is then derecognized. The
costs of the day-to-day servicing of property and equipment are recognized in
profit or loss as incurred.

- 7 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

Depreciation The estimated
useful lives and the methods of depreciation for the current and comparative
periods are as follows:

Asset
    BasisLab equipment
    20% declining balanceComputer equipment
    30% declining balanceOffice equipment
    20% declining balanceLeaseholds
    Straight-line over expected lease term


Estimates for depreciation methods,
useful lives and residual values are reviewed at each reporting period-end and
adjusted if appropriate. Depreciation expense is recognized in research and
development expenses.

|(e) | Intangible assets
|--- | -----------------

Research and development

Expenditures on research activities,
undertaken with the prospect of gaining new scientific or technical knowledge
and understanding, are recognized in profit or loss as incurred.

Development activities involve a plan
or design for the production of new or substantially improved products and
processes. Development expenditures are capitalized only if development costs
can be measured reliably, the product or process is technically and commercially
feasible, future economic benefits are probable, and the Company intends to
complete development and has sufficient resources to complete development and to
use or sell the asset. Other development expenditures are expensed as incurred.
No internal development costs have been capitalized to date.

Research and development expenses
include all direct and indirect operating expenses supporting the products in
development. The costs incurred in establishing and maintaining patents are
expensed as incurred.

Intangible assets

Intangible assets that are acquired
separately and have finite useful lives are measured at cost less accumulated
amortization and accumulated impairment losses. Subsequent expenditures are
capitalized only when they increase the future economic benefits embodied in the
specific asset to which it relates. All other expenditure is recognized in
profit or loss as incurred.

Amortization is recognized in profit or
loss on a straight-line basis over the estimated useful lives of intangible
assets from the date they are available for use in the manner intended by
management. The period that the technologies acquired in the Trillium Privateco
acquisition are available for use is estimated at three years, which reflects
management's intent about developing and commercializing the assets.

The amortization method and
amortization period of an intangible asset with a finite life is reviewed at
least annually. Changes in the expected useful life or the expected pattern of
consumption of future economic benefits embodied in the asset are accounted for
by changing the amortization period or method, as appropriate, and are treated
as changes in accounting estimates. The amortization expense on intangible
assets with finite lives is recognized in research and development expenses.

- 8 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

|(f) | Impairment
|--- | ----------

Financial assets

A financial asset not carried at fair
value through profit or loss is assessed at each reporting date to determine
whether there is objective evidence that it is impaired. A financial asset is
impaired if objective evidence indicates that a loss event has occurred after
the initial recognition of the asset, and that the loss event had a negative
effect on the estimated future cash flows of that asset that can be estimated
reliably.

An impairment test is performed, on an
individual basis, for each material financial asset. Other individually
non-material financial assets are tested as groups of financial assets with
similar risk characteristics. Impairment losses are recognized in profit or
loss.

An impairment loss in respect of a
financial asset measured at amortized cost is calculated as the difference
between its carrying amount and the present value of the estimated future cash
flows discounted at the asset's original effective interest rate. Losses are
recognized in profit or loss and reflected in an allowance account against the
respective financial asset. Interest on the impaired asset continues to be
recognized through the unwinding of the discount. When a subsequent event causes
the amount of impairment loss to decrease, the decrease in impairment loss is
reversed through profit or loss.

Non-financial assets

The carrying amounts of the Company's
non-financial assets are reviewed at each reporting date to determine whether
there is any indication of impairment. If such an indication exists, the
recoverable amount is estimated.

The recoverable amount of an asset or a
cash-generating unit is the greater of its value in use and its fair value less
costs to sell. In assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to
the asset or cash-generating unit. For the purpose of impairment testing, assets
that cannot be tested individually are grouped together into the smallest group
of assets that generate cash inflows from continuing use that are largely
independent of cash inflows of other assets or cash-generating units. An
impairment loss is recognized if the carrying amount of an asset or its related
cash-generating unit exceeds its estimated recoverable amount. Impairment losses
for intangible assets are recognized in research and development expenses.

Impairment losses recognized in prior
periods are assessed at each reporting date for any indications that the loss
has decreased or no longer exists. An impairment loss is reversed if there has
been a change in the estimates used to determine the recoverable amount. An
impairment loss is reversed only to the extent that the asset's carrying amount
does not exceed the carrying amount that would have been determined, net of
depreciation or amortization, if no impairment loss had been recognized.

|(g) | Provisions
|--- | ----------

A provision is recognized if, as a
result of a past event, the Company has a present legal or constructive
obligation that can be estimated reliably, and it is probable that an outflow of
economic benefits will be required to settle the obligation. Provisions are
assessed by discounting the expected future cash flows at a pre-tax rate that
reflects current market assessments of the time value of money and the risks
specific to the liability. The unwinding of the discount on provisions is
recognized in finance costs.

A provision for onerous contracts is
recognized when the unavoidable costs of meeting the obligations under the
contract exceed the economic benefits expected to be received under it. The
provision is measured at the present value of the lower of the expected cost of
terminating the contract and the expected net cost of continuing with the
contract.

|(h) | Government assistance
|--- | ---------------------

Government assistance relating to
research and development is recorded as a reduction of expenses when the related
expenditures are incurred.

- 9 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

|(i) | Share-based compensation
|--- | ------------------------

The grant-date fair value of
share-based payment awards granted to employees is recognized as personnel
costs, with a corresponding increase in contributed surplus, over the period
that the employees unconditionally become entitled to the awards. The amount
recognized as an expense is adjusted to reflect the number of awards for which
the related service and non-market vesting conditions are expected to be met,
such that the amount ultimately recognized as an expense is based on the number
of awards that met the related service and non-market performance conditions at
the vesting date.

For equity-settled share-based payment
transactions, the Company measures the goods or services received, and the
corresponding increase in contributed surplus, directly, at the fair value of
the goods or services received, unless that fair value cannot be estimated
reliably. If the Company cannot estimate reliably the fair value of the goods or
services received, it measures their value by reference to the fair value of the
equity instruments granted. Transactions measured by reference to the fair value
of the equity instruments granted have their fair values remeasured at each
vesting and reporting date until fully vested.

|(j) | Income taxes
|--- | ------------

Deferred tax is recognized in respect
of temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognized for temporary differences on the initial
recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable income nor loss.

Deferred tax assets and liabilities are
offset if there is a legally enforceable right to offset current tax assets and
liabilities, and they relate to income taxes levied by the same tax authority on
the same taxable entity.

Deferred tax is measured at the tax
rates that are expected to be applied to temporary differences when they
reverse, based on the laws that have been enacted or substantively enacted at
the reporting date. A deferred tax asset is recognized for unused tax losses,
tax credits and deductible temporary differences, to the extent that it is
probable that future taxable profits will be available against which they can be
utilized.

Investment tax credits earned from
scientific research and development expenditures are recorded when
collectability is reasonably assured.

|(k) | Loss per share
|--- | --------------

Basic loss per share is computed by
dividing the net loss available to common shareholders by the weighted average
number of shares outstanding during the reporting period. Diluted loss per share
is computed similar to basic loss per share except that the weighted average
number of shares outstanding are increased to include additional shares for the
assumed exercise of stock options, deferred share units, warrants, and
conversion of preferred shares, if dilutive. The number of additional shares is
calculated by assuming that outstanding preferred shares would convert to common
shares and that outstanding stock options and warrants were exercised and that
the proceeds from such exercises were used to acquire common stock at the
average market price during the reporting period. The inclusion of the Company's
stock options, deferred share units, warrants and preferred shares in the
computation of diluted loss per share has an anti-dilutive effect on the loss
per share and therefore, they have been excluded from the calculation of diluted
loss per share.

|(l) | New standards and interpretations not yet
      effective
|--- | ---------------------------------------------------------

IFRS 9 Financial Instruments

In October 2010, the IASB published
amendments to IFRS 9 Financial Instruments(IFRS 9), which provides
added guidance on the classification and measurement of financial liabilities.
In July 2014, the IASB issued its final version of IFRS 9, which completes the
classification and measurement, impairment and hedge accounting phases of the
IASBs project to replace IAS 39. The final standard is mandatorily effective
for annual periods beginning on or after January 1, 2018, with earlier
application permitted. The Company is reviewing the standard to determine the
impact that the adoption of this standard may have on the consolidated financial
statements.

- 10 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

IFRS 15 Revenue from Contracts with
Customers

In May 2014, the IASB issued IFRS 15
Revenue from Contracts with Customers(IFRS 15), which covers
principles for reporting about the nature, amount, timing and uncertainty of
revenue and cash flows arising from contracts with customers. IFRS 15 is
effective for annual periods beginning on or after January 1, 2018. Entities
will transition following either a full or modified retrospective approach. The
Company is reviewing the standard to determine the impact that the adoption of
this standard may have on the consolidated financial statements.

IFRS 16 Leases

In January 2016, the IASB has issued
IFRS 16Leases (IFRS 16), its new leases standard that requires lessees
to recognize assets and liabilities for most leases on their balance sheets.
Lessees applying IFRS 16 will have a single accounting model for all leases,
with certain exemptions. Lessor accounting is substantially unchanged. The new
standard will be effective from January 1, 2019 with limited early application
permitted. The Company has not yet begun the process of evaluating the impact of
this standard on its consolidated financial statements.

Other accounting standards or
amendments to existing accounting standards that have been issued, but have
future effective dates, are either not applicable or are not expected to have a
significant impact on the Companys consolidated financial statements. The
Company assesses the impact of adoption of future standards on its consolidated
financial statements, but does not anticipate significant changes in 2016.

|4. | Amounts receivable
|-- | ------------------

December 31,
    
    
    December 31,2015
    
    
    2014**$**
    
    
    $Government receivable
    
    957,951
    
    
    344,416Other amounts receivable
    
    16,871
    
    
    -974,822
    
    
    344,416


- 11 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|5. | Property and equipment
|-- | ----------------------

Computer
    
    
    OfficeLab
    
    
    equipment
    
    
    equipment andequipment
    
    
    and software
    
    
    leaseholds
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $CostBalance, December 31, 2013
    
    111,025
    
    
    18,111
    
    
    9,381
    
    
    138,517Additions
    
    141,051
    
    
    21,917
    
    
    10,635
    
    
    173,603Balance, December 31, 2014
    
    252,076
    
    
    40,028
    
    
    20,016
    
    
    312,120Additions
    
    457,796
    
    
    57,180
    
    
    265,406
    
    
    780,382Balance, December 31, 2015
    
    709,872
    
    
    97,208
    
    
    285,422
    
    
    1,092,502Accumulated depreciationBalance, December 31, 2013
    
    14,723
    
    
    14,004
    
    
    783
    
    
    29,510Depreciation
    
    33,366
    
    
    9,554
    
    
    4,288
    
    
    47,208Balance, December 31, 2014
    
    48,089
    
    
    23,558
    
    
    5,071
    
    
    76,718Depreciation
    
    86,577
    
    
    26,679
    
    
    5,138
    
    
    118,394Balance December 31, 2015
    
    134,666
    
    
    50,237
    
    
    10,209
    
    
    195,112Net carrying amountsDecember 31, 2014
    
    203,987
    
    
    16,470
    
    
    14,945
    
    
    235,402December 31, 2015
    
    575,206
    
    
    46,971
    
    
    275,213
    
    
    897,390


|6. | Intangible assets
|-- | -----------------

Total$CostBalance, December 31, 2013
    
    2,103,751Disposals
    
    (1,085,714
    )Balance December 31, 2014 and 2015
    
    1,018,037Accumulated amortizationBalance, December 31, 2013
    
    630,279Amortization
    
    610,776Disposals
    
    (655,951
    )Balance, December 31, 2014
    
    585,104Amortization
    
    339,348Balance, December 31, 2015
    
    924,452Net carrying amountsDecember 31, 2014
    
    432,933December 31, 2015
    
    93,585


As at December 31, 2015, intangible
assets were comprised of licensed patent rights related to the SIRPαFc program
acquired in 2013 in the amount of $1,018,037.

The Company returned rights related to
tigecycline and recorded an impairment loss of $429,763 in the second quarter of
2014.

- 12 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|7. | Accounts payable and accrued
  liabilities
|-- | ------------------------------------------

December 31,
    
    
    December 31,2015
    
    
    2014**$**
    
    
    $Trade and other payables
    
    1,401,462
    
    
    1,604,533Accrued liabilities
    
    1,728,636
    
    
    1,585,823Due to related parties (note 15)
    
    103,651
    
    
    58,6283,233,749
    
    
    3,248,984


Amounts due to related parties
represent expense reimbursements, accrued vacation payable and directors fees
payable.

|8. | Non-current
liabilities
|-- | -----------------------

|(a) | Trillium is indebted to the Federal Economic Development
      Agency for Southern Ontario under a non-interest bearing contribution
      agreement and is making monthly repayments of $9,586 through November
      2019. As at December 31, 2015 and 2014, the balance repayable was $440,935
      and $555,968, respectively. The loan payable was discounted using an
      estimated market interest rate of 15%. Interest expense accretes on the
      discounted loan amount until it reaches its face value at
  maturity.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(b) | As at December 31, 2015 and 2014, the Company has a
      deferred lease inducement of $348,205 and nil, respectively, for a new
      facility lease. The inducement benefit will be recognized over the
      expected term of the lease.                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(c) | As at December 31, 2015 and 2014, the Company has a
      long-term liability of $60,109 and $69,941, respectively, related to
      certain discontinued technologies. This liability has been discounted
      using an estimated market interest rate of 15% and interest expense is
      accreting.                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | The current portions of the loan payable and long-term
      liability are included in other current liabilities in the statements of
      financial position.                                                                                                                                                                                                                                                                                                                                                                       

|9. | Share capital
|-- | -------------

|(a) | Authorized
|--- | ----------

The authorized share capital of the
Company consists of an unlimited number of common shares, Class B shares and
First Preferred Shares, in each case without nominal or par value. Common shares
are voting and may receive dividends as declared at the discretion of the Board
of Directors. Class B shares are non-voting and convertible to common shares at
the holders discretion, on a one-for-one basis. Upon dissolution or wind-up of
the Company, Class B shares participate rateably with the common shares in the
distribution of the Companys assets. Preferred shares have voting rights as
decided upon by the Board of Directors at the time of grant. Upon dissolution or
wind-up of the Company, First Preferred Shares are entitled to priority over
common and Class B shares.

The Company has Series I First
Preferred Shares that are non-voting, may receive dividends as declared at the
discretion of the Board of Directors, and are convertible to common shares at
the holders discretion, on the basis of 30 Series I First Preferred Shares for
one common share.

The Company has Series II First
Preferred Shares that are non-voting, may receive dividends as declared at the
discretion of the Board of Directors, and are convertible to common shares at
the holders discretion, on the basis of one Series II First Preferred Share for
one common share.

Holders may not convert Series I or
Series II Non-Voting Convertible First Preferred Shares into common shares if,
after giving effect to the exercise of conversion, the holder and its joint
actors would have beneficial ownership or direction or control over common
shares in excess of 4.99% of the then outstanding common shares. This limit may
be raised at the option of the holder on 61 days prior written notice: (i) up
to 9.99%, (ii) up to 19.99%, subject to clearance of a personal information form
submitted by the holder to the Toronto Stock Exchange, and (iii) above 19.99%,
subject to approval by the Toronto Stock Exchange and shareholder approval.

- 13 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|9. | Share capital
(continued)
|-- | -------------------------

|(b) | Share capital issued  year ended December 31,
      2015
|--- | ---------------------------------------------------------

On April 7, 2015, the Company completed
an underwritten public offering of common shares and non-voting convertible
preferred shares in the United States. In the offering, Trillium sold 1,750,754
common shares and 1,077,605 Series II Non-Voting Convertible First Preferred
Shares at a price of U.S. $19.50 per share, including 228,359 common shares sold
pursuant to the full exercise of the underwriters option to purchase additional
common shares. The gross proceeds to Trillium from this offering were
$68,875,067 (U.S. $55,153,000) before deducting offering expenses of $4,913,443.

During the year ended December 31,
2015, 1,087,603 common shares were issued on the exercise of 32,628,425 warrants
for proceeds of $9,515,154 and 6,666 stock options were exercised for proceeds
of $49,995.

During the year ended December 31,
2015, 15,716,110 Series I First Preferred Shares were converted into 523,870
common shares.

Share capital issued  year ended
December 31, 2014

On November 14, 2014, the Company
consolidated its outstanding common shares issuing one post-consolidated share
for each 30 pre-consolidated shares. All references in these consolidated
financial statements and notes to the number of common shares, deferred share
units and stock options have been adjusted to the post-consolidation amounts.

During the year ended December 31,
2014, 2,596,251 warrants were exercised for 86,540 common shares and for
proceeds of $946,813 and 2,614 stock options were exercised for proceeds of
$19,600. Also, 909,091 warrants issued in March 2011 expired unexercised.

During the year ended December 31,
2014, 8,390,476 Series I First Preferred Shares were converted into 279,682
common shares.

|(c) | Weighted average number of common
  shares
|--- | ------------------------------------------

The weighted average number of common
shares outstanding for the purposes of calculating earnings per share have been
adjusted for 2015 and 2014 to the post-consolidated number. The
post-consolidated weighted average number of common shares outstanding for the
years ended December 31, 2015 and 2014 were 6,641,161 and 4,202,900,
respectively. The Company has not adjusted its weighted average number of common
shares outstanding in the calculation of diluted loss per share, as any
adjustment would be antidilutive.

- 14 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|9. | Share capital
(continued)
|-- | -------------------------

|(d) | Warrants
|--- | --------

All warrants were exercisable on
issuance. As a result of the November 14, 2014 common share consolidation, the
ratio of the number of warrants exercisable for one common share was adjusted
from one warrant for each common share to 30 warrants for each common share.
The number of warrants outstanding was not adjusted.

The following table shows the number of
warrants outstanding, the exercise prices, and the number of common shares
issuable on exercise of the warrants and the exercise price per common share for
30 warrants as at December 31, 2015:

Number of
    
    
    Exercisecommon shares
    
    
    price perNumber of
    
    
    Exercise
    
    
    issuable
    
    
    common shareExpiry dates
    
    warrants
    
    
    price
    
    
    on exercise
    
    
    (30 warrants
    )March 15, 2018
    
    9,213,780
    
    $
    0.40
    
    
    307,126
    
    $
    12.00March 27, 2018
    
    300,000
    
    $
    0.40
    
    
    10,000
    
    $
    12.00December 13, 2018
    
    96,582,576
    
    $
    0.28
    
    
    3,219,419
    
    $
    8.40106,096,356
    
    
    
    
    
    3,536,545


Changes in the number of warrants
outstanding during the years ended December 31 were as follows:

2015
    
    
    
    
    
    2014Weighted
    
    
    
    
    
    Weightedaverage
    
    
    
    
    
    averageNumber of
    
    
    exercise
    
    
    Number of
    
    
    exercisewarrants
    
    
    price
    
    
    warrants
    
    
    priceBalance, beginning of year
    
    138,724,781
    
    $
    0.29
    
    
    142,230,123
    
    $
    0.30Exercised
    
    (32,628,425
    )
    
    0.29
    
    
    (2,596,251
    )
    
    0.36Expired
    
    -
    
    
    -
    
    
    (909,091
    )
    
    1.60Balance, end of year
    
    106,096,356
    
    $
    0.29
    
    
    138,724,781
    
    $
    0.29


|(e) | Stock option plan
|--- | -----------------

The Company has a 10% rolling stock
option plan (the 2014 Stock Option Plan) that was approved by the Companys
shareholders at its annual general meeting held on May 27, 2014. Pursuant to the
2014 Stock Option Plan, the Company may grant stock options to purchase up to an
aggregate of 10% of the Companys issued and outstanding common shares plus 10%
of the total number of common shares into which the outstanding Series I First
Preferred Shares may be converted. Options granted under the 2014 Stock Option
plan are equity-settled, have a vesting period of four years and have a maximum
term of ten years. As at December 31, 2015, the Company was entitled to issue an
additional 87,048 stock options under the 2014 Stock Option Plan.

- 15 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|9. | Share capital (continued)
|-- | -------------------------

Changes in the number of options
outstanding during the years ended December 31 were as follows:

2015
    
    
    
    
    
    2014Weighted
    
    
    
    
    
    Weightedaverage
    
    
    
    
    
    averageNumber of
    
    
    exercise
    
    
    Number of
    
    
    exerciseoptions
    
    
    price
    
    
    options
    
    
    priceBalance, beginning of year
    
    590,141
    
    $
    9.76
    
    
    97,372
    
    $
    9.94Granted
    
    347,359
    
    
    21.40
    
    
    499,883
    
    
    9.78Exercised
    
    (6,666
    )
    
    7.50
    
    
    (2,614
    )
    
    7.50Cancelled/forfeited
    
    (3,000
    )
    
    30.00
    
    
    (4,500
    )
    
    16.58Balance, end of year
    
    927,834
    
    $
    14.07
    
    
    590,141
    
    $
    9.76Options exercisable, end of year
    
    333,927
    
    $
    10.94
    
    
    219,470
    
    $
    10.13


The following table reflects stock
options outstanding at December 31, 2015:

Stock options
      outstanding
    
    
    Stock options
      exercisableWeighted averageremainingNumber
    
    
    contractual life
    
    
    Weighted average
    
    
    Exercisable
    
    
    Weighted averageExercise prices
    
    outstanding
    
    
    (in years)
    
    
    exercise price
    
    
    number
    
    
    exercise price$7.50
    
    74,841
    
    
    7.3
    
    $
    7.50
    
    
    49,903
    
    $
    7.50$8.34
    
    215,758
    
    
    8.4
    
    $
    8.34
    
    
    107,878
    
    $
    8.34$10.35
    
    264,127
    
    
    8.3
    
    $
    10.35
    
    
    132,064
    
    $
    10.35$15.30
    
    6,666
    
    
    8.1
    
    $
    15.30
    
    
    3,333
    
    $
    15.30$18.90
    
    13,332
    
    
    8.2
    
    $
    18.90
    
    
    6,666
    
    $
    18.90$19.33
    
    220,859
    
    
    9.9
    
    $
    19.33
    
    
    -
    
    $
    19.33$23.44
    
    85,000
    
    
    9.3
    
    $
    23.44
    
    
    28,332
    
    $
    23.44$28.05
    
    29,000
    
    
    9.4
    
    $
    28.05
    
    
    -
    
    $
    28.05$28.52
    
    12,500
    
    
    9.4
    
    $
    28.52
    
    
    -
    
    $
    28.52$30.00
    
    5,751
    
    
    0.6
    
    $
    30.00
    
    
    5,751
    
    $
    30.00927,834
    
    
    8.7
    
    $
    14.07
    
    
    333,927
    
    $
    10.94


- 16 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|9. | Share capital (continued)
|-- | -------------------------

Share-based compensation expense was
determined based on the fair value of the options at the date of measurement
using the Black-Scholes option pricing model with the weighted average
assumptions for the years ended December 31 as follows:

2015
    
    
    2014Expected option life
    
    6
      years
    
    
    6 yearsRisk-free interest rate
    
    1.2%
    
    
    1.7%Dividend yield
    
    0%
    
    
    0%Expected volatility
    
    83%
    
    
    90%


The Black-Scholes option pricing model
was developed to estimate the fair value of freely tradable, fully transferable
options without vesting restrictions, which significantly differs from the
Company's stock option awards. This model also requires highly subjective
assumptions, including future stock price volatility and average option life,
which significantly affect the calculated values.

The risk-free interest rate is based on
the implied yield on a Government of Canada zero-coupon issue with a remaining
term equal to the expected term of the option. Expected volatility was
determined using a combination of historical volatilities of a peer group of
biotechnology companies and the Companys own historical volatility. The life of
the options is estimated considering the vesting period at the grant date, the
life of the option and the average length of time similar grants have remained
outstanding in the past. The forfeiture rate is an estimate based on historical
evidence and future expectations. The dividend yield was excluded from the
calculation since it is the present policy of the Company to retain all earnings
to finance operations and future growth.

For the years ended December 31, 2015
and 2014, the Company issued 347,359 and 499,883 stock options with a fair value
of $5,227,499 and $3,580,892 and a weighted average grant date fair value of
$15.05 and $7.16, respectively.

|(f) | Deferred Share Unit Plan
|--- | ------------------------

The 2014 Deferred Share Unit Plan (the
2014 DSU Plan) promotes greater alignment of long-term interests between
non-executive directors and executive officers of the Company and its
shareholders through the issuance of deferred share units (DSUs). Since the
value of a DSU increases or decreases with the market price of the common
shares, DSUs reflect a philosophy of aligning the interests of directors and
executive officers with those of the shareholders by tying compensation to share
price performance. For the years ended December 31, 2015 and 2014, a total of
23,011 and 28,777 DSUs were issued for payment of directors fees, respectively.
The Company has reserved for issuance up to 66,667 common shares under the 2014
DSU Plan and 51,788 DSUs were outstanding as at December 31, 2015.

|(g) | Shareholder Rights Plan
|--- | -----------------------

On October 17, 2013 the Companys
shareholders adopted a shareholder rights plan (the 2013 Rights Plan) and
approved certain amendments on May 27, 2014 (the Rights Plan Amendment which
together with the 2013 Rights Plan may be referred to as the Rights Plan). The
Rights Plan is designed to provide adequate time for the Board of Directors and
the shareholders to assess an unsolicited takeover bid for the Company, to
provide the Board of Directors with sufficient time to explore and develop
alternatives for maximizing shareholder value if a takeover bid is made, and to
provide shareholders with an equal opportunity to participate in a takeover bid
and receive full and fair value for their common shares. The Rights Plan will
expire at the close of the Companys annual meeting of shareholders in 2016.

- 17 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|9. | Share capital (continued)
|-- | -------------------------

The rights issued under the Rights Plan
initially attach to and trade with the common shares and no separate
certificates will be issued unless an event triggering these rights occurs. The
rights will become exercisable only when a person, including any party related
to it, acquires or attempts to acquire 20% or more of the outstanding common
shares without complying with the Permitted Bid provisions of the Rights Plan
or without approval of the Board of Directors. Should such an acquisition occur
or be announced, each right would, upon exercise, entitle a rights holder, other
than the acquiring person and related persons, to purchase common shares at an
approximate 50% discount to the market price at the time.

Under the Rights Plan, a Permitted Bid
is a bid made to all holders of the common shares and which is open for
acceptance for not less than 60 days. If at the end of 60 days at least 50% of
the outstanding common shares, other than those owned by the offeror and certain
related parties have been tendered, the offeror may take up and pay for the
common shares but must extend the bid for a further 10 days to allow other
shareholders to tender. The issuance of common shares upon the exercise of the
rights is subject to receipt of certain regulatory approvals.

|10. | Income taxes
|--- | ------------

Income taxes have not been recognized
in the consolidated statements of loss and comprehensive loss, as the Company
has been incurring losses since inception, and it is not probable that future
taxable profits will be available against which the accumulated tax losses can
be utilized.

|(a) | Unrecognized deferred tax
assets
|--- | --------------------------------

As at December 31, 2015 and 2014,
deferred tax assets have not been recognized with respect to the following
items:

2015
    
    
    2014**$**
    
    
    $Non-capital losses carried
      forward
    
    11,750,952
    
    
    9,234,460Tax credits carryforward
    
    3,090,833
    
    
    2,607,496Tax basis of property and
      equipment and intangible assets in excess of accounting basis
    
    1,577,156
    
    
    1,413,171Scientific research and experimental
      development expenditures
    
    5,524,225
    
    
    4,801,014Share issue costs and other
    
    493,476
    
    
    436,79522,436,642
    
    
    18,492,936


|(b) | As at December 31, 2015 and 2014, the Company has
      available research and development expenditures of approximately
      $20,846,000 and $18,117,000, respectively, for income tax purposes which
      may be carried forward indefinitely to reduce future years taxable
      income. As at December 31, 2015 and 2014, the Company also has unclaimed
      Canadian scientific research and development tax credits of $3,920,000 and
      $3,293,000, respectively, which are available to reduce future taxes
      payable with expiries from 2017 through 2034. The benefit of these
      expenditures and tax credits has not been recorded in the
  accounts.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(c) | As at December 31, 2015, the Company has accumulated
      non-capital losses for federal and provincial income tax purposes in
      Canada which are available for application against future taxable income.
      The benefit of these losses has not been recorded in the
  accounts.                                                                                                                                                                                                                                                                                                                                                                                       

- 18 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|10. | Income taxes (continued)
|--- | ------------------------

The non-capital tax losses expire as
follows:

Federal$2025
    
    3,213,0002026
    
    6,457,0002027
    
    4,659,0002028
    
    4,144,0002029
    
    3,736,0002030
    
    1,819,0002031
    
    1,387,0002032
    
    2,715,0002033
    
    1,971,0002034
    
    5,001,0002035
    
    9,241,00044,343,000


|(d) | The reconciliation of the Canadian statutory income tax
      rate applied to the net loss for the year to the income tax recovery is as
      follows:
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------

2015
    
    
    2014**$**
    
    
    $Statutory income tax rate
    
    26.5%
    
    
    26.5%Income tax recovery based on
      statutory income tax rate
    
    (3,901,912
    )
    
    (3,413,682
    )Investment tax credits
    
    (473,156
    )
    
    (1,091,870
    )Share-based compensation and
      other
    
    485,009
    
    
    657,494Change in unrecognized tax assets
    
    3,899,561
    
    
    3,848,058Income tax expense
    
    9,502
    
    
    -


|11. | Research and development
|--- | ------------------------

Components of research and development
expenses for the years ended December 31 were as follows:

2015
    
    
    2014**$**
    
    
    $Research and development
      programs, excluding the below items
    
    12,083,797
    
    
    5,893,030Salaries, fees and short-term benefits
    
    4,120,109
    
    
    2,311,755Share-based compensation
    
    1,942,173
    
    
    1,626,824Amortization of intangible assets
    
    339,348
    
    
    610,776Impairment of intangible
      assets
    
    -
    
    
    429,763Depreciation of property and equipment
    
    118,394
    
    
    47,208Tax credits
    
    (553,730
    )
    
    (323,548
    )18,050,091
    
    
    10,595,808


- 19 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|12. | General and administrative
|--- | --------------------------

Components of general and
administrative expenses for the years ended December 31 were as follows:

2015
    
    
    2014**$**
    
    
    $General and administrative
      expenses, excluding the below items
    
    1,521,639
    
    
    1,198,181Salaries, fees and short-term benefits
    
    898,381
    
    
    694,849DSU units issued for director
      compensation
    
    540,000
    
    
    240,000Share-based compensation
    
    224,327
    
    
    444,4303,184,347
    
    
    2,577,460


|13. | Finance income and finance
costs
|--- | --------------------------------

Finance income for the years ended
December 31 was as follows:

2015
    
    
    2014**$**
    
    
    $Interest income
    
    488,486
    
    
    378,692Net
      foreign currency gain
    
    6,106,703
    
    
    -6,595,189
    
    
    378,692


Finance costs for the years ended
December 31 were as follows:

2015
    
    
    2014**$**
    
    
    $Bank charges
    
    11,557
    
    
    7,212Accreted interest
    
    73,391
    
    
    69,770Net foreign currency loss
    
    -
    
    
    10,26284,948
    
    
    87,244


|14. | Commitments and
contingencies
|--- | -----------------------------

As at December 31, 2015, the Company
had capital commitments for the acquisition of property and equipment of
approximately $1,026,000.

As at December 31, 2015, the Company
had obligations to make future payments, representing significant research and
development contracts and other commitments that are known and committed in the
amount of approximately $7,789,000. These contracts include the clinical
research organization agreement for conducting the Phase I trial, and other
preclinical and manufacturing activities.  The Company also has minimum lease payments
relating to operating lease commitments in the amount of $266,000 over the next
12 months, $955,000 from 12 to 60 months, and $1,289,000 thereafter.

The Company enters into research,
development and license agreements in the ordinary course of business where the
Company receives research services and rights to proprietary technologies.
Milestone and royalty payments that may become due under various agreements are
dependent on, among other factors, clinical trials, regulatory approvals and
ultimately the successful development of a new drug, the outcome and timing of
which is uncertain. Under the license agreement for SIRPαFc, the Company has
future contingent milestones payable of $35,000 related to successful patent
grants, $100,000, $200,000 and $300,000 on the first patient dosed in phase I,
II and III trials respectively, and regulatory milestones on their first
achievement totalling $5,000,000. The Company is required to pay 20% of any
sublicensing revenues to the licensors on the first $50 million of sublicensing
revenues, and pay 15% of any sublicensing revenues to the licensors after the
first $50 million of sublicensing revenue received.

- 20 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|14. | Commitments and contingencies
  (continued)
|--- | -------------------------------------------

The Company entered into two agreements
with Catalent Pharma Solutions in August 2014 pursuant to which Trillium
acquired the right to use a proprietary expression system for the manufacture of
two SIRPαFc constructs. Consideration for each license includes potential
pre-marketing approval milestones of up to U.S. $875,000 and aggregate sales
milestone payments of up to U.S. $28.8 million.

The Company periodically enters into
research and license agreements with third parties that include indemnification
provisions customary in the industry. These guarantees generally require the
Company to compensate the other party for certain damages and costs incurred as
a result of claims arising from research and development activities undertaken
by or on behalf of the Company. In some cases, the maximum potential amount of
future payments that could be required under these indemnification provisions
could be unlimited. These indemnification provisions generally survive
termination of the underlying agreement. The nature of the indemnification
obligations prevents the Company from making a reasonable estimate of the
maximum potential amount it could be required to pay. Historically, the Company
has not made any indemnification payments under such agreements and no amount
has been accrued in the audited consolidated financial statements with respect
to these indemnification obligations.

|15. | Related parties
|--- | ---------------

For the years ended December 31, 2015
and 2014, the key management personnel of the Company were the Board of
Directors, Chief Executive Officer, Chief Medical Officer, Chief Scientific
Officer, Chief Financial Officer and the Chief Development Officer.

Compensation for key management
personnel of the Company for the years ended December 31 was as follows:

2015
    
    
    2014**$**
    
    
    $Salaries, fees and short-term
      benefits
    
    2,595,536
    
    
    1,708,717Share-based compensation
    
    2,433,710
    
    
    2,281,561Total
    
    5,029,246
    
    
    3,990,278


Executive officers and directors
participate in the 2014 Stock Option Plan and the 2014 DSU Plan, and officers
participate in the Companys benefit plans. Directors receive annual fees for
their services. As at December 31, 2015, the key management personnel controlled
approximately 1% of the voting shares of the Company.

Under IFRS, the acquisition of
Fluorinov Pharma Inc. (Fluorinov) was considered a related party transaction
as two Company directors were determined to be related parties of Fluorinov (see
Note 19). One Company director was a director of Fluorinov and had an ownership
position in Fluorinov at the time of acquisition of less than 2%, and the second
director was a director of an entity that was a beneficiary of a trust that was
a shareholder and debenture holder of Fluorinov. The two directors declared
their conflict of interest and abstained from all discussions and decisions
concerning the Fluorinov acquisition. Accordingly, the Company determined that
the consideration paid on the acquisition was made on terms equivalent to those
that prevail in arms length transactions.

Outstanding balances with related
parties at the year-end are unsecured, interest free and settlement occurs in
cash. There have been no guarantees provided or received for any related party
receivables or payables. For the years ended December 31, 2015 and 2014, a
former director was paid consulting fees of $0 and $7,916, respectively.

|16. | Operating segment
|--- | -----------------

The Company has a single operating
segment, the research and development therapies for the treatment of cancer.
Substantially all of the Companys operations, assets, and employees are in
Canada.

- 21 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|17. | Management of capital
|--- | ---------------------

The Company defines its capital as
share capital, warrants and contributed surplus. The Companys objectives when
managing capital are to ensure there are sufficient funds available to carry out
its research and development programs. To date, these programs have been funded
primarily through the sale of equity securities and the exercise of common share
purchase warrants. The Company also sources non-dilutive funding by accessing
grants, government assistance and tax incentives, and through partnerships with
corporations and research institutions. The Company uses budgets and purchasing
controls to manage its costs. The Company is not exposed to any externally
imposed capital requirements.

|18. | Financial instruments
|--- | ---------------------

Fair value

IFRS 13 Fair Value Measurement
provides a hierarchy of valuation techniques based on whether the inputs to
those valuation techniques are observable or unobservable. Observable inputs are
those which reflect market data obtained from independent sources, while
unobservable inputs reflect the Companys assumptions with respect to how market
participants would price an asset or liability. These two inputs used to measure
fair value fall into the following three different levels of the fair value
hierarchy:

| | Level 1 | Quoted prices in active markets for identical instruments
      that are observable.                                                                                                
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Level 2 | Quoted prices in active markets for similar instruments;
      inputs other than quoted prices that are observable and derived from or
      corroborated by observable market data.
| | Level 3 | Valuations derived from valuation techniques in which one
      or more significant inputs are unobservable.                                                                        

The hierarchy requires the use of
observable market data when available.

The Company has classified cash as
Level 1. The loan payable has been classified as Level 2.

Cash, amounts receivable, accounts
payable and accrued liabilities, and other current liabilities, due within one
year, are all short-term in nature and, as such, their carrying values
approximate fair values. The fair value of the non-current loan payable is
estimated by discounting the expected future cash flows at the cost of money to
the Company, which is equal to its carrying value.

Risks

The Company has exposure to credit
risk, liquidity risk, interest rate risk and currency risk. The Companys Board
of Directors has overall responsibility for the establishment and oversight of
the Companys risk management framework. The Audit Committee of the Board is
responsible for reviewing the Companys risk management policies.

|(a) | Credit risk
|--- | -----------

Credit risk is the risk of financial
loss to the Company if a counterparty to a financial instrument fails to meet
its contractual obligations, and arises principally from the Companys cash and
amounts receivable. The carrying amount of these financial assets represents the
maximum credit exposure. The Company follows an investment policy to mitigate
against the deterioration of principal and to enhance the Companys ability to
meet its liquidity needs. Cash is on deposit with major Canadian chartered banks
and the Company invests in high grade short-term instruments. Amounts receivable
are primarily comprised of amounts due from the federal government.

|(b) | Liquidity risk
|--- | --------------

Liquidity risk is the risk that the
Company will not be able to meet its financial obligations as they fall due. The
Company is a development stage company and is reliant on external fundraising to
support its operations. Once funds have been raised, the Company manages its
liquidity risk by investing in cash and short-term instruments to provide
regular cash flow for current operations. It also manages liquidity risk by
continuously monitoring actual and projected cash flows. The Board of Directors
reviews and approves the Companys operating and capital budgets, as well as any
material transactions not in the ordinary course of business. The majority of
the Companys accounts payable and accrued liabilities have maturities of less
than three months.

- 22 -

---

|TRILLIUM THERAPEUTICS INC.                    
|----------------------------------------------
|                                              
|Notes to the Consolidated Financial Statements
|For the years ended December 31, 2015 and 2014
|Amounts in
      Canadian Dollars             

|18. | Financial instruments
(continued)
|--- | ---------------------------------

|(c) | Interest rate risk
|--- | ------------------

Interest rate risk is the risk that the
fair value or future cash flows of a financial instrument will fluctuate because
of changes in market interest rates. The Company holds its cash in bank accounts
or high interest savings accounts which have a variable rate of interest. The
Company manages its interest rate risk by holding highly liquid short-term
instruments and by holding its investments to maturity, where possible. For the
years ended December 31, 2015 and 2014, the Company earned interest income of
$488,486 and $378,692, respectively. Therefore, a 1% change in the average
interest rate for the years ended December 31, 2015 and 2014, would have a net
impact on finance income of $4,885 and $3,787, respectively.

|(d) | Currency risk
|--- | -------------

The Company is exposed to currency risk
related to the fluctuation of foreign exchange rates and the degree of
volatility of those rates. Currency risk is limited to the portion of the
Companys business transactions denominated in currencies other than the
Canadian dollar which are primarily expenses in US dollars. As at December 31,
2015 and 2014, the Company held US dollar cash in the amount of US$44,547,591
and US$142,558 and had US dollar denominated accounts payable and accrued
liabilities in the amount of US$1,033,319 and US$1,910,430, respectively.
Therefore, a 1% change in the foreign exchange rate would have a net impact on
finance costs as at December 31, 2015 and 2014 of $435,143 and $17,679,
respectively.

US dollar expenses for the years ended
December 31, 2015 and 2014 were approximately US$8,700,000 and US$3,260,000,
respectively. Varying the US exchange rate for the years ended December 31, 2015
and 2014 to reflect a 5% strengthening of the Canadian dollar would have
decreased the net loss by approximately $435,000 and $163,000, respectively,
assuming that all other variables remained constant.

|19. | Events after the balance sheet
  date
|--- | -------------------------------------

On January 26, 2016, the Company
acquired all of the outstanding shares of Fluorinov, a private oncology company,
for an upfront payment of $10 million plus up to $35 million of additional
future payments that are contingent on Trillium achieving certain clinical and
regulatory milestones with an existing Fluorinov compound. Trillium will also
have an obligation to pay royalty payments on future sales of such compounds.
The upfront payment was subject to adjustment based on the net working capital
of Fluorinov and other adjustments at the time of closing. At Trilliums
discretion, up to 50% of the future contingent payments can be satisfied through
the issuance of common shares of Trillium provided that the aggregate number of
common shares issuable under such payments will not exceed 1,558,447 common
shares unless shareholder approval has first been obtained. In addition, any
such future share issuance remains subject to final approval from Trilliums
board of directors and receipt of any requisite approvals under the applicable
rules of the Toronto Stock Exchange and the NASDAQ Stock Market. Trillium has
also committed to use commercially reasonable efforts to monetize Fluorinovs
CNS assets and share 50% of the net proceeds with Fluorinov shareholders. The
acquisition of Fluorinov will be accounted for as a business combination under
the acquisition method of accounting. The Company will record the assets
acquired and liabilities assumed at their fair values as of the acquisition
date. Due to the limited amount of time since the acquisition date, the
preliminary acquisition valuation for the business combination is incomplete at
this time. As a result, the Company is unable to provide the amounts recognized
as of the acquisition date for the major classes of assets acquired and
liabilities assumed.

- 23 -

---