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Item 9A. Controls and Procedures

2021-03-31 compared with 2020-03-26 · 1256 added, 996 removed, 269 unchanged (89% of the section changed)

CONTROLS AND PROCEDURES

of Disclosure Controls and Procedures

the supervision and with the participation of our management, including our principal executive officer and principal financial

and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of December

31, 2019, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act.

Based on this evaluation, our principal

executive officer and principal financial and accounting officer have concluded that during the period covered by this Annual

Report, our disclosure controls and procedures were effective.

controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is

recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such

information is accumulated and communicated to our management, including our principal executive officer and principal financial

officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive

Officer, or CEO, and our Senior Vice President of Finance and Operations (our principal executive officer and principal financial

officer, respectively), performed an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules

13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2020.

Based on the aforementioned evaluation, our management

has concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of December 31, 2020.

Management’s

Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing

and maintaining adequate internal control over financial reporting.

Our internal control over financial reporting has been designed

to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for

external purposes in accordance with generally accepted accounting principles in the United States of America.

Our internal control over financial reporting

includes policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect

transactions and dispositions of our assets;

provide reasonable assurance that transactions are recorded as necessary to permit

preparation of financial statements in accordance with generally accepted accounting principles in the United States of America,

and that receipts and expenditures are being made only in accordance with authorization of our management and directors;

reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that

could have a material effect on our financial statements.

Because of its inherent limitations, internal

control over financial reporting may not prevent or detect misstatements.

Therefore, even those systems determined to be effective

can provide only reasonable assurance with respect to financial statement preparation and presentation.

Projections of any evaluation

of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions,

or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of

our internal control over financial reporting on December 31, 2020.

In making this assessment, management used the criteria set

forth by the Committee of Sponsoring Organizations of the Treadway Commission 2013 framework, in Internal Control—Integrated

Based on that assessment under those criteria, management has determined that, as of December 31, 2020, our internal

control over financial reporting was effective.

This Annual Report does not include an attestation

report of our independent registered public accounting firm regarding internal control over financial reporting due to an exemption

for emerging growth companies provided in the JOBS Act.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal

control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during

the fourth quarter of fiscal year 2020 that have materially affected, or are reasonably likely to materially affect, our internal

control over financial reporting.

This Annual Report does not include a report of management's

assessment, or an attestation by our registered public accounting firm regarding management’s assessment, of internal control

over financial reporting.

Management did not have sufficient time following the Business Combination to complete a comprehensive

assessment of internal control over financial reporting.

In making this determination, we considered the effects of the Business

Combination, which is treated as a “reverse merger”

in accordance with GAAP and after which, substantially all of

the business of the Company was that of BiomX.

Management has begun to take steps to strengthen the Company’s internal control

over financial reporting, including the hiring of experienced accounting and finance staff, and adopting new policies and procedures,

and intends to take additional steps during the 2020 fiscal year.

Management intends to complete its assessment for inclusion in

our 2020 Annual Report.

in Internal Control over Financial Reporting

have been no changes in our internal control over financial reporting during the fiscal quarter ended December 31, 2019 that have

materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

OTHER INFORMATION

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

required by this Item regarding the Company’s directors and corporate governance, including information with respect to

our corporate governance guidelines, Code of Business Conduct and Ethics and beneficial ownership reporting compliance, will appear

in the Proxy Statement we will deliver to our stockholders in connection with our 2020 Annual Meeting of Stockholders.

Such information

is incorporated herein by reference.

Information relating to our executive officers is included in Item 1 of Part I, “Business—Executive

Officers.”

We intend to file a definitive proxy statement for our 2021

Annual General Meeting of Stockholders, or the 2021 Proxy Statement, with the SEC, pursuant to Regulation 14A, not later than 120

days after December 31, 2020.

Accordingly, certain information required by Part III has been omitted under General Instruction

G(3) to Form 10-K.

Only those sections of the 2021 Proxy Statement that specifically address the items set forth herein are incorporated

by reference.

DIRECTORS, EXECUTIVE OFFICERS

AND CORPORATE GOVERNANCE

Code of Business Conduct and Ethics

We have adopted

a Code of Business Conduct and Ethics that applies to all directors, officers and employees.

The Code of Business Conduct and

Ethics is available on our website at www.biomx.com.

If we make any substantive amendments to the Code of Business Conduct and

Ethics or grants any waiver from a provision of the Code to any director or executive officer, we will promptly disclose the nature

of the amendment or waiver on our website.

Other Information

The remaining information required by this item will be included

in our 2021 Proxy Statement, and such required information is incorporated herein by reference into this Annual Report.

EXECUTIVE COMPENSATION

information required by this Item will appear in the Proxy Statement we will deliver to our stockholders in connection with our

2020 Annual Meeting of Stockholders.

Such information is incorporated herein by reference.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

information required by this Item regarding security ownership of certain beneficial owners and management will appear in the

Proxy Statement we will deliver to our stockholders in connection with our 2020 Annual Meeting of Stockholders.

Such information

is incorporated herein by reference.

Information relating to securities authorized for issuance under the Company’s equity

compensation plans is included in Part II of this Annual Report under “Item 5–Market for Registrant’s Common

Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.”

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

information required by this Item will appear in the Proxy Statement we will deliver to our stockholders in connection with our

2020 Annual Meeting of Stockholders.

Such information is incorporated herein by reference.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

information required by this Item will appear in the Proxy Statement we will deliver to our stockholders in connection with our

2020 Annual Meeting of Stockholders.

Such information is incorporated herein by reference.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

following are filed with this report:

financial statements listed on the Financial Statements’

following exhibits are filed as part of this Annual Report or are incorporated by reference.

Merger Agreement (Incorporated by reference to Exhibit 2.1 to the registrant’s Current Report on Form 8-K filed by the registrant on July 17, 2019)

Amendment Agreement to the Merger Agreement (Incorporated by reference to Exhibit 2.1 to the registrant’s Current Report on Form 8-K filed by the registrant on October 11, 2019)

Amended and Restated Certificate of Incorporation of the Company, effective on December 11, 2018 (Incorporated by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Certificate of Amendment of Certificate of Incorporation of the Company, effective on October 28, 2019 (Incorporated by reference to Exhibit 3.2 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Amended and Restated Bylaws of the Company, effective as of October 28, 2019 (Incorporated by reference to Exhibit 3.3 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Specimen Unit Certificate (Incorporated by reference to Exhibit 4.1 to the registrant’s Registration Statement on Form S-1 filed by the registrant on December 4, 2018)

Specimen Common Stock Certificate (Incorporated by reference to Exhibit 4.2 to the registrant’s Registration Statement on Form S-1 filed by the registrant on December 4, 2018)

Specimen Warrant Certificate (Incorporated by reference to Exhibit 4.3 to the registrant’s Registration Statement on Form S-1 filed by the registrant on December 4, 2018)

Warrant Agreement, dated December 13, 2018 between Continental Stock Transfer & Trust Company and the registrant (Incorporated by reference to Exhibit 4.1 to the registrant’s Current Report on Form 8-K filed by the registrant on December 18, 2018)

Registration Rights Agreement dated October 28, 2019 (Incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Escrow Agreement dated October 28, 2019, among Chardan Healthcare Acquisition Corp., Shareholder Representative Services LLC and Continental Stock Transfer & Trust Company (Incorporated by reference to Exhibit 10.2 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Voting Agreement dated October 28, 2019 (Incorporated by reference to Exhibit 10.3 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Form of Indemnification Agreement with each director and officer (Incorporated by reference to Exhibit 10.4 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

The information required by this item will be included in our

2021 Proxy Statement and is hereby incorporated by reference into this Annual Report.

SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Securities Authorized for Issuance Under Equity Compensation

We have two equity incentive plans, the 2015 Employee Stock

Option Plan, or the 2015 Plan, and the Chardan Healthcare Acquisition Corp.

2019 Equity Incentive Plan, or the 2019 Plan.

2019, in connection with the Business Combination, we assumed the 2015 Plan with respect to each outstanding equity award thereunder.

Although no shares of our Common Stock are available for future issuance under the 2015 Plan, the 2015 Plan will continue to govern

outstanding awards granted thereunder.

As of December 31, 2020, options to purchase 2,714,066 shares of our Common Stock remained

outstanding under the 2015 Plan.

The 2019 Plan was adopted by the Board

of Directors and approved by our stockholders in connection with the Business Combination.

As of December 31, 2020, there were

60,041 shares of our Common Stock available for issuance under the 2019 Plan.

The aggregate number of shares of our Common Stock

available for issuance pursuant to the 2019 Plan automatically increases on January 1 of each year, for a period of not more than

ten years, commencing on January 1, 2020 and ending on (and including) January 1, 2029, in an amount equal to 4% of the total

number of shares of Common Stock outstanding on December 31 of the preceding calendar year.

Accordingly, on January 1, 2021, 930,813

additional shares of our Common Stock were made available for issuance pursuant to the 2019 Plan.

For additional information regarding the

2015 Plan and the 2019 Plan, as of December 31, 2020, please see Part II –

Item 8 –

Financial Statements and Supplemental

Notes to consolidated financial statements –

Note 12B –

Stock-Based Compensation.

Equity Compensation Plan Information

December 31, 2020

Plan category

available for

Equity compensation plans approved by security holders

Equity compensation plans not approved by security holders

The other information required by this item will be included

under the “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters”

in our 2021 Proxy Statement and is hereby incorporated by reference into this Annual Report.

CERTAIN RELATIONSHIPS AND RELATED

TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this item will be included

in our 2021 Proxy Statement and is hereby incorporated by reference into this Annual Report.

PRINCIPAL ACCOUNTANT FEES AND

The information required by this item will

be included in our 2021 Proxy Statement and is hereby incorporated by reference into this Annual Report.

EXHIBITS AND FINANCIAL

STATEMENT SCHEDULES

The following are filed with this report:

The financial statements listed on the Financial

Statements’

Not applicable

The following exhibits are filed as part

of this Annual Report or are incorporated by reference.

EXHIBIT INDEX

Agreement (Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed by the Company on

July 17, 2019)

Agreement to the Merger Agreement (Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K

filed by the Company on October 11, 2019)

Composite Copy of Amended and Restated Certificate of Incorporation of the Company, effective on December 11, 2018, as amended to date.

(Incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q filed by the Company on August 13, 2020)

Amended and Restated Bylaws of the Company, effective as of October 28, 2019 (Incorporated by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

Description of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended

Specimen Unit Certificate (Incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-1 filed by the Company on December 4, 2018)

Specimen Common Stock Certificate (Incorporated by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-1 filed by the Company on December 4, 2018)

Specimen Warrant Certificate (Incorporated by reference to Exhibit 4.3 to the Company’s Registration Statement on Form S-1 filed by the Company on December 4, 2018)

Warrant Agreement, dated December 13, 2018 between Continental Stock Transfer & Trust Company and the Company (Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed by the Company on December 18, 2018)

Registration Rights Agreement dated October 28, 2019 (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

Voting Agreement dated October 28, 2019 (Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

Form of Indemnification Agreement (Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed by the Company on November 12, 2020)

Research and License Agreement, dated June 22, 2015, between BiomX Ltd.

and Yeda Research and Development Company Limited, as amended (Incorporated by reference to Exhibit 10.5 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Exclusive Patent License Agreement dated April 25, 2017, between BiomX Ltd.

and the Massachusetts Institute of Technology (Incorporated by reference to Exhibit 10.6 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Exclusive Patent License Agreement, dated December 15, 2017, among BiomX Ltd., Keio University and JSR Corporation, as amended (Incorporated by reference to Exhibit 10.7 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Exclusive Patent License Agreement, dated April 22, 2019, among BiomX Ltd., Keio University and JSR Corporation (Incorporated by reference to Exhibit 10.8 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

and Yeda Research and Development Company Limited, as amended (Incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

Exclusive Patent License Agreement, dated December 15, 2017, among BiomX Ltd., Keio University and JSR Corporation, as amended (Incorporated by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

Exclusive Patent License Agreement, dated April 22, 2019, among BiomX Ltd., Keio University and JSR Corporation (Incorporated by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

Share Purchase Agreement, dated November 19, 2017, among BiomX Ltd., RondinX Ltd.

and Guy Harmelin, as the Shareholders’

Representative (Incorporated by reference to Exhibit 10.9 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Representative (Incorporated by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

Chardan Healthcare Acquisition Corp.

2019 Equity Incentive Plan (Incorporated by reference to Exhibit 10.10 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

2015 Employee Stock Option Plan for Key Employees of BiomX Ltd., as amended (Incorporated by reference to Exhibit 99.1 to the registrant’s Registration Statement on Form S-8 filed by the registrant on January 2, 2020)

Waiver Agreement, dated October 28, 2019 (Incorporated by reference to Exhibit 10.11 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Purchase Agreement, dated October 28, 2019, between Cornix LLC and Chardan Healthcare Acquisition Corp.

(Incorporated by reference to Exhibit 10.12 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Waiver Letter to Voting Agreement (Incorporated by reference to Exhibit 10.13 to the registrant’s Current Report on Form 8-K filed by the registrant on November 4, 2019)

Letter Agreements, dated December 13, 2018, among the registrant and each of the initial stockholders, officer and directors of the registrant (Incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed by the registrant on December 18, 2018)

Stock Escrow Agreement, dated December 13, 2018, between the registrant, Continental Stock Transfer & Trust Company and the initial stockholders (Incorporated by reference to Exhibit 10.3 to the registrant’s Current Report on Form 8-K filed by the registrant on December 18, 2018)

Registration Rights Agreement, dated December 13, 2018, among the registrant and the initial stockholders and Chardan Capital Markets, LLC.

(Incorporated by reference to Exhibit 10.4 to the registrant’s Current Report on Form 8-K filed by the registrant on December 18, 2018)

Form of Subscription Agreement, dated December 13, 2018, among the registrant, the initial stockholders and Chardan Capital Markets, LLC (Incorporated by reference to Exhibit 10.5 to the registrant’s Registration Statement on Form S-1 filed by the registrant on December 4, 2018)

2019 Equity Incentive Plan (Incorporated by reference to Exhibit 10.10 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

2015 Employee Stock Option Plan for Key Employees of BiomX Ltd., as amended (Incorporated by reference to Exhibit 99.1 to the Company’s Registration Statement on Form S-8 filed by the Company on January 2, 2020)

Registration Rights Agreement, dated December 13, 2018, among the Company and the initial stockholders and Chardan Capital Markets, LLC.

(Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed by the Company on December 18, 2018)

Form of Non-Qualified Stock Option Agreement (U.S.

Awards to Non-Executives)

Awards to Non-Executives) (Incorporated by reference to Exhibit 10.19 to the Company’s Periodic Report on Form 10-K filed by the Company on March 26, 2020)

Form of Non-Qualified Stock Option Agreement (U.S.

Awards to Executive Officers)

Form of Option Agreement (Israeli Awards)

Subsidiaries of Registrant (Incorporated by reference to Exhibit 21.1 to the registrant’s Current Report on Form 8-K filed by the registrant on November 1, 2019)

Awards to Executive Officers) (Incorporated by reference to Exhibit 10.20 to the Company’s Periodic Report on Form 10-K filed by the Company on March 26, 2020)

Form of Option Agreement (Israeli Awards) (Incorporated by reference to Exhibit 10.21 to the Company’s Periodic Report on Form 10-K filed by the Company on March 26, 2020)

An addendum to a lease agreement dated from May 25, 2017, dated September 7, 2020 by and among AFI Assets Ltd., AF –

SHAR Ltd., WIS and BiomX Ltd.

(translated from Hebrew)

A lease agreement dated September 7, 2020 by and among AFI Assets Ltd., AF –

SHAR Ltd., WIS, Nova Measuring Systems Ltd.

and BiomX Ltd.

(translated from Hebrew)

Open Market Sale Agreement SM , dated December 4, 2020, between the Company and Jefferies LLC (incorporated by reference to Exhibit 1.2 of the Company’s Registration Statement on Form S-3 filed by the Company on December 4, 2020).

Subsidiaries of Company (Incorporated by reference to Exhibit 21.1 to the Company’s Current Report on Form 8-K filed by the Company on November 1, 2019)

Consent of Brightman Almagor Zohar & Co., independent registered public accounting firm

Certification of Chief Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended.

Certification of Chief Financial Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended.

Certification of Chief Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a).

Certification of Chief Financial Officer pursuant to Rule 13a-14 and Rule 15d-14(a).

Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Portions of this exhibit have been omitted pursuant to Rule 601(b)(10) of Regulation S-K.

The omitted information is not material and would likely cause competitive harm to the registrant if publicly disclosed.

Indicates a management contract or a compensatory plan or agreement.

to the requirements of Section 13 or 15(d) of the Exchange Act of 1934, the registrant caused this report to be signed on

its behalf by the undersigned, thereunto duly authorized.

Section 1350.

XBRL Instance Document

XBRL Taxonomy Extension Schema Document

XBRL Taxonomy Extension Calculation Linkbase

XBRL Taxonomy Extension Definition Linkbase

XBRL Taxonomy Extension Label Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase

Portions of this exhibit have been

omitted pursuant to Rule 601(b)(10) of Regulation S-K.

The omitted information is not material and would likely cause competitive

harm to the Company if publicly disclosed.

Indicates a management contract

or a compensatory plan or agreement.

Form 10-K Summary

Pursuant to the requirements of Section 13 or 15(d) of

the Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

March 30, 2021

Jonathan Solomon

Executive Officer

ALL PERSONS BY THESE PRESENTS, that each of the undersigned constitutes and appoints Mr.

Jonathan Solomon, Ms.

Marina Wolfson

Sailaja Puttagunta, and each or any one of them, as the undersigned’s true and lawful attorneys-in-fact and agents,

with full powers of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead,

in any and all capacities, to sign any and all amendments (including pre-effective and post-effective amendments) to this Annual

Report on Form 10-K and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities

and Exchange Commission, granting unto such attorneys-in-fact and agents, full power and authority to do and perform each and

every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as the undersigned

might or could do in person, hereby ratifying and confirming all that such attorneys-in-fact and agents, or their substitute or

substitutes, may lawfully do or cause to be done by virtue hereof.

to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf

of the registrant and in the capacities and on the dates indicated.

Jonathan Solomon

Chief Executive

Pursuant to the requirements of the Securities

Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Company and in the capacities

and on the dates indicated.

Russell Greig

Chairman of the Board

Chairman of the Board of Directors

March 30, 2021

1 unchanged sentence

Jonathan Solomon

Executive Officer

Chief Executive Officer

March 30, 2021

2 unchanged sentences

Marina Wolfson

President of Finance and Operations

Senior Vice President of Finance and Operations

March 30, 2021

Marina Wolfson

(Principal Financial

Officer and Principal Accounting Officer)

March 26, 2020

Erez Chimovits

(Principal Financial Officer and Principal Accounting

March 30, 2021

Erez Chimovits

Jonas Grossman

1 unchanged sentence

Jonas Grossman

Lynne Sullivan

March 30, 2021

Lynne Sullivan

Robbie Woodman

March 30, 2021

Robbie Woodman

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

Lynne Sullivan

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2020

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP.)

CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2020

OF INDEPENDENT REGISTERED ACCOUNTING FIRM

FINANCIAL STATEMENTS:

Balance Sheets

Statements of Comprehensive Loss

Statements of Changes in Shareholders’

Statements of Cash Flows

to the Consolidated Financial Statements

REPORT OF INDEPENDENT

REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and

Board of Directors of BiomX Inc.

Opinion on the Financial

We have audited the accompanying consolidated

balance sheets of BiomX Inc.

(the “Company”) as of December 31, 2019 and 2018, the related consolidated statements

of comprehensive loss, changes in shareholders’

equity and cash flows for each of the two years in the period ended December

31, 2019, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial

statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018 and

the results of its operations and its cash flows for each of the two years in the period ended December 31, 2019, in conformity

with accounting principles generally accepted in the United States of America.

REPORT OF INDEPENDENT REGISTERED ACCOUNTING

CONSOLIDATED FINANCIAL STATEMENTS:

Consolidated Balance Sheets

Consolidated Statements

of Operations

Consolidated Statements of Changes in Stockholders’

Consolidated Statements of Cash Flows

Notes to the Consolidated Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors of BiomX Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets

of BiomX Inc.

(the “Company”) as of December 31, 2020 and 2019, the related consolidated statements of comprehensive

loss, changes in stockholders’

equity and cash flows for each of the two years in the period ended December 31, 2020, and

the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in

all material respects, the financial position of the Company as of December 31, 2020 and 2019 and the results of its operations

and its cash flows for each of the two years in the period ended December 31, 2020, in conformity with accounting principles generally

accepted in the United States of America.

Change in Accounting Principle

As discussed in Note 2

to the financial statements, effective January 1, 2019, the Company adopted the FASB’s new standard related to leases using

the modified retrospective approach.

discussed in Note 2 to the financial statements, effective January 1, 2019, the Company adopted the Financial Accounting Standards

Board’s new standard related to leases using the modified retrospective approach.

Basis for Opinion

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on

the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting

Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits

in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable

assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

our audits, we are required to obtain an understanding of internal control over financial reporting 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.

Our audits included performing

procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing

procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and

disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates

made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide

a reasonable basis for our opinion.

Brightman Almagor Zohar &

These financial statements are the responsibility of the Company’s

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required

to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and

regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial

statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we

engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain

an understanding of internal control over financial reporting 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.

Our audits included performing procedures to assess the risks

of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial

Our audits also included evaluating the accounting principles used and significant estimates made by management, as

well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis

for our opinion.

/s/ Brightman Almagor Zohar & Co.

Certified Public Accountants

A Firm in the Deloitte Global

A Firm in the Deloitte Global Network

Tel Aviv, Israel

March 31, 2021

We have served as the Company’s

auditor since 2015.

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

have served as the Company’s auditor since 2015.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP.)

CONSOLIDATED BALANCE SHEETS

15 unchanged sentences

Total non-current assets

accompanying Notes are an integral part of the consolidated financial statements.

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

The accompanying Notes are an integral

part of the consolidated financial statements.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP.)

CONSOLIDATED BALANCE SHEETS

2 unchanged sentences

As of December 31,

LIABILITIES AND SHAREHOLDERS’

LIABILITIES AND STOCKHOLDERS’

Current liabilities

2 unchanged sentences

Other account payables

Related parties

Total current liabilities

Non-current liabilities

Lease liabilities –

net of current portion

Lease liabilities, net of current portion

Contingent liabilities

1 unchanged sentence

Commitments and Contingent Liabilities

Shareholders’

Common stock shares, $0.0001 par value (“Ordinary Shares”);

Authorized 60,000,000 and 33,954,304 shares as of December 31, 2019 and 2018, respectively.

Issued and outstanding 22,862,835 and 2,307,871 as of December 31, 2019 and 2018, respectively.

Preferred A shares (pre-merger - BiomX Ltd.) (“Preferred A Shares”);

NIS 0.01 par value;

Authorized 16,430,668 shares as of December 31, 2018.

Issued and outstanding 7,543,831 shares as of December 31, 2018.

Preferred B shares (pre-merger - BiomX Ltd.) (“Preferred B Shares”);

NIS 0.01 par value;

Authorized 6,858,371 shares as of December 31, 2018.

Issued and outstanding 5,170,357 shares as of December 31, 2018.

Stockholders’

Common stock, $0.0001 par value (“Common Stock”);

Authorized - 60,000,000 shares as of December 31, 2020 and 2019.

Issued - 23,270,337 and 22,862,835 as of December 31,2020

and 2019, respectively.

Outstanding - 23,264,637 and 22,862,835 as of December 31, 2020 and 2019, respectively.

Additional paid in capital

Accumulated deficit

Total shareholders’

(*) Less than $1 thousand.

** Number of shares has been retroactively

adjusted based on the equivalent number of shares received by the accounting acquirer in the reverse recapitalization transaction

(refer to Note 1).

accompanying Notes are an integral part of the consolidated financial statements.

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE

Total Stockholders’

The accompanying Notes are an integral

part of the consolidated financial statements.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP.)

CONSOLIDATED STATEMENTS OF OPERATIONS

(USD in thousands, except share and

per share data)

Research and development (“R&D”) expenses, net

Research and development expenses, net

General and administrative expenses

Operating loss

Finance expenses (income), net

Finance income, net

Loss before income tax

Basic and diluted loss per Ordinary Shares

Weighted average number of Ordinary Shares outstanding, basic and diluted

** Number of shares has been retroactively

adjusted based on the equivalent number of shares received by the accounting acquirer in the reverse recapitalization transaction

(refer to Note 1).

accompanying Notes are an integral part of the consolidated financial statements.

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

CONSOLIDATED STATEMENTS OF CHANGES

IN SHAREHOLDERS’

Basic and diluted loss per share of Common Stock

Weighted average number of shares of Common Stock outstanding,

basic and diluted

Number of shares has

been retroactively adjusted based on the equivalent number of shares received by the accounting acquirer in the Recapitalization

Transaction (refer to Note 1).

The accompanying Notes are an integral

part of the consolidated financial statements.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP.)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’

(USD in thousands, except share and

2 unchanged sentences

(pre-merger -

shareholders’

Balance as of January 1, 2018

Issuance of shares (**)

Conversion of Ordinary to Ordinary A Shares

Share-based payment

Exercise of options

Balance as of December 31, 2018

Issuance of shares (***)

Effect of reverse recapitalization transaction

Acquisition of treasury stock

Share-based payment

Exercise of options

Balance as of December 31, 2019

(*) Less than $1 thousand.

(**) Net of issuance expenses in amount of

$73 thousand.

(***) Net of issuance expenses in amount

of $114 thousand.

** Number of shares has been retroactively

adjusted based on the equivalent number of shares received by the accounting acquirer in the reverse recapitalization transaction

(refer to Note 1).

accompanying Notes are an integral part of the consolidated financial statements.

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

Stockholder’

as of January 1, 2019

of treasury stock

of shares (**)

of Recapitalization Transaction

of stock options

as of December 31, 2019

of Common Stock under Open Market Sales Agreement (***)

of stock options

as of December 31, 2020

Less than $1.

Net of issuance

expenses of $114.

Net of issuance

expenses of $158.

Number of shares

has been retroactively adjusted based on the equivalent number of shares received by the accounting acquirer in the Recapitalization

Transaction (refer to Note 1).

The accompanying Notes are an integral

part of the consolidated financial statements.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP.)

CONSOLIDATED STATEMENTS OF CASH FLOWS

4 unchanged sentences

Adjustments required to reconcile net loss to cash flows used in operating activities

Share-based compensation

Depreciation and amortization

Stock-based compensation

Revaluation of contingent liabilities

8 unchanged sentences

INVESTING ACTIVITIES

Increase (decrease) in short-term deposits

Decrease (Increase) in short-term deposits

Purchase of property and equipment

Net cash used (provided by) in investing activities

Net cash provided by (used in) investing activities

CASH FLOWS –

FINANCING ACTIVITIES

Issuance of preferred shares, net of issuance costs

Cash acquired in connection with the reverse recapitalization transaction, net

Issuance of Common Stock, net of issuance costs

Outflows in connection with current assets and liabilities acquired in Recapitalization Transaction

Acquisition of treasury stock

1 unchanged sentence

Net cash provided by financing activities

Increase in cash and cash equivalents and restricted cash

Cash and cash equivalents and restricted cash at the beginning of the year

Cash and cash equivalents and restricted cash at the end of the year

(*) Less than $1 thousand.

accompanying Notes are an integral part of the consolidated financial statements.

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

Increase (decrease) in cash and cash equivalents and restricted cash

Cash and cash equivalents and restricted cash at the

beginning of the year

Cash and cash equivalents and restricted cash at the

end of the year

The accompanying Notes are an integral

part of the consolidated financial statements.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP.)

CONSOLIDATED STATEMENTS OF CASH FLOWS

USD In thousands

(USD in thousands, except share and

per share data)

SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES:

Recognition of right-of-use asset and lease liability upon adoption of ASU 2016-02

Recognition of right-of-use asset and lease liability upon adoption

of ASU 2016-02

Assets acquired under operating leases

Assets acquired (liabilities assumed) in reverse

recapitalization transaction:

Assets acquired (liabilities assumed) in Recapitalization

Current assets (excluding cash and cash equivalents)

Current liabilities

Reverse recapitalization effect on equity

Cash acquired in connection with reverse recapitalization transaction

accompanying Notes are an integral part of the consolidated financial statements.

(FORMERLY CHARDAN

HEALTHCARE ACQUISITION CORP)

Recapitalization Transaction effect on equity

Cash acquired in connection with Recapitalization Transaction

The accompanying Notes are an integral

part of the consolidated financial statements.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - GENERAL

(USD in thousands, except share and

per share data)

General information:

(together with its

subsidiaries, BiomX Ltd.

and RondinX Ltd., the “Company”

or “BiomX”

and formerly known as Chardan Healthcare

Acquisition Corp.) was incorporated as a blank check company on November 1, 2017, under the laws of the state of Delaware, for

the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar

business combination with one or more businesses or entities.

On July 16, 2019, the Company

entered into a merger agreement with BiomX Ltd.

(“BiomX Israel”), a company incorporated under the laws of Israel,

CHAC Merger Sub Ltd.

(“Merger Sub”) and Shareholder Representative Services LLC (“SRS”), as amended on

October 11, 2019, pursuant to which, among other things, BiomX Israel merged with Merger Sub, with BiomX Israel being the surviving

entity in accordance with the Israeli Companies Law, 5759-1999, as a wholly owned direct subsidiary of BiomX Inc.

On October 28, 2019, the Company

acquired 100% of the outstanding shares of BiomX Israel (the “Recapitalization Transaction”).

Pursuant to the aforementioned

merger agreement, in exchange for all of the outstanding shares of BiomX Israel, the Company issued to the shareholders of BiomX

Israel a total of 15,069,058 shares of the Company’s Common Stock representing approximately 65% of the total shares issued

and outstanding after giving effect to the Recapitalization Transaction.

As a result of the Recapitalization Transaction, BiomX

Israel became a wholly owned subsidiary of the Company.

As the shareholders of BiomX Israel received the largest ownership interest

in the Company, BiomX Israel was determined to be the “accounting acquirer”

in the reverse recapitalization.

the historical financial statements of the Company were replaced with the financial statement of BiomX Israel for all periods presented.

Following the Recapitalization

Transaction, the Company retained $60.1 million held in a trust account, after redemptions of IPO shares held by certain shareholders

(formerly known as Chardan Healthcare

Acquisition Corp., individually prior to the Recapitalization Transaction (as defined below), and together with its subsidiaries,

and RondinX Ltd.

after the Recapitalization Transaction, the “Company”

or “BiomX”) was incorporated

as a blank check company on November 1, 2017, under the laws of the state of Delaware, for the purpose of entering into a merger,

stock exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar business combination with one or

more businesses or entities.

On July 16, 2019, the Company entered into a merger

agreement with BiomX Ltd.

(“BiomX Israel”), a company incorporated under the laws of Israel, CHAC Merger Sub Ltd.

(“Merger Sub”) and Shareholder Representative Services LLC, as amended on October 11, 2019, pursuant to which, among

other things, BiomX Israel merged with Merger Sub, with BiomX Israel being the surviving entity in accordance with the Israeli

Companies Law, 5759-1999, as a wholly owned direct subsidiary of BiomX Inc.

On October 28, 2019, the Company consummated the

acquisition of 100% of the outstanding shares of BiomX Israel (the “Recapitalization Transaction”).

Pursuant to the

aforementioned merger agreement, in exchange for all of the outstanding shares of BiomX Israel, the Company issued to the shareholders

of BiomX Israel a total of 15,069,058 shares of the Company’s Common Stock representing approximately 65% of the total shares

issued and outstanding after giving effect to the Recapitalization Transaction.

As a result of the Recapitalization Transaction,

BiomX Israel became a wholly owned subsidiary of the Company.

As the shareholders of BiomX Israel received the largest ownership

interest in the Company, BiomX Israel was determined to be the “accounting acquirer”

in the Recapitalization Transaction.

As a result, the historical financial statements of the Company were replaced with the financial statement of BiomX Israel for

all periods presented.

Following the Recapitalization Transaction, the

Company retained $60,100 held in a trust account, after redemptions of shares held by certain shareholders in connection with

the initial public offering of Chardan Healthcare Acquisition Corp.

(refer to Note 12A).

The number of shares and instruments

convertible into shares included within these financial statements have been retroactively adjusted based on the equivalent number

of shares received by the accounting acquirer in the Recapitalization Transaction.

The Commons Stock of the Company

began trading on the NYSE American stock exchange on October 28, 2019 and the Company was renamed BiomX Inc.

Commencing October 29, 2019,

the Company’s shares of Common Stock, units, and warrants are traded under the symbols PHGE, PHGE.U, and PHGE.WS, respectively.

On February 6, 2020, the Company’s

Common Stock also began trading on the Tel-Aviv Stock Exchange.

The number of shares and instruments convertible

into shares included within these financial statements have been retroactively adjusted based on the equivalent number of shares

received by the accounting acquirer in the Recapitalization Transaction.

On October 28, 2019, the Company was renamed BiomX

and the Company’s shares of Common Stock, units, and warrants began trading on the NYSE American under the symbols

PHGE, PHGE.U, and PHGE.WS, respectively.

On February 6, 2020, the Company’s Common

Stock also began trading on the Tel-Aviv Stock Exchange.

Risk factors:

To date, the Company has not

generated revenue from its operations.

As of December 31, 2019, the Company had unrestricted cash and cash equivalent balance of

approximately $72 million and short-term deposits of approximately $10 million, which management believes is sufficient to fund

its operations for more than 12 months from the date of issuance of these financial statements and sufficient to fund its operations

To date, the Company has not generated revenue from

its operations.

As of December 31, 2020, the Company had a cash and cash equivalents and restricted cash balance of approximately

$37,239 and short-term deposits of approximately $19,851, which management believes is sufficient to fund its operations for more

than 12 months from the date of issuance of these condensed consolidated financial statements and sufficient to fund its operations

necessary to continue development activities of its current proposed products.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - GENERAL (Cont.)

(USD in thousands, except share and

per share data)

GENERAL (Cont.)

Risk factors:

Consistent with its continuing

R&D activities, the Company expects to continue to incur additional losses for the foreseeable future.

The Company plans to

continue to fund its current operations, as well as other development activities relating to additional product candidates, through

future issuances of debt and/or equity securities and possibly additional grants from the IIA and other government institutions.

The Company’s ability to raise additional capital in the equity and debt markets is dependent on a number of factors including,

but not limited to, the market demand for the Company’s Common Stock, which itself is subject to a number of development

and business risks and uncertainties, as well as the uncertainty that the Company would be able to raise such additional capital

at a price or on terms that are favorable to the Company.

Use of estimates in the preparation of financial statements:

The preparation of financial

statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that

affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities in the financial statements

and the amounts of expenses during the reported years.

Actual results could differ from those estimates.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

The significant

accounting policies applied in the preparation of the financial statements on a consistent basis, are as follows, except for the

adoption of new accounting standards:

Consistent with its continuing research and development

activities, the Company expects to continue to incur additional losses for the foreseeable future.

The Company plans to continue

to fund its current operations, as well as other development activities relating to additional product candidates, through future

issuances of debt and/or equity securities and possibly additional grants from the Israel Innovation Authority (“IIA”)

and other government institutions.

The Company’s ability to raise additional capital in the equity and debt markets is dependent

on a number of factors including, but not limited to, the market demand for the Company’s Common Stock, which itself is

subject to a number of development and business risks and uncertainties, as well as the uncertainty that the Company would be

able to raise such additional capital at a price or on terms that are favorable to it.

SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies applied in the

preparation of the financial statements on a consistent basis, are as follows, except for the adoption of new accounting standards:

Basis of presentation and principles of consolidation:

The accompanying consolidated

financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and

The accompanying consolidated financial statements

have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and

include the accounts of the Company and its wholly owned subsidiaries, BiomX Israel and RondinX Ltd.

1 unchanged sentence

and transactions have been eliminated in consolidation.

Functional currency and foreign currency translation:

The functional currency of

the Company is the U.S dollar (“dollar”) since the dollar is the currency of the primary economic environment in which

the Company has operated and expects to continue to operate in the foreseeable future.

Transactions and balances

denominated in dollars are presented at their original amounts.

Transactions and balances denominated

in foreign currencies have been re-measured to dollars in accordance with the provisions of ASC 830-10, “Foreign Currency

Matters.”

All transaction gains and losses from remeasurement of monetary

balance sheet items denominated in foreign currencies are reflected in the statements of comprehensive loss as financial income

Use of estimates in the preparation of financial

The preparation of financial statements in conformity

with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and

disclosure of contingent assets and liabilities in the financial statements and the amounts of expenses during the reported years.

Actual results could differ from those estimates.

Reclassification

Certain prior year amounts have been reclassified

to conform to the current year presentation.

Functional currency and foreign currency

The functional currency of the Company is the U.S.

dollar (“dollar”) since the dollar is the currency of the primary economic environment in which the Company has operated

and expects to continue to operate in the foreseeable future.

Transactions and balances denominated in dollars

are presented at their original amounts.

Transactions and balances denominated in foreign

currencies have been re-measured to dollars in accordance with the provisions of ASC 830-10, “Foreign Currency Matters.”

All transaction gains and losses from remeasurement

of monetary balance sheet items denominated in foreign currencies are reflected in the statements of operations as financial income

or expenses, as appropriate.

Cash and cash equivalents:

The Company considers all

highly liquid investments, including unrestricted short-term bank deposits purchased with original maturities of three months

or less, to be cash equivalents.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

The Company considers all highly liquid investments,

including unrestricted short-term bank deposits purchased with original maturities of three months or less, to be cash equivalents.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Short-term deposits:

Short-term deposits represent

time deposits placed with banks with original maturities of greater than three months but less than one year.

Interest earned is

recorded as finance income in the consolidated statements of comprehensive loss during the years for which the Company held short-term

As of December 31, 2019, the

Company has a deposit dominated in USD at BHI USA that bears fixed annual interest of 2.1%.

As of December 31, 2018, the Company

had deposits at Leumi Bank (Israel) and BHI USA that bore fixed annual interest between 2.8% and 3.6%.

(USD in thousands, except share and

per share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Concentrations of credit risk:

Financial instruments which

potentially subject us to credit risk consist primarily of cash, cash equivalents, and short-term deposits.

These amounts at times

may exceed federally insured limits.

We have not experienced any credit losses in such accounts and do not believe we are exposed

to any significant credit risk on these funds.

We have no off-balance sheet concentrations of credit risk, such as foreign currency

exchange contracts, option contracts, or other hedging arrangements.

Financial instruments which potentially subject

us to credit risk consist primarily of cash, cash equivalents, and short-term deposits.

These amounts at times may exceed federally

insured limits.

We have not experienced any credit losses in such accounts and do not believe we are exposed to any significant

credit risk on these funds.

The Company uses foreign exchange contracts (mainly

option and forward contracts) to hedge cash flows from currency exposure.

These foreign exchange contracts are not designated

as hedging instruments for accounting purposes.

In connection with these foreign exchange contracts, the Company recognizes gains

or losses that offset the revaluation of the cash flows also recorded under financial expenses (income), net in the consolidated

statements of operations.

As of December 31, 2020, the Company had outstanding foreign exchange contracts in the amount of approximately

As of December 31, 2019, the Company had no outstanding foreign exchange contracts.

Property and equipment:

and equipment are presented at cost less accumulated depreciation.

Depreciation is calculated based on the straight-line method

over the estimated useful lives of the related assets or terms of the related leases, as follows:

Estimated Useful Lives

Property and equipment are presented at cost less

accumulated depreciation.

Depreciation is calculated based on the straight-line method over the estimated useful lives of the

related assets or terms of the related leases, as follows:

Laboratory equipment

2 unchanged sentences

Leasehold improvements

Shorter of lease term or useful life

In accordance with ASC 360-10,

management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount

of an asset may not be recoverable based on estimated future undiscounted cash flows.

If so indicated, an impairment loss would

be recognized for the difference between the carrying amount of the asset and its fair value .

For the years ended December

31, 2019, and 2018, no impairment expenses were recorded.

Shorter of lease

term or useful life

In accordance with ASC 360-10, “Impairment

and Disposal of Long-Lived Assets”, management reviews long-lived assets for impairment whenever events or changes in circumstances

indicate that the carrying amount of an asset may not be recoverable based on estimated future undiscounted cash flows.

indicated, an impairment loss would be recognized for the difference between the carrying amount of the asset and its fair value.

For the years ended December 31, 2020 and 2019, no impairment expenses were recorded.

Intangible assets:

Intangible R&D assets

acquired in a business combination (IPR&D) are recognized at fair value as of the acquisition date and subsequently accounted

for as indefinite-lived intangible assets until completion or abandonment of the associated R&D efforts.

Indefinite-lived intangible

assets are reviewed for impairment at least annually or whenever there is an indication that the asset may be impaired.

Intangible research and development assets acquired

in a business combination are recognized at fair value as of the acquisition date and subsequently accounted for as indefinite-lived

intangible assets until completion or abandonment of the associated R&D efforts.

Indefinite-lived intangible assets are reviewed

for impairment at least annually or whenever there is an indication that the asset may be impaired.

Income taxes:

Company provides for income taxes using the asset and liability approach.

Deferred tax assets and liabilities are recorded based

on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these

differences are expected to reverse.

Deferred tax assets are reduced by a valuation allowance if, based on the weight of available

evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

As of December 31, 2019

and 2018, the Company had a full valuation allowance against deferred tax assets.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

The Company provides for income taxes using the

asset and liability approach.

Deferred tax assets and liabilities are recorded based on the differences between the financial

statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse.

Deferred tax assets are reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than

not that some or all the deferred tax assets will not be realized.

As of December 31, 2020 and 2019, the Company had a full valuation

allowance against deferred tax assets.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Cont.)

(USD in thousands, except share and

per share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Income taxes:

The Company is subject to

the provisions of ASC 740-10-25, Income Taxes (ASC 740).

The Company is subject to the provisions of ASC

740-10-25, “Income Taxes”

(“ASC 740”).

ASC 740 prescribes a more likely-than-not threshold for the financial

8 unchanged sentences

Fair value of financial instruments:

The Company accounts for financial

instruments in accordance with ASC 820, “Fair Value Measurements and Disclosures”

The Company accounts for financial instruments in

accordance with ASC 820, “Fair Value Measurements and Disclosures”

(“ASC 820”).

establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.

The hierarchy

gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements)

and the lowest priority to unobservable inputs (Level 3 measurements).

The three levels of the fair value hierarchy under ASC

820 are described below:

ASC 820 establishes a fair

value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.

The hierarchy gives the highest

priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest

priority to unobservable inputs (Level 3 measurements).

The three levels of the fair value hierarchy under ASC 820 are described

Level 1 –

quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Unadjusted quoted prices in active

markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2 –

Quoted prices

in non-active markets or in active markets for similar assets or liabilities, observable inputs other than quoted prices, and

inputs that are not directly observable but are corroborated by observable market data.

Quoted prices in non-active markets

or in active markets for similar assets or liabilities, observable inputs other than quoted prices, and inputs that are not directly

observable but are corroborated by observable market data.

Level 3 –

valuations that require inputs that are both significant to the fair value measurement and unobservable.

were no changes in the fair value hierarchy levelling during the years ended December 31, 2019 and 2018.

following table summarizes the fair value of our financial assets and liabilities that were accounted for at fair value on a recurring

basis, by level within the fair value hierarchy (USD in thousands):

Prices or valuations that require

inputs that are both significant to the fair value measurement and unobservable.

There were no changes in the fair value hierarchy

levelling during the years ended December 31, 2020 and 2019.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(USD in thousands, except share and

per share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Fair value of financial instruments:

The following table summarizes the fair value of

our financial assets and liabilities that were accounted for at fair value on a recurring basis, by level within the fair value

December 31, 2020

Cash equivalents:

Money market funds

Contingent liabilities

December 31, 2019

Cash equivalents:

Money market funds

Contingent liabilities

Financial instruments with

carrying values approximating fair value include cash and cash equivalents, restricted cash, short-term deposits, other current

assets, trade accounts payable and other current liabilities, due to their short-term nature.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

Financial instruments with carrying values approximating

fair value include cash and cash equivalents, restricted cash, short-term deposits, other current assets, trade accounts payable

and other current liabilities, due to their short-term nature.

Defined contribution plans:

Under Israeli employment laws, employees of BiomX

Israel are included under Section 14 of the Severance Compensation Act, 1963 (“Section 14”) for a portion of their

Pursuant to Section 14, these employees are entitled to monthly deposits made by the Company on their behalf with insurance

Payments in accordance with Section 14 release the

Company from any future severance payments (under the Israeli Severance Compensation Act, 1963) with respect of those employees.

The aforementioned deposits are not recorded as an asset on the Company’s balance sheet, and there is no liability recorded

as the Company does not have a future obligation to make any additional payments.

The Company’s contributions to the defined

contribution plans are charged to the consolidated statements of operations as and when the services are received from the Company’s

Total expenses with respect to these contributions were $567 and $381 for the years ended December 31, 2020 and 2019,

respectively.

employees the Company has a defined contribution

savings plan under Section 401(k) of the Internal Revenue Code.

This plan covers substantially all employees of BiomX Inc in the

who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a

pre-tax basis.

The Company has not elected to match any of the

employee’s deferral.

During the years ended December 31, 2020 and 2019 the Company did not record any expenses for 401(k)

match contributions.

Research and development costs:

Research and development costs are charged to statements

of operations as incurred.

Royalty-bearing grants from the IIA are recognized at the time the Company is entitled to such grants,

on the basis of the costs incurred and applied as a deduction from research and development expenses.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Cont.)

costs are charged to statements of comprehensive loss as incurred.

Royalty-bearing grants from

the Israel Innovation Authorities (“IIA”) are recognized at the time the Company is entitled to such grants, on the

basis of the costs incurred and applied as a deduction from research and development expenses

(USD in thousands, except share and

per share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Basic and diluted loss per share:

loss per share is computed by dividing net loss by the weighted average number of ordinary shares outstanding during the year.

Diluted loss per share is computed by dividing net loss by the weighted average number of ordinary shares outstanding during the

year, plus the number of ordinary shares that would have been outstanding if all potentially dilutive ordinary shares had been

issued, using the treasury stock method, in accordance with ASC 260-10 “Earnings per Share.”

Potentially dilutive

ordinary shares were excluded from the calculation of diluted loss per share for all periods presented due to their anti-dilutive

effect due to losses in each period.

Defined contribution plans:

Israeli employment laws, employees of BiomX Israel are included under Article 14 of the Severance Compensation Act, 1963 (“Article

14”) for a portion of their salaries.

According to Article 14, these employees are entitled to monthly deposits made by

the Company on their behalf with insurance companies.

in accordance with Article 14 release the Company from any future severance payments (under the Israeli Severance Compensation

Act, 1963) with respect of those employees.

The aforementioned deposits are not recorded as an asset on the Company’s balance

sheet, and there is no liability recorded as the Company does not have a future obligation to make any additional payments.

Company’s contributions to the defined contribution plans are charged to the consolidated statements of comprehensive loss

as and when the services are received from the Company’s employees.

Total expenses with respect to these contributions were

$381 thousand and $283 thousand for the years ended December 31, 2019 and 2018, respectively.

Basic loss per share is computed by dividing net

loss by the weighted average number of shares of Common Stock outstanding during the year.

Diluted loss per share is computed

by dividing net loss by the weighted average number of shares of Common Stock outstanding during the year, plus the number of

shares of Common Stock that would have been outstanding if all potentially dilutive shares of Common Stock had been issued, using

the treasury stock method, in accordance with ASC 260-10 “Earnings per Share.”

Potentially dilutive shares of Common

Stock were excluded from the calculation of diluted loss per share for all periods presented due to their anti-dilutive effect

due to losses in each period.

Stock compensation plans:

The Company applies ASC 718-10,

“Share-Based Payment,”

(“ASC 718-10”) which requires the measurement and recognition of compensation expenses

for all share-based payment awards made to employees and directors including employee stock options under the Company’s

stock plans based on estimated fair values.

ASC 718-10 requires companies

to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model.

The fair value of

the award is recognized as an expense over the requisite service periods in the Company’s statements of comprehensive loss.

The Company recognizes share-based award forfeitures as they occur rather than estimate by applying a forfeiture rate.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

The Company applies ASC 718-10, “Stock-Based

Payment,”

(“ASC 718-10”) which requires the measurement and recognition of compensation expenses for all stock-based

payment awards made to employees and directors including employee stock options under the Company’s stock plans based on

estimated fair values.

ASC 718-10 requires companies to estimate the fair

value of stock-based payment awards on the date of grant using an option-pricing model.

The fair value of the award is recognized

as an expense over the requisite service periods in the Company’s statements of operations.

The Company recognizes stock-based

award forfeitures as they occur rather than estimate by applying a forfeiture rate.

All issuances of stock options or other equity instruments

to non-employees as consideration for goods or services received by the Company are accounted for based on the fair value of the

equity instruments issued.

The Company recognizes compensation expense for

the fair value of non-employee awards over the requisite service period of each award.

In June 2018, the Financial Accounting Standards

Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-07, “Compensation-Stock Compensation

Improvements to Nonemployee Stock-Based Payment Accounting,”

which simplifies the accounting for nonemployee

stock-based payment transactions by aligning the measurement and classification guidance, with certain exceptions, to that for

stock-based payment awards to employees.

The amendments expand the scope of the accounting standard for stock-based payment awards

to include stock-based payment awards granted to non-employees in exchange for goods or services used or consumed in an entity’s

own operations and supersedes the guidance related to equity-based payments to non-employees.

The Company adopted these amendments

on January 1, 2019.

The adoption of these amendments did not have a material impact on the consolidated financial statements and

related disclosures.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Cont.)

(USD in thousands, except share and

per share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Stock compensation plans:

All issuances of stock options

or other equity instruments to non-employees as consideration for goods or services received by the Company are accounted for

based on the fair value of the equity instruments issued.

The Company recognizes compensation

expense for the fair value of non-employee awards over the requisite service period of each award.

June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

2018-07, “Compensation-Stock Compensation (Topic 718):

Improvements to Nonemployee Share-Based Payment Accounting”,

which simplifies the accounting for nonemployee share-based payment transactions by aligning the measurement and classification

guidance, with certain exceptions, to that for share-based payment awards to employees.

The amendments expand the scope of the

accounting standard for share-based payment awards to include share-based payment awards granted to non-employees in exchange

for goods or services used or consumed in an entity’s own operations and supersedes the guidance related to equity-based

payments to non-employees.

The Company adopted these amendments on January 1, 2019.

The adoption of these amendments did not have

a material impact on the consolidated financial statements and related disclosures.

The Company estimates the

fair value of stock options granted as equity awards using a Black-Scholes options pricing model.

The option-pricing model requires

a number of assumptions, of which the most significant are share price, expected volatility and the expected option term (the

time from the grant date until the options are exercised or expire).

Expected volatility is estimated based on volatility of similar

companies in the technology sector.

The Company estimates the fair value of stock options

granted as equity awards using a Black-Scholes option-pricing model.

The option-pricing model requires a number of assumptions,

of which the most significant are share price, expected volatility and the expected option term (the time from the grant date

until the options are exercised or expire).

Expected volatility is estimated based on volatility of similar companies in the technology

The Company has historically not paid dividends and has no foreseeable plans to issue dividends.

The risk-free interest rate is based on the yield from governmental zero-coupon bonds with an equivalent term.

The expected option

term is calculated for options granted to employees and directors using the “simplified”

Grants to non-employees

are based on the contractual term.

Changes in the determination of each of the inputs can affect the fair value of the options

granted and the results of operations of the Company.

ASU 2016-02, “Leases

(Topic 842)”

was issued by the FASB in February 2016.

The Company adopted this ASU 2016-02 effective January 1, 2019 using

the modified retrospective application, applying the new standard to leases in place as of the adoption date.

Prior periods have

not been adjusted.

Leases existing for the reporting period beginning January 1, 2019 are presented under ASU 2016-02.

that are determined to be leases at inception are recognized as long-term operating lease assets and lease liabilities in the

consolidated balance sheet at lease commencement.

Operating lease liabilities are recognized based on the present value of the

future lease payments over the lease term at commencement date.

As the rates implicit in the Company’s leases are not reasonably

determinable, the Company applies its incremental borrowing rate based on the economic environment at the commencement date in

determining the present value of future lease payments.

Lease terms include options to extend the lease when it is reasonably

certain that the Company will exercise that option.

Lease expense for operating leases are recognized on a straight-line basis

over the lease term.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Cont.)

The risk-free interest

rate is based on the yield from governmental zero-coupon bonds with an equivalent term.

The expected option term is calculated

for options granted to employees and directors using the “simplified”

Grants to non-employees are based on

the contractual term.

Changes in the determination of each of the inputs can affect the fair value of the options granted and

the results of operations of the Company.

ASU 2016-02, “Leases (Topic 842)”

issued by the FASB in February 2016.

The Company adopted this ASU 2016-02 effective January 1, 2019 using the modified retrospective

application, applying the new standard to leases in place as of the adoption date.

Prior periods have not been adjusted.

existing for the reporting period beginning January 1, 2019 are presented under ASU 2016-02.

Arrangements that are determined to be leases at

inception are recognized as long-term operating lease assets and lease liabilities in the consolidated balance sheet at lease

commencement.

Operating lease liabilities are recognized based on the present value of the future lease payments over the lease

term at commencement date.

As the rates implicit in the Company’s leases are not reasonably determinable, the Company applies

its incremental borrowing rate based on the economic environment at the commencement date in determining the present value of

future lease payments.

Lease terms include options to extend the lease when it is reasonably certain that the Company will exercise

Lease expenses for operating leases are recognized on a straight-line basis over the lease term.

The Company elected to adopt a package of practical expedients

3 unchanged sentences

the Company has made a policy election not to capitalize leases with a term of 12 months or less.

In accordance with ASC 360-10,

management reviews operating lease assets for impairment whenever events or changes in circumstances indicate that the carrying

amount of an asset may not be recoverable based on estimated future undiscounted cash flows.

If so indicated, an impairment loss

would be recognized for the difference between the carrying amount of the asset and its fair value.

In accordance with ASC 360-10, management reviews

operating lease assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset

may not be recoverable based on estimated future undiscounted cash flows.

If so indicated, an impairment loss would be recognized

for the difference between the carrying amount of the asset and its fair value.

Recent Accounting Standards:

In June 2016, the FASB issued

ASU 2016-13 “Financial Instruments –

In June 2016, the FASB issued ASU No.

2016-13, “Financial

Instruments –

Credit Losses,”

to improve information on credit losses for financial assets

and net investment in leases that are not accounted for at fair value through net income.

The ASU replaces the current incurred

loss impairment methodology with a methodology that reflects expected credit losses.

The Company plans to adopt this ASU in the

first quarter of 2020.

The Company does not expect the adoption of this ASU will have a material impact on its consolidated financial

In August 2018, the FASB issued

ASU 2018-13, “Changes to Disclosure Requirements for Fair Value Measurements,”

which will improve the effectiveness

of disclosure requirements for recurring and nonrecurring fair value measurements.

The standard removes, modifies, and adds certain

disclosure requirements and is effective for the Company beginning on January 1, 2020.

The Company does not expect that this standard

will have a material effect on the Company’s consolidated financial statements.

In November 2018, the FASB issued

ASU 2018-18 –

“Collaborative Arrangements (Topic 808),”

which clarifies the interaction between Topic 808 and

Topic 606, Revenue from Contracts with Customers.

to improve information on credit losses for financial assets and net investment in leases

that are not accounted for at fair value through net income.

2016-13 replaces the current incurred loss impairment methodology

with a methodology that reflects expected credit losses.

This guidance is effective for the Company beginning on January 1, 2023,

with early adoption permitted.

The Company does not expect that the adoption of this standard will have a significant impact on

its consolidated financial statements and related disclosures.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(USD in thousands, except share and

per share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Recent Accounting Standards:

In August 2018, the FASB issued ASU 2018-13, “Changes

to Disclosure Requirements for Fair Value Measurements,”

which will improve the effectiveness of disclosure requirements

for recurring and nonrecurring fair value measurements.

The standard removes, modifies, and adds certain disclosure requirements

and was effective for the Company beginning on January 1, 2020.

The adoption of ASU 2018-13 had no material impact on the Company’s

consolidated financial statements.

In November 2018, the FASB issued ASU 2018-18 ,“Collaborative

Arrangements (Topic 808),”

which clarifies the interaction between Topic 808 and Topic 606, “Revenue from Contracts

with Customers.”

The Company adopted this standard on January 1, 2020.

This standard is not expected

to have a material impact on the Company’s consolidated financial statements and related disclosures.

In December 2019, the FASB issued

The adoption of ASU 2018-18 had no material impact

on the Company’s consolidated financial statements.

In December 2019, the FASB issued ASU No.

“Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes (“ASU 2019-12”),

which is intended to simplify various aspects related to accounting for income taxes.

Simplifying the Accounting for Income Taxes”

(“ASU 2019-12”), which is

intended to simplify various aspects related to accounting for income taxes.

ASU 2019-12 removes certain exceptions

to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application.

guidance is effective for the Company beginning on January 1, 2021, with early adoption permitted.

The Company does not expect

that the adoption of this standard will have a significant impact on the consolidated financial statements and related disclosures.

NOTE 3 - OTHER

CURRENT ASSETS

guidance was effective for the Company beginning on January 1, 2021, with early adoption permitted.

The adoption of ASU 2019-12

had no material impact on the Company’s consolidated financial statements.

SHORT-TERM DEPOSITS

Short-term deposits represent time deposits placed

with banks with original maturities of greater than three months but less than one year.

Interest earned is recorded as finance

income in the consolidated statements of operations during the years for which the Company held short-term deposits.

As of December 31, 2020, the Company had deposits

at Leumi Bank (Israel) and BHI USA that bore fixed annual interest between 0.51% and 1.58%.

As of December 31, 2019, the Company

has a deposit dominated in USD at BHI USA that bears fixed annual interest of 2.1%.

OTHER CURRENT ASSETS

As of December 31,

USD In thousands

Government institutions

1 unchanged sentence

Other prepaid expenses

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

Lease incentive

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 - PROPERTY AND EQUIPMENT, NET

(USD in thousands, except share and

per share data)

PROPERTY AND EQUIPMENT, NET

As of December 31,

USD In thousands

Computers and software

7 unchanged sentences

Leasehold improvements

NOTE 5 - ACQUISITION OF SUBSIDIARY

19, 2017, BiomX Israel signed a share purchase agreement with the shareholders of RondinX Ltd.

In accordance with the share

purchase agreement, BiomX Israel acquired 100% control and ownership of RondinX Ltd.

for consideration valued at US$4.5

The consideration included the issuance of 250,023 Preferred A Shares, the issuance of warrants to purchase an

aggregate of 4,380 Series A-1 preferred shares, and additional contingent consideration.

The contingent consideration is

based on the attainment of future clinical, developmental, regulatory, commercial and strategic milestones relating to

product candidates for treatment of primary sclerosing cholangitis or entry into qualifying collaboration agreements with

certain third parties and may require the Company to issue 567,729 ordinary shares upon the attainment of certain milestones,

as well as make future cash payments and/or issue additional shares of the most senior class of the Company’s shares

authorized or outstanding as of the time the payment is due, or a combination of both of up to $32 million of the Company

within ten years from the closing of the agreement and/or the entering of agreements with certain third parties or their

affiliates that include a qualifying up-front fee and is entered into within three years from the closing of the agreement.

The Company has the discretion of determining whether milestone payments will be made in cash or by issuance of shares.

completed the RondinX Ltd.

acquisition on November 27, 2017.

The contingent

consideration is accounted for at fair value (level 3).

There were no changes in the fair value hierarchy levelling during the

years ended December 31, 2019 and December 31, 2018.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

ACQUISITION OF SUBSIDIARY

In November, 2017, BiomX Israel signed a share purchase

agreement with the shareholders of RondinX Ltd.

In accordance with the share purchase agreement, BiomX Israel acquired 100% control

and ownership of RondinX Ltd.

for consideration valued at $4,500.

The consideration included the issuance of 250,023 Preferred

A Shares, the issuance of warrants to purchase an aggregate of 4,380 Series A-1 preferred shares, and additional contingent consideration.

The contingent consideration is based on the attainment of future clinical, developmental, regulatory, commercial and strategic

milestones relating to product candidates for treatment of primary sclerosing cholangitis or entry into qualifying collaboration

agreements with certain third parties and may require the Company to issue 567,729 shares of Common Stock upon the attainment of

certain milestones, as well as make future cash payments and/or issue additional shares of the most senior class of the Company’s

shares of Common Stock authorized or outstanding as of the time the payment is due, or a combination of both of up to $32,000 of

the Company within ten years from the closing of the agreement and/or the entering of agreements with certain third parties or

their affiliates that include a qualifying up-front fee and is entered into within three years from the closing of the agreement.

The Company has the discretion of determining whether milestone payments will be made in cash or by issuance of shares of Common

The contingent consideration is accounted for at

fair value (level 3).

There were no changes in the fair value hierarchy levelling during the years ended December 31, 2020 and

December 31, 2019.

The consolidated financial statements as of December

31, 2020 and 2019 include a liability with respect to this agreement in the amount of $83 and $260, respectively.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5 - ACQUISITION OF SUBSIDIARY (Cont.)

The change in

the fair value of the contingent consideration as of December 31, 2019 and 2018 was as follows (USD in thousands):

consideration

As of December 31, 2018

Revaluation of contingent consideration

As of December 31, 2019

consideration

As of December 31, 2017

Revaluation of contingent consideration

(USD in thousands, except share and

per share data)

IN-PROCESS RESEARCH AND DEVELOPMENT

Intangible assets acquired in the RondinX Ltd.

(see Note 6) were determined to be in-process research and development (“R&D”).

In accordance with ASC 350-30-35-17A,

R&D assets acquired in a business combination are considered an indefinite-lived intangible asset until completion or abandonment

of the associated R&D efforts.

On January 1, 2020, the in-process R&D efforts were completed.

The Company had determined

the useful life of the R&D assets for three years and began amortizing these assets accordingly in the financial statements.

Amortization expenses recorded in the consolidated statements of operations were $1,518 for the year ended December 31, 2020.

Based on management’s analysis, there was no impairment for the year ended December 31, 2020.

In May 2017, BiomX Israel entered into a lease agreement

for office space in Ness Ziona, Israel.

The agreement is for five years beginning on June 1, 2017 with an option to extend for

an additional five years.

Monthly lease payments under the agreement are approximately $18.

As a part of the agreement, the Company

provided a bank guarantee to the landlord in the amount of approximately $95 representing four monthly lease payments.

As of December

NOTE 6 - IN-PROCESS RESEARCH AND DEVELOPMENT

assets acquired in the RondinX Ltd.

acquisition (see Note 5) were determined to be in-process R&D.

In accordance with ASC

350-30-35-17A, R&D assets acquired in a business combination are considered an indefinite-lived intangible asset until

completion or abandonment of the associated R&D efforts.

Once the R&D efforts are complete, the Company will

determine the useful life of the R&D assets and will amortize these assets accordingly in the financial statements.

December 31, 2019, the in-process R&D efforts had not yet been completed nor abandoned.

Based on management’s

analysis, there were no impairment indicators present as of December 31, 2019 and 2018.

NOTE 7 - LEASES

In May 2017, BiomX Israel entered

into a lease agreement for office space in Ness Ziona, Israel.

The agreement is for five years beginning on June 1, 2017 with

an option to extend for an additional five years.

Monthly lease payments under the agreement are approximately $17 thousand.

a part of the agreement, the Company provided a bank guarantee to the property owner in the amount of approximately $95 thousand

representing four monthly lease payments.

Lease expenses recorded in the consolidated statements of comprehensive loss were $201

thousand and $198 thousand for the years ended December 31, 2019, and 2018, respectively.

In September 2019, BiomX Israel

entered into an additional lease agreement for office space in Ness Ziona, Israel.

The agreement is for five years beginning on

September 8, 2019 with an option to extend for an additional three years.

The option was not accounted for as part of the lease,

given its low probability of being exercised.

Monthly lease payments under the agreement are approximately $10 thousand.

of the agreement, the Company provided a bank guarantee to in the amount of approximately $59 thousand representing four monthly

lease payments.

Lease expenses recorded in the consolidated statements of comprehensive loss were $18 thousand for the year ended

December 31, 2019.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

31, 2020, the bank guarantee expired and was not renewed.

Lease expenses recorded in the consolidated statements of operations

were $217 and $201 for the years ended December 31, 2020 and 2019, respectively.

In September 2019, BiomX Israel entered into an additional

lease agreement for office space in Ness Ziona, Israel.

The agreement is for five years beginning on September 8, 2019 with an

option to extend for an additional three years.

The option was not accounted for as part of the lease, given its low probability

of being exercised.

Monthly lease payments under the agreement are approximately $12.

As a part of the agreement, the Company provided

a bank guarantee to the landlord in the amount of approximately $63 representing four monthly lease and related payments.

expenses recorded in the consolidated statements of operations were $141 and $18 for the years ended December 31, 2020, and 2019,

respectively.

In September 2020, BiomX Israel entered into a third

lease agreement for office space in Ness Ziona, Israel for five years beginning on September 1, 2020, with an option to extend

for an additional period until November 30, 2030.

This agreement supersedes the abovementioned May 2017 and September 2019 lease

agreements and sets the prior lease agreements’

end date to March 31, 2021.

Monthly lease payments under the new lease agreement

are approximately $50.

As part of the agreement, BiomX Israel is exempt from monthly payments under the new agreement until January

In addition, the lessor will reimburse BiomX Israel for costs incurred for leasehold improvements by a pre-defined amount.

BiomX Israel will pay back the reimbursed amount with interest during the entire contract term.

As a result, the Company recognized

a lease incentive asset in an amount of $1,030 that is deducted from the operating lease right-of-use asset.

undertook to obtain a bank guarantee in favor of the landlord in the amount of approximately $208, representing four monthly lease

and related payments.

Lease expenses recorded in the consolidated statements of operations were $45 for the year ended December

On October 1, 2020, the Company entered into a lease

agreement for office space in Branford, Connecticut, U.S., for 25 months beginning on October 5, 2020.

Monthly lease payments under

the agreement are approximately $4.

As part of the agreement, the Company is required to deposit $8 as a security, representing

two monthly lease and related payments.

Lease expenses recorded in the consolidated statements of operations were $13 for the year

ended December 31, 2020.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 - LEASES (Cont.)

Supplemental cash flow information

related to operating leases was as follows (USD in thousands):

Cash payments for operating leases accounted under ASU 2016-02

As of December 31, 2019, the

Company’s operating leases had a weighted average remaining lease term of 4 years and a weighted average discount rate of

The maturity analysis of operating leases as of December 31, 2019 were as follows (USD in thousands):

(USD in thousands, except share and per share data)

LEASES (Cont.)

Supplemental cash flow information related to operating

leases was as follows:

Cash payments for operating leases

As of December 31, 2020, the Company’s operating

leases had a weighted average remaining lease term of 9.9 years and a weighted average discount rate of 6%.

The maturity analysis

of operating leases as of December 31, 2020 were as follows:

Total operating lease payments

1 unchanged sentence

Total operating lease liability balance

NOTE 8 - OTHER ACCOUNT PAYABLES

As of December 31,

USD In thousands

OTHER ACCOUNT PAYABLES

Employees and related institutions

2 unchanged sentences

Deferred income

NOTE 9 - BALANCES AND TRANSACTION WITH RELATED PARTIES

BALANCES AND TRANSACTION WITH RELATED PARTIES

Balances with related parties

As of December 31,

USD In thousands

Additional paid in capital (treasury stock) (See 1 below)

Related party receivable (payable) See 2 below

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

Related party receivable (See 2 below)

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 - BALANCES AND TRANSACTION WITH RELATED PARTIES (Cont.)

(USD in thousands, except share and per share data)

BALANCES AND TRANSACTION WITH RELATED PARTIES

Transactions with related parties

R&D expenses (See 2 below)

General and administration expenses (See 3 below)

BiomX Israel committed to enter into loan agreements with certain shareholders who were subject to taxation in Israel, in connection with the Recapitalization Transaction.

The loans are for a period of up to two years, are non-recourse and are secured by Company shares issued to them that have a value that equals three times the loan amount.

If any of such shareholders defaults on such loan, the Company will have the right to forfeit or sell such number of shares as have a value equal to the amount of the loan (plus interest accrued thereon) not timely repaid, based on their market price at the time of such forfeiture or sale.

As of December 31, 2019, one loan was granted in the amount of $19 thousand.

The aggregate amount of the remaining potential commitment is $89 thousand.

Research and development expenses (See 2 below)

BiomX Israel entered into loan agreements with

certain shareholders who were subject to taxation in Israel in connection with the Recapitalization Transaction.

are for a period of up to two years from the time of the grant, are non-recourse, and are secured by shares of Common Stock

issued to them with a value that equals three times the loan amount at the time of the grant.

If any of such shareholders

defaults on such loan, the Company will have the right to forfeit or sell such number of shares with a value equal to the

amount of the loan not timely repaid (plus interest accrued thereon), based on their market price at the time of such forfeiture

As of December 31, 2020, one loan was granted in the amount of $19, and the aggregate amount of the remaining potential

commitment as of December 31, 2020 is $89.

All other shareholders waived their right to the loans.

The numbers of Common Stock in respect of which the $19 loan was granted was 5,700.

The granting of the loan and the restrictions imposed on the relating Common Stock until repayment of the loan were accounted as an acquisition of treasury stock by the Company at an amount equal to the loan amount.

On October 31, 2018, BiomX Israel entered into a research collaboration agreement with Janssen Research & Development, LLC (“Janssen”), an affiliate of shareholder Johnson & Johnson Development Corporation, for a collaboration on biomarker discovery for inflammatory bowel disease (“IBD”).

Under the agreement, BiomX Israel is eligible to receive fees totaling $167 thousand in instalments of $50 thousand within 60 days of signing of the agreement, $17 thousand upon completion of data processing, and two instalments of $50 thousand each, upon delivery of Signature Phase I of the Final Study Report (both terms defined within the agreement).

This agreement ended in 2020, 30 days after the parties completed the research program and BiomX Israel provided Janssen with a final study report.

As of December 31, 2019, consideration of $117 thousand had been received.

The remaining $50 thousand consideration was received in January 2020.

In June 2015, an incubator company formation and financing agreement (the “Incubator Agreement”) was signed between BiomX Israel and other investors.

According to the Incubator Agreement, the role of the Incubator (as defined within the Incubator Agreement) was to provide BiomX Israel with offices, labs, administrative, finance, legal and other services.

In return for these services, the Incubator was entitled to receive fees at amount equal to 20% of BiomX Israel’s payroll expenses.

Starting from July 2018, BiomX Israel no longer received these services from the Incubator.

The Company recorded total expenses of $28 thousand for the year ended December 31, 2018, with respect to this agreement.

BiomX Israel entered into indemnification agreement with the Incubator on December 13, 2017.

According to the agreement, the aggregate amount of the indemnification shall not exceed an aggregate of NIS 2,295 thousand (approximately $664 thousand).

In addition, the indemnification is limited only to matters in connection with the Company’s compliance with the IIA regulations and that such indemnification undertakings will not derogate from any other indemnification undertakings to which BiomX Israel is bound.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

The number of shares of

Common Stock in respect of which the $19 loan was granted was 5,700.

The granting of the loan and the restrictions imposed

on the related Common Stock until repayment of the loan were accounted as an acquisition of treasury stock by the Company

at an amount equal to the loan.

On October 31, 2018, BiomX Israel entered into

a research collaboration agreement with Janssen Research & Development, LLC (“Janssen”), an affiliate

of shareholder Johnson & Johnson Development Corporation, for a collaboration on biomarker discovery for inflammatory

bowel disease (“IBD”).

Under the agreement, BiomX Israel is eligible to receive fees totaling $167 in installments

of $50 within 60 days of signing of the agreement, $17 upon completion of data processing, and two installments of $50 each,

upon delivery of Signature Phase I of the Final Study Report (both terms defined within the agreement).

This agreement ended

in 2020, 30 days after the parties completed the research program and BiomX Israel provided Janssen with a final study report.

As of December 31, 2019, consideration of $117 had been received.

The remaining $50 consideration was received in January

COMMITMENTS AND CONTINGENT LIABILITIES

During 2015, 2016 and 2017, BiomX Israel submitted

three requests to the IIA for R&D projects for the technological incubators program.

The approved budget per year was

NIS 2,700 (approximately $781) per request.

According to the IIA directives, the IIA funded 85% of the approved budget and

the rest of the budget was funded by certain shareholders.

In April 2019, the IIA approved an application for

a total budget of NIS 4,221 (approximately $1,185).

IIA funded 30% of the approved budget.

The program was for the period beginning

from July 2018 through June 2019.

As of December 31, 2020, BiomX Israel has received all funds with respect to this program.

In December 2019, the IIA approved an application for

a total budget of NIS 10,794 (approximately $3,123).

IIA funded 30% of the approved budget.

The program is for the period beginning

from July 2019 through December 2019.

As of December 31, 2020, BiomX Israel has submitted the final report to the IIA for this

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 - COMMITMENTS AND CONTINGENT LIABILITIES

During 2015, 2016 and 2017, BiomX Israel submitted three requests to the IIA for a R&D project for the technological incubators program.

The approved budget per year was NIS 2.7 million (approximately $781 thousand) per request.

According to the IIA directives, the IIA funded 85% of the approved budget and the rest of the budget was funded by certain shareholders.

According to the agreement with

the IIA, BiomX Israel will pay royalties of 3% to 3.5% of future sales up to an amount equal to the accumulated grant received

including annual interest of LIBOR linked to the dollar.

BiomX Israel may be required to pay additional royalties upon the occurrence

of certain events as determined by the IIA, that are within the control of BiomX Israel.

No such events have occurred or were probable

of occurrence as of the balance sheet date with respect to these royalties.

Repayment of the grant is contingent upon the successful

completion of the BiomX Israel’s R&D programs and generating sales.

BiomX Israel has no obligation to repay these grants

if the R&D program fails, is unsuccessful or aborted or if no sales are generated.

The Company had not yet generated sales

as of December 31, 2019, therefore, no liability was recorded in these consolidated financial statements.

Total research and development

income recorded in the consolidated statements of comprehensive loss was $299 thousand and $646 thousand for the years ended December

31, 2019 and 2018, respectively.

As of December 31, 2019, BiomX Israel had a contingent obligation to the IIA in the amount of

approximately $2.3 million including annual interest of LIBOR linked to the dollar.

In December 2019, the IIA approved

a new application for a total budget of NIS 10.8 million (approximately $3.1 million).

IIA will fund 30% of the approved budget.

The program is for the period beginning from July 2019 through December 2019.

BiomX Israel has not yet submitted the final report

to the IIA for this program.

As of December 31, 2019, no income was recorded with respect to this application.

During December 2019 BiomX Israel

submitted three additional applications to the IIA, for a total budget of NIS 41.1 million (approximately $11.9 million).

applications are being reviewed be the IIA.

In June 2015, BiomX Israel entered into a Research and License Agreement (the “2015 License Agreement”) as amended with Yeda Research and Development Company Limited (“Yeda”), according to which Yeda undertakes to conduct research.

The research includes proof-of-concept studies testing in-vivo phage eradication against a model bacteria in germ free mice, development of an IBD model in animals under germ-free conditions and establishing in-vivo method for measuring immune induction capability (Th1) of bacteria, followed by testing several candidate IBD inducing bacterial strains.

During the research period, as defined in the 2015 License Agreement and subject to the terms and conditions specified in the 2015 License Agreement, the Company contributed an aggregate of approximately $1.8 million to the research budget agreed upon in the 2015 License Agreement.

In addition, Yeda granted the Company with an exclusive worldwide license for the development, production and sale of the products (the “License”), as defined in the 2015 License Agreement and subject to the terms and conditions specified in the 2015 License Agreement.

In return for the License, the Company will pay Yeda annual license fees of approximately $10 thousand and royalties on revenues as defined in the 2015 License Agreement.

As the Company has not yet generated revenue from operations, no provision was included in the financial statements with respect to the 2015 License Agreement as of December 31, 2019 and 2018.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

(USD in thousands, except share and per share data)

COMMITMENTS AND CONTINGENT LIABILITIES (Cont.)

During April 2020, the IIA approved a new application

for a total budget of NIS 15,562 (approximately $4,287).

The IIA committed to funding 30% of the approved budget.

was for the period beginning January 2020 through December 2020.

As of December 31, 2020, the Company received NIS 1,634 (approximately

$450) from the IIA with respect to this program.

BiomX Israel has not yet submitted the final report to the IIA for this program.

Refer to note 18C for more information regarding

approved applications in 2021.

According to the agreement with the IIA, BiomX Israel

will pay royalties of 3% to 3.5% of future sales up to an amount equal to the accumulated grant received including annual interest

of LIBOR linked to the dollar.

BiomX Israel may be required to pay additional royalties upon the occurrence of certain events

as determined by the IIA, that are within the control of BiomX Israel.

No such events have occurred or were probable of occurrence

as of the balance sheet date with respect to these royalties.

Repayment of the grant is contingent upon the successful completion

of the BiomX Israel’s R&D programs and generating sales.

BiomX Israel has no obligation to repay these grants if the

R&D program fails, is unsuccessful or aborted or if no sales are generated.

The Company had not yet generated sales as of

December 31, 2020, therefore, no liability was recorded in these consolidated financial statements.

Total research and development income recorded in the

consolidated statements of operations was $518 and $299 for the years ended December 31, 2020 and 2019, respectively.

As of December 31, 2020, BiomX Israel had a contingent

obligation to the IIA in the amount of approximately $2,300 including annual interest of LIBOR linked to the dollar.

June 2015, BiomX Israel entered into a Research

and License Agreement (the “2015 License Agreement”) as amended with Yeda Research and Development Company Limited

(“Yeda”), according to which Yeda undertakes to procure the performance of certain research, including proof-of-concept

studies testing in-vivo phage eradication against a model bacteria in germ free mice, development of an IBD model in animals

under germ-free conditions and establishing an in-vivo method for measuring immune induction capability (Th1) of bacteria,

followed by testing several candidate IBD inducing bacterial strains during the research period, as defined in the 2015 License

Agreement and subject to the terms and conditions specified in the 2015 License Agreement.

BiomX Israel contributed an aggregate

of approximately $1,800 to the research budget agreed upon in the 2015 License Agreement.

In addition, Yeda granted BiomX

Israel an exclusive worldwide license for the development, production and sale of the products, as defined and subject to

the terms and conditions specified in the 2015 License Agreement.

In return, BiomX Israel is obligated to pay Yeda annual

license fees of approximately $10 and royalties on revenues as defined in the 2015 License Agreement.

In addition, in the

event of certain mergers and acquisitions by the Company, Yeda will be entitled to an amount equivalent to 1% of the consideration

received under such transaction (the “Exit Fee”), as adjusted per the terms of the 2015 License Agreement.

July 2019, the Company and Yeda amended the 2015 License Agreement and the 2017 License Agreement (as defined below) with

Yeda (the “Yeda Amendment”).

See Note 11G regarding the Yeda Amendment.

As the Company has not yet generated revenue

from operations, no provision was included in the consolidated financial statements as of December 31, 2020 and 2019 with

respect to the 2015 License Agreement.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 - COMMITMENTS AND CONTINGENT LIABILITIES (Cont.)

In May 2017, BiomX Israel signed an additional agreement with Yeda (the “2017 License Agreement”) according to which, Yeda provided a license to BiomX Israel.

As consideration for the license, the Company paid $10 thousand for the term of the 2017 License Agreement, unless earlier terminated by either party and granted Yeda 591,382 warrants to purchase Ordinary Shares of the Company at $0.0001 nominal value.

Refer to Note 11 below for the terms of the warrants granted.

In the event of certain mergers and acquisitions by BiomX Israel, Yeda will be entitled to an amount equivalent to 1% of the consideration received under such transaction (the “exit fee”), as adjusted per the terms of the agreement.

In addition, the 2017 License Agreement includes additional consideration contingent upon future sales or sublicensing revenue.

As the Company has not yet generated revenue from operations, no provision was included in the financial statements with respect to the 2017 License Agreement as of December 31, 2019 and 2018.

In July 2019, the Company, Yeda and BiomX

Israel amended the 2015 License Agreement and the 2017 License Agreement with Yeda (the “Amendment”).

the Amendment, following the closing of the Recapitalization Transaction, the provisions of the 2015 License Agreement and the

2017 License Agreement related to the exit fee were amended so that, in the event of any merger or acquisition involving BiomX,

the Company is obliged to pay Yeda a one-time payment as described in the Amendment which will not exceed 1% of the consideration

received under such transaction.

successor in interest to RondinX Ltd., BiomX Israel is a party to a license agreement dated March 20, 2016 with Yeda, pursuant

to which the Company has a worldwide exclusive license to Yeda’s know-how, information and patents related to the Company’s

meta-genomics target discovery platform.

As consideration for the license, the Company will pay license fees of $10 thousand

subject to the terms and conditions of the agreement.

Either party has the option to terminate the agreement at any time by

way of notice to the other party as outlined in the agreement.

In addition, the Company will pay a royalty in the low single

digits on revenue of products.

As the Company has not yet generated revenue from operations, no provision was recorded in

the financial statements as of December 31, 2019 and 2018 with respect to the agreement.

In April 2017, BiomX Israel signed an exclusive patent license agreement with the Massachusetts Institute of Technology (“MIT”) covering methods to synthetically engineer phage.

According to the agreement, BiomX Israel received an exclusive, royalty-bearing license to certain patents held by MIT.

In return, BiomX Israel paid an initial license fee of $25 thousand during the year ended 2017 and is required to pay certain license maintenance fees of up to $250 thousand in each subsequent year and following the commercial sale of licensed products.

BiomX Israel is also required to make payments to MIT upon the satisfaction of development and commercialization milestones totaling up to $2.4 million in aggregate, as well as royalty payments on future revenues.

The consolidated financial statements include a liability with respect to this agreement in the amount of $108 thousand as of December 31, 2019.

There was no liability recorded with respect to this agreement as of December 31, 2018.

In December 2017, BiomX Israel signed a patent license agreement with Keio University and JSR Corporation in Japan.

According to the agreement, BiomX Israel received an exclusive patent license to certain patent rights related to the BiomX Israel inflammatory bowel disease program.

In return, BiomX Israel will pay annual license fees of between $15 thousand to $25 thousand subject to the terms and conditions specified in the agreement.

Additionally, the Company is obligated to pay contingent consideration based upon the achievement of clinical and regulatory milestones up to an aggregate of $3.2 million and royalty payments based on future revenue.

In April 2019, BiomX Israel signed additional patent license

agreement with Keio University and JSR Corporation in Japan.

According to the agreement, BiomX Israel received an exclusive sublicense

by JSR to certain patent rights related to the Company’s Primary Sclerosing Cholangitis program.

In return, BiomX Israel

is required (i) to pay a license issue fee of $20 thousand and annual license fees ranging from $15 thousand to $25 thousand;

make additional payments based upon the achievement of clinical and regulatory milestones up to an aggregate of $3.2 million (“milestone

payments”);

and (iii) make tiered royalty payments, in the low single digits based on future revenue.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

(USD in thousands, except share and per share data)

COMMITMENTS AND CONTINGENT LIABILITIES (Cont.)

In May 2017, BiomX Israel signed an additional

agreement with Yeda (the “2017 License Agreement”), according to which Yeda provided a license to the Company.

As consideration for the license, the Company is obligated to pay $10 over the term of the 2017 License Agreement, unless

earlier terminated by either party, and granted Yeda 591,382 warrants to purchase shares of Common Stock.

Refer to Note 12

below for the terms of the warrants granted.

In addition, the 2017 License Agreement includes additional consideration contingent

upon future sales or sublicensing revenue.

As the Company has not yet generated revenue from operations, no provision was

included in the financial statements with respect to the 2017 License Agreement as of December 31, 2020 and 2019.

In July 2019, the Company and Yeda amended the 2015

License Agreement and the 2017 License Agreement with Yeda.

See Note 11G regarding the Yeda Amendment.

In April 2017, BiomX Israel signed an exclusive patent

license agreement (the “2017 Patent License Agreement”) with the Massachusetts Institute of Technology (“MIT”)

covering methods to synthetically engineer phage.

According to the agreement, BiomX Israel received an exclusive, royalty-bearing

license to certain patents held by MIT.

In return, BiomX Israel paid an initial license fee of $25 during the year ended

2017 and is required to pay certain license maintenance fees of up to $250 in each subsequent year and following the commercial

sale of licensed products.

BiomX Israel is also required to make payments to MIT upon the satisfaction of development

and commercialization milestones totaling up to $2,350 in aggregate, as well as royalty payments on future revenues.

consolidated financial statements as of December 31, 2020 and 2019 include a liability with respect to this agreement

in the amount of $240 and $108, respectively.

In October 2020, the Company and MIT amended the 2017

Patent License Agreement (the “MIT Amendment”).

See Note 11I regarding the MIT Amendment.

As successor in interest to RondinX Ltd., BiomX

Israel is a party to a license agreement dated March 20, 2016 with Yeda, pursuant to which the Company has a worldwide exclusive

license to Yeda’s know-how, information and patents related to the Company’s meta-genomics target discovery platform.

As consideration for the license, the Company is obligated to pay annual license fees of $10 subject to the terms and conditions

of the agreement.

Either party has the option to terminate the agreement at any time by way of notice to the other party as

outlined in the agreement.

In addition, the Company is obligated to pay a royalty in the low single digits on revenue of products.

The consolidated financial statements as of December 31, 2020 and 2019 include a liability with respect to this agreement

in the amount of $83 and $260, respectively.

Refer to Note 6 regarding contingent liability with respect to the RondinX Ltd.

In December 2017, BiomX Israel signed a patent

license agreement with Keio University and JSR Corporation in Japan.

According to the agreement, BiomX Israel received an

exclusive patent license to certain patent rights related to the Company’s IBD program.

In return, the Company will

pay an annual license fee of between $15 and $25 subject to the terms and conditions specified in the agreement.

Additionally,

the Company is obligated to make additional payments based upon the achievement of clinical and regulatory milestones up to

an aggregate of $3,210 and royalty payments based on future revenue.

As the Company has not yet generated revenue from operations

and the achievement of certain milestones is not probable, no provision was included in the consolidated financial statements

as of December 31, 2020 and 2019 with respect to the agreement.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 - COMMITMENTS AND CONTINGENT LIABILITIES (Cont.)

The consolidated financial statements

include liabilities with respect to this agreement in the amount of $217 thousand as of December 31, 2019.

The amount was determined

using the expected cash flow approach.

There was no liability recorded with respect to this agreement as of December 31, 2018.

Refer to Note 7 for information regarding the Company’s lease commitments.

Refer to Note 9B(1) for information regarding the Company’s commitment to certain shareholders for taxes incurred in Israel as a result of the Recapitalization Transaction.

Refer to Note 5 regarding contingent liability with respect to RondinX Ltd.

NOTE 11 - SHAREHOLDERS EQUITY

(USD in thousands, except share and per share data)

COMMITMENTS AND CONTINGENT LIABILITIES (Cont.)

In April 2019, BiomX Israel signed an additional patent

license agreement with Keio University and JSR Corporation in Japan.

According to the agreement, BiomX Israel received an exclusive

sublicense by JSR to certain patent rights related to the Company’s Primary Sclerosing Cholangitis program.

In return, the

Company is required (i) to pay a license issue fee of $20 and annual license fees ranging from $15 to $25 (ii) make additional

payments based upon the achievement of clinical and regulatory milestones up to an aggregate of $32,10 and (iii) make tiered royalty

payments, in the low single digits based on future revenue.

The consolidated financial statements include liabilities with respect

to this agreement in the amount of $378 and $217 as of December 31, 2020 and 2019, respectively.

In July 2019, the Company and Yeda amended the 2015

License Agreement and the 2017 License Agreement with Yeda.

Pursuant to the Yeda Amendment, following the closing of the

Recapitalization Transaction, the provisions of the Yeda license agreements related to the Exit Fee were amended so that

the Company is obligated to pay Yeda a one-time payment as described in the Yeda Amendment which will not exceed 1% of

the consideration received in the event of any merger or acquisition involving the Company instead of the Exit Fee, with

respect to each license agreement.

The 2017 license agreement was terminated in 2020.

On September 1, 2020 (“Effective Date”),

BiomX Israel entered into a research collaboration agreement with Boehringer Ingelheim International GmbH (“BI”)

for a collaboration on biomarker discovery for IBD.

Under the agreement, BiomX Israel is eligible to receive fees totaling

$439 in installments of $50 within 60 days of the Effective Date, $100 upon receipt of the BI materials, $150 upon the

completion of data processing and $139 upon delivery of the Final Report of observations and Results of the Project (as

such terms are defined within the agreement).

Unless terminated earlier, this agreement will remain in effect, until one

year after the Effective Date or completion of the Project Plan (as defined in the agreement) and submission and approval

of the Final Report.

As of December 31, 2020, consideration of $150 had been received.

In October 2020, the Company and MIT amended

the 2017 Patent License Agreement.

Pursuant to the MIT Amendment, BiomX Israel will continue to receive an exclusive, royalty-bearing

license to certain patents held by MIT.

In return, BiomX Israel is required to pay certain license maintenance fees of up

to $250 in each subsequent year and following the commercial sale of licensed products.

BiomX Israel is also required to make

payments to MIT upon the satisfaction of development and commercialization milestones totaling up to $4,700 in aggregate,

as well as royalty payments on future revenues.

Refer to Note 8 for information regarding the

Company’s lease commitments.

Refer to Note 10B(1) for information regarding

the Company’s commitment to certain shareholders for taxes incurred in Israel as a result of the Recapitalization Transaction.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(USD in thousands, except share and per share data)

STOCKHOLDERS EQUITY

Share Capital:

Common Stock:

The Company is authorized to

issue 60,000,000 shares of Common Stock with a par value of $0.0001 per share.

Holders of the Company’s Common Stock are

entitled to one vote for each share.

As of December 31, 2019, the Company had 22,862,835 issued and outstanding Common Stock shares.

The Company is authorized to issue 60,000,000 shares

of Common Stock.

Holders of the Company’s Common Stock are entitled to one vote for each share.

As of December 31, 2020,

the Company had 23,270,337 issued shares and 23,264,637 outstanding shares of Common Stock.

Initial Public Offering:

On December 18, 2018, the

Company consummated its initial public offering (“IPO”) of 7,000,000 units (“Public Units”).

Units sold in the IPO were sold at an offering price of $10.00 per Public Unit, generating total gross proceeds of $70,000,000.

The Public Units each consists of one share of Common Stock and one warrant to purchase one-half of a share of Common Stock (“Public

Warrant”), with every two Public Warrants entitling the holder to purchase one share of Common Stock for $11.50 per full

Following the Recapitalization

Transaction, the Company retained the $60.1 million balance held in a trust account, after redemptions of IPO shares held by

certain shareholders.

Simultaneous with the consummation

of the IPO, the Company consummated the private placement of an aggregate of 2,900,000 warrants (“Private Placement Warrants”).

On December 18, 2018, the Company consummated its

initial public offering (“IPO”) of 7,000,000 units (“Public Units”).

The Public Units sold in the IPO

were sold at an offering price of $10.00 per Public Unit, generating total gross proceeds of $70,000.

The Public Units each consist

of one share of Common Stock and one warrant to purchase one-half of a share of Common Stock (“Public Warrant”), with

every two Public Warrants entitling the holder to purchase one share of Common Stock for $11.50 per full share.

Following the Recapitalization Transaction, the

Company retained approximately $60,100 balance held in a trust account, after redemptions of IPO shares held by certain shareholders.

Simultaneous with the consummation of the IPO, the

Company consummated the private placement of an aggregate of 2,900,000 warrants (“Private Placement Warrants”).

Issuance of Share Capital:

During 2018 BiomX Ltd issued

an aggregate amount of 3,028,990 Preferred A Shares (pre-merger) for a total consideration of $13,000 thousand, in connection

with various share purchase agreement with investors.

In November 2018, the Company

entered into a share purchase agreement (the “November 2018 SPA”) with new and existing investors (the “November

2018 Investors”).

In accordance with the November 2018 SPA, the Company issued to the November 2018 Investors a total of

5,478,985 Preferred B Shares at $0.0001 nominal value (the “Preferred B Shares”) for total consideration of $31,955

thousand as follows:

On November 28, 2018 and on December 11, 2018, the Company issued to the November 2018 Investors 4,964,607 and 205,750 Preferred B Shares, respectively, for total consideration of $30,155 thousand in accordance with the November 2018 SPA .

On January 8, 2019, the Company issued to the November 2018 Investors an additional 308,628 Preferred B Shares for total consideration of $1,800 thousand in accordance with the November 2018 SPA.

Share Exchange:

As detailed in Note 1, as part

of the Recapitalization Transaction on October 28, 2019, the Company issued 15,069,058 Common Shares in exchange for approximately

65% of the issued and outstanding ordinary shares and all the preferred shares of BiomX Israel.

The number of shares prior to the

Recapitalization Transaction have been retroactively adjusted based on the equivalent number of shares received by the accounting

acquirer in the Recapitalization Transaction.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

During 2018 BiomX Ltd.

issued an aggregate amount

of 3,028,990 Preferred A Shares (pre-merger) for a total consideration of $13,000, in connection with various share purchase agreement

with investors.

In November 2018, the Company entered into a share

purchase agreement (the “November 2018 SPA”) with new and existing investors (the “November 2018 Investors”).

In accordance with the November 2018 SPA, the Company issued to the November 2018 Investors a total of 5,478,985 Preferred B Shares

at $0.0001 nominal value (the “Preferred B Shares”) for total consideration of $31,955 as follows:

On November 28, 2018 and on December 11, 2018,

the Company issued to the November 2018 Investors 4,964,607 and 205,750 Preferred B Shares, respectively, for total consideration

of $30,155 in accordance with the November 2018 SPA.

On January 8, 2019, the Company issued to the

November 2018 Investors an additional 308,628 Preferred B Shares for total consideration of $1,800 in accordance with the

November 2018 SPA.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 - SHAREHOLDERS EQUITY (Cont.)

(USD in thousands, except share and per share data)

STOCKHOLDERS EQUITY (Cont.)

Share Capital:

Share Exchange:

In addition, the Company also

agreed to issue the following number of additional shares of Common Stock, in the aggregate, to shareholders on a pro rata basis,

subject to the Company’s achievement of the conditions specified below following the recapitalization transaction (all with

respect to the Company’s common shares traded on the NYSE):

2,000,000 additional shares of the Company’s Common

Stock if the daily volume weighted average price of the Company’s Common Stock in any 20 trading days within a 30-trading

day period prior to January 1, 2022 is greater than or equal to $16.50 per share.

2,000,000 additional shares of the Company’s Common

Stock if the daily volume weighted average price of the Company’s Common Stock in any 20 trading days within a 30-trading

day period prior to January 1, 2024 is greater than or equal to $22.75 per share.

2,000,000 additional shares of the Company’s Common

Stock if the daily volume weighted average price of the Company’s Common Stock in any 20 trading days within a 30-trading

day period prior to January 1, 2026 is greater than or equal to $29.00 per share.

Stock Exchange:

As detailed in Note 1, as part of the Recapitalization

Transaction on October 28, 2019, the Company issued 15,069,058 shares of Common Stock in exchange for approximately 65% of the

issued and outstanding ordinary shares and all the preferred shares of BiomX Israel.

The number of shares prior to the Recapitalization

Transaction has been retroactively adjusted based on the equivalent number of shares received by the accounting acquirer in the

Recapitalization Transaction.

In addition, the Company also agreed to issue the

following number of additional shares of Common Stock, in the aggregate, to stockholders on a pro rata basis, subject to the Company’s

achievement of the conditions specified below following the recapitalization transaction (all with respect to the Company’s

Common Stock traded on the NYSE American):

2,000,000 additional shares of the Company’s

Common Stock if the daily volume weighted average price of the Company’s Common Stock in any 20 trading days within

a 30-trading day period prior to January 1, 2022 is greater than or equal to $16.50 per share.

2,000,000 additional shares of the Company’s

Common Stock if the daily volume weighted average price of the Company’s Common Stock in any 20 trading days within

a 30-trading day period prior to January 1, 2024 is greater than or equal to $22.75 per share.

2,000,000 additional shares of the Company’s

Common Stock if the daily volume weighted average price of the Company’s Common Stock in any 20 trading days within

a 30-trading day period prior to January 1, 2026 is greater than or equal to $29.00 per share.

At-the-market Sales Agreement:

In December 2020, pursuant to a registration statement

on Form S-3 declared effective by the Securities and Exchange Commission on December 11, 2020, the Company entered into an Open

Market Issuance Sales Agreement (“ATM Agreement”) with Jefferies LLC.

(“Jefferies”), which provides that,

upon the terms and subject to the conditions and limitations in the ATM Agreement, the Company may elect, from time to time, to

offer and sell shares of Common Stock having an aggregate offering price of up to $50,000 through Jefferies acting as sales agent.

During the year ended December 31, 2020, the Company sold 10,176 shares of Common Stock under the ATM Agreement, at an average

price of $6.07 per share, raising aggregate net proceeds of approximately $60, after deducting an aggregate commission of 3%.

The Company recorded issuance expenses of $158.

Preferred Stock:

The Company is authorized

to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share.

As of December 31, 2019, no preferred stock

has been issued.

Share-based compensation:

The Company is authorized to issue 1,000,000 shares

of preferred stock with a par value of $0.0001 per share with such designation, rights and preferences as may be determined from

time to time by the Company’s Board of Directors (the “Board”).

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(USD in thousands, except share and per share data)

STOCKHOLDERS EQUITY (Cont.)

Stock-based compensation:

Equity Incentive Plan:

In 2015, the board of directors

of BiomX Israel approved a plan (original option plan) for the allocation of options to employees, service providers, and officers

(the “2015 Plan”).

The options represented a right to purchase 1 Ordinary Share of the BiomX Israel in consideration

of the payment of an exercise price.

Also, the options were granted in accordance with the “capital gains route”

section 102 and section 3(i) of the Israeli Income Tax Ordinance and section 409A of the Israeli Internal Revenue Code.

The original option plan was

adjusted in 2019 following the Recapitalization Transaction on October 28, 2019.

Following the Recapitalization Transaction, each

outstanding option entitles its holder to purchase 1 Common Stock share of the Company.

As a result, the number of options and

exercise price per share were adjusted in a technical manner such that there was no change in the fair value of the awards under

the adjusted option plan.

The number of outstanding options and exercise prices in this Note have been restated to reflect the

adjusted option plan.

As of December 31, 2019, there

are no shares remaining for issuance under the original option plan.

The Company adopted a new incentive

plan in 2019 (the "2019 Plan") to grant 1,000 options, exercisable to Common Stock, par value $0.0001 per share.

December 31, 2019, no options were granted under the 2019 plan.

The aggregate number of shares

of Common Stock that may be delivered pursuant to the 2019 Plan will automatically increase on January 1 of each year, commencing

on January 1, 2020 and ending on (and including) January 1, 2029, in an amount equal to four percent (4%) of the total number of

Common Stock outstanding on December 31 of the preceding calendar year.

Notwithstanding the foregoing, the Board of Directors may

act prior to January 1 of a given year to provide that there will be no January 1 increase for such year or that the increase for

such year will be a lesser number of Common Stock than provided herein.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

In 2015, the Board of Directors of BiomX Israel approved

a plan for the allocation of options to employees, service providers, and officers (the “2015 Plan”).

The options represented

a right to purchase one Ordinary Share of the BiomX Israel in consideration of the payment of an exercise price.

Also, the options

were granted in accordance with the “capital gains route”

under section 102 and section 3(i) of the Israeli Income

Tax Ordinance and section 409A of the U.S.

Internal Revenue Code.

The 2015 plan was adjusted following the Recapitalization

Transaction on October 28, 2019 such that each outstanding option entitles its holder to purchase one share of Common Stock of

As a result, the number of options and exercise price per share were adjusted in a technical manner such that there

was no change in the fair value of the awards under the adjusted 2015 Plan.

The number of outstanding options and exercise prices

in this Note have been restated to reflect the adjusted 2015 Plan.

As of December 31, 2020, there are no shares of

Common Stock remaining for issuance under the 2015 Plan.

In 2019, the Company adopted a new incentive plan

(the “2019 Plan”) to grant 1,000 options, exercisable for Common Stock.

The aggregate number of shares of Common Stock that

may be delivered pursuant to the 2019 Plan will automatically increase on January 1 of each year, commencing on January 1, 2020

and ending on (and including) January 1, 2029, in an amount equal to four percent (4%) of the total number of shares of Common

Stock outstanding on December 31 of the preceding calendar year.

Notwithstanding the foregoing, the Board may act

prior to January 1 of a given year to provide that there will be no January 1 increase for such year or that the increase for

such year will be a lesser number of shares of Common Stock than provided herein.

As of December 31, 2020, there were 60,041 shares

of Common Stock remaining for issuance under the 2019 plan.

On January 1, 2021, the number of shares of Common Stock available

to grant under the 2019 Plan was increased by 930,813.

Stock Options:

During 2019, the Board approved the grant of 704,669

options to 22 employees and 79,630 options to two consultants, without consideration.

527,716 of the options granted are to the

executive officers of the Company.

These options were granted under the 2015 Plan.

During 2019, 74,581 of these options were exercised

to purchase shares of Common Stock at an average exercise price of $1.34 per share.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 - SHAREHOLDERS EQUITY (Cont.)

Share-based compensation:

(USD in thousands, except share and per share data)

STOCKHOLDERS EQUITY (Cont.)

Stock-based compensation:

Stock Options:

All options granted during 2018

and 2019 were made under the 2015 Plan.

During 2018, the Board

approved the grant of 785,775 non-tradable options without consideration to 27 employees and 199,481 non-tradable options

without consideration to 2 consultants.

876,504 options were granted at an exercise prices of between $1.97-$2.03 per share.

25% of the options vest and become exercisable on the first anniversary of the vesting commencement date.

Thereafter, the options vest and become exercisable in 12 equal quarterly instalments of 6.25% each.

options were granted at an exercise price of $1.69 per share and vest on variable vesting dates.

During 2018, 30,938 options

were exercised to purchase ordinary shares at an exercise price of $0.001 per share.

During 2019, the Board approved

the grant of 704,669 options without consideration to 22 employees and 79,630 options without consideration to 2 consultants.

of the options granted are to the executive officers of the Company.

During 2019, 74,581 options

were exercised to purchase ordinary shares at an exercise price of $1.34 per share.

Certain senior employees are

entitled to full acceleration of their unvested options upon the occurrence of cumulative two certain events.

The fair value of each option

was estimated as of the date of grant or reporting period using the Black-Scholes option-pricing model.

The fair value of options

was estimated at the date of grant using the following assumptions:

Underlying value of ordinary share ($)

Certain senior employees and directors are entitled

to full acceleration of their unvested options upon the occurrence of both a change in control of the Company and the end of their

engagement with the Company.

On March 25, 2020, the Board approved the grant

of 814,700 options without consideration to 65 employees, one consultant, four senior officers (one of whom is also a consultant),

and six directors under the 2019 Plan.

These options were granted at an exercise price of $6.21 per share with vesting periods

ranging from three to four years.

Directors and senior officers are entitled to full acceleration of their unvested options upon

the occurrence of both a change in control of the Company and the end of their engagement with the Company.

On May 5, 2020, the Board approved the grant of

79,000 options without consideration to four employees under the 2019 Plan.

These options were granted at an exercise price of

$5.59 per share with a vesting period of four years.

On October 2, 2020, the Board of Directors approved

the grant of 32,000 options without consideration to two directors under the 2019 Plan.

These options were granted at an exercise

price of $6.44 per share with a vesting period of four years.

Directors are entitled to full acceleration of their unvested options

upon the occurrence of both a change in control of the Company and the end of their engagement with the Company.

The fair value of each option was estimated as of

the date of grant or reporting period using the Black-Scholes option-pricing model using the following assumptions:

Underlying value of Common Stock ($)

Exercise price ($)

2 unchanged sentences

Risk-free interest rate (%)

The cost of the benefit embodied

in the options granted in 2019 and 2018 based on their fair value as at the grant date, is estimated to be $1,406 thousand and

$1,451 thousand, respectively.

These amounts will be recognized in statements of comprehensive loss over the vesting period.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

The cost of the benefit embodied in the options granted

in 2020 and 2019 based on their fair value as at the grant date, is estimated to be $3,752 and $1,395, respectively.

These amounts

will be recognized in statements of operations over the vesting period.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 - SHAREHOLDERS EQUITY (Cont.)

Share-based compensation:

(1) A summary of options granted to purchase the Company’s

Ordinary Shares under the Company’s share option plan is as follows:

For year ended December 31,

Outstanding at the beginning of year

Outstanding at the end of year

Vested at year end

(USD in thousands, except share and per share data)

STOCKHOLDERS EQUITY (Cont.)

Stock-based compensation:

Stock Options:

A summary of options granted to purchase the

Company’s Common Stock under the Company’s stock option plans are as follows:

For year ended

December 31, 2020

Outstanding at the beginning of period

Outstanding at the end of period

Vested at end of period

Weighted average remaining contractual life –

years as of December 31, 2020

For year ended December 31,

Outstanding at the beginning of year

Outstanding at the end of year

Vested at year end

For year ended

December 31, 2019

Outstanding at the beginning of period

Outstanding at the end of period

Vested at end of period

Weighted average remaining contractual life –

years as of December 31, 2019

(*) Less than $0.01.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 - SHAREHOLDERS EQUITY (Cont.)

Share-based compensation:

(2) The following table sets forth the total share-based payment

expenses resulting from options granted, included in the statements of operation:

USD In thousands

General and administrative

The Company recognized share-based

compensation expenses in connection with options granted to executive officers of the Company in the amount of $732 thousand and

$405 thousand for the years ended December 31, 2019 and 2018, respectively.

The total unrecognized compensation expense was $2,308 thousand

and $3,026 thousand as of December 31, 2019 and 2018, respectively.

These expenses will be recognized over a period of approximately

As of December 31, 2019,

and 2018, the Company had the following outstanding warrants to purchase Common Stock as follows:

(USD in thousands, except share and per share data)

STOCKHOLDERS EQUITY (Cont.)

Stock-based compensation:

As of December 31, 2020, and 2019, the Company

had the following outstanding warrants to purchase Common Stock as follows:

Issuance Date

Expiration Date

Exercise Price

Private Warrants issued to Yeda (see 1 below)

7 unchanged sentences

October 28, 2024

less than $0.001.

In May 2017, in accordance with the 2017 License Agreement (see also Note 10C), the Company issued to Yeda, for nominal consideration, 591,382 warrants to purchase Common Stock at $0.0001 nominal value.

For the year ended December 31, 2019, the Company recorded income of $241 thousand.

For the year ended December 31, 2018 the Company recorded an expense of $584 thousand.

Expenses and income are included in R&D expenses, net in the consolidated statements of comprehensive loss.

236,552 warrants were fully

vested and exercisable on the date of their issuance.

The remainder of the warrants will vest and become exercisable subject to

achievement of certain milestones specified in the agreement as follows:

177,414 upon the filing of a patent application covering

any Discovered Target or a Product,

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

In May 2017, in accordance with

the 2017 License Agreement (see also Note 11C), the Company issued to Yeda, 591,382 warrants to purchase Common Stock

at $0.0001 nominal value, for nominal consideration.

Yeda has the option to exercise the warrants on a cashless basis.

In 2020, the 2017 License Agreement was terminated.

For the year ended December 31,

2020, the Company recorded expense of $233.

For the year ended December 31, 2019, the Company recorded income of $241.

Expenses and income are included in R&D expenses, net in the consolidated statements of operations.

See note 18B regarding

the exercise of warrants.

236,552 warrants were fully vested and exercisable

on the date of their issuance.

The remainder of the warrants will vest and become exercisable subject to achievement of certain

milestones specified in the agreement as follows:

177,414 upon the filing of a patent application

covering any Discovered Target or a Product (both as defined in the 2017 License Agreement).

In 2020 the warrants were cancelled

following termination of the 2017 License Agreement,

118,277 upon achievement of the earlier of the

following milestone by the Company:

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 - SHAREHOLDERS EQUITY (Cont.)

Share-based compensation:

118,277 upon achievement of the earlier of the following

milestone by the Company:

(i) execution of an agreement with a pharmaceutical company

with respect to the commercialization of any of the Company’s licensed technology or the Consulting IP or a Product (both

defined in the 2017 License Agreement) or

(ii) the filing of a patent application covering any Discovered

(USD in thousands, except share and per share data)

STOCKHOLDERS EQUITY (Cont.)

Stock-based compensation:

execution of an agreement with a pharmaceutical

company with respect to the commercialization of any of the Company’s licensed technology or the Consulting IP or a

Product (both defined in the 2017 License Agreement) or

the filing of a patent application covering any Discovered

Target (as defined in the 2017 License Agreement) or a Product.

59,139 upon completion of a Phase 1 clinical trial in respect

of a Product.

In November 2017, the Company issued 7,615 warrants to Yeda and 2,974 warrants to its founders.

All the warrants were fully vested at their grant date and will expire immediately prior to a consummation of an M&A transaction.

The warrants have no exercise price.

In the case of termination of the 2017 License Agreement

after the second anniversary thereof, and provided that none of the aforementioned milestones has been attained prior

to such termination, the warrants will vest upon such termination.

As of December 31, 2020, 118,277 warrants were vested

as the 2017 License Agreement was terminated after the second anniversary with no milestone have been attained.

59,139 upon completion of a Phase 1 clinical

trial in respect of a Product (as defined in the 2017 License Agreement).

In 2020 the warrants were cancelled following the

termination of the 2017 License Agreement.

In November 2017, BiomX Israel issued 7,615

warrants to Yeda and 2,974 warrants to its founders.

All the warrants were fully vested at their grant date and will expire

immediately prior to a consummation of an M&A transaction.

The warrants did not expire as a result of the Recapitalization

Transaction and have no exercise price.

No compensation expenses were recorded in the financial statements during 2020 and

The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering except that the Private Placement Warrants are exercisable for cash (even if a registration statement covering the shares of Common Stock issuable upon exercise of such warrants is not effective) or on a cashless basis, at the holder’s option, and will not be redeemable by the Company, in each case, so long as they are held by the initial purchasers or their permitted transferees.

If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

The Public Warrants became exercisable upon Closing of the Reverse Recapitalization.

The Private Placement Warrants are identical

to the Public Warrants underlying the Units sold in the IPO except that the Private Placement Warrants are exercisable for

cash (even if a registration statement covering the shares of Common Stock issuable upon exercise of such warrants is not

effective) or on a cashless basis, at the holder’s option, and will not be redeemable by the Company, in each case,

so long as they are held by the initial purchasers or their permitted transferees.

If the Private Placement Warrants are held

by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable

by the Company and exercisable by such holders on the same basis as the Public Warrants.

The Company filed a Registration

Statement on Form S-1 for the resale of shares underlying the warrants on December 13, 2019, which was declared effective

on January 3, 2020.

Such Registration Statement was converted to Form S-3 in December 2020.

The Public Warrants became exercisable upon the closing

of the Recapitalization Transaction.

No fractional shares will be issued upon exercise of the Public Warrants.

Therefore, Public Warrants must be exercised in multiples of two warrants.

The Company filed a Registration Statement for the shares underlying the warrants on December 13, 2019 (effective on January 3, 2020).

The Public Warrants will expire five years after the completion of the Reverse Recapitalization or earlier upon redemption or liquidation.

Company may redeem the Public Warrants:

Public Warrants must be exercised in multiples of two warrants.

The Public Warrants will expire five years after the completion

of the Recapitalization Transaction or earlier upon redemption or liquidation.

The Company filed a Registration Statement

on Form S-1 for the resale of shares underlying the warrants on December 13, 2019, which was declared effective on January

Such Registration Statement was converted to Form S-3 in December 2020.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(USD in thousands, except share and per share data)

STOCKHOLDERS EQUITY (Cont.)

Stock-based compensation:

may redeem the Public Warrants:

in whole and not in part;

at a price of $0.01 per warrant;

at any time during the exercise

at any time during the exercise period;

upon a minimum of 30 days’

prior written notice of redemption;

if, and only if, the last sale

price of the Company’s common stock equals or exceeds $16.00 per share for any 20 trading days within a 30-trading day

period ending on the third business day prior to the date on which the Company sends the notice of redemption to the warrant

if, and only if, there is a current

registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption

and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.

the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise

the Public Warrants to do so on a “cashless basis,”

prior written

notice of redemption;

if, and only if, the last sale price of the

Company’s Common Stock equals or exceeds $16.00 per share for any 20 trading days within a 30-trading day period ending

on the third business day prior to the date on which the Company sends the notice of redemption to the warrant holders;

if, and only if, there is a current registration

statement in effect with respect to the shares of Common Stock underlying such warrants at the time of redemption and for

the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.

If the Company calls the

Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants

to do so on a “cashless basis,”

as described in the warrant agreement.

The exercise price and number

of shares of Common Stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event

of a stock dividend, or recapitalization, reorganization, merger or consolidation.

However, the warrants will not be adjusted for

issuance of Common Stock at a price below its exercise price.

Additionally, in no event will the Company be required to net cash

settle the warrants.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

The exercise price and number of shares of

Common Stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock

dividend, or recapitalization, reorganization, merger or consolidation.

However, the warrants will not be adjusted for issuance

of Common Stock at a price below their exercise price.

Additionally, in no event will the Company be required to net cash settle

the warrants.

The following table sets forth the total stock-based

payment expenses resulting from options and warrants granted, included in the statements of operations:

Research and development expenses, net

General and administrative

The Company recognized stock-based compensation expenses

in connection with options granted to executive officers of the Company in the amount of $1,384 and $732 for the years ended December

31, 2020 and 2019, respectively.

The total unrecognized compensation expense was $2,657

and $2,308 as of December 31, 2020 and 2019, respectively.

These expenses will be recognized over a period of approximately 2

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 - R&D EXPENSES, NET

USD In thousands

(USD in thousands, except share and per share data)

RESEARCH AND DEVELOPMENT EXPENSES, NET

Professional service and subcontractors

Salaries and related expenses

Share-based compensation

Stock-based compensation

Materials and supplies

Less Income from Collaboration Agreement (see Note 8)

Rent and related expenses

Less income from collaboration agreements (see Note 11H,10B2)

Less grants from the IIA (see Note 11A)

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 13 - GENERAL AND ADMINISTRATIVE EXPENSES

USD In thousands

GENERAL AND ADMINISTRATIVE EXPENSES

Salaries and related expenses

Incubator overhead

Share-based compensation

Stock-based compensation

Professional services

Travel expenses

Office expenses

Recruitment expenses

Rent and rent related expenses

Rent and related expenses

Insurance expenses

FINANCE INCOME (EXPENSES), NET

USD In thousands

Exchange rate differences

2 unchanged sentences

Bank fees and other

The Company files income tax returns in the U.S.

federal jurisdiction in state and local jurisdictions and is subject to examination by the various taxing authorities.

Income from foreign exchange contracts

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(USD in thousands, except share and per share data)

The Company files income tax returns in the

federal jurisdiction and in state and local jurisdictions and is subject to examination by the various taxing authorities.

The Company’s income tax returns since inception remain open and subject to examination.

Statutory U.S.

federal income tax rate is 21%.

The statutory U.S.

income tax rate is 21%.

As of December 31, 2020, the Company had total net operating losses in the U.S of approximately $3,425,

which may be carried forward and offset against taxable

income in the future.

And RondinX Ltd.

file income tax returns in Israel.

file income tax

returns in Israel.

Their income tax returns since inception remain open and subject to examination.

Statutory Israeli income tax rate is 23%.

of December 31, 2019 and 2018, BiomX Ltd.

had total net operating losses in Israel of approximately $25,883 thousand and $10,556

thousand, respectively, which may be carried forward and offset against taxable income in the future for an indefinite period.

BiomX Ltd is still in its development stage and has not yet generated revenue, therefore, it is more likely than not that sufficient taxable income will not be available for the tax losses to be utilized in the future.

Therefore, a valuation allowance was recorded to reduce the deferred tax assets to its recoverable amounts.

BiomX Inc is still in its development stage, therefore, it is more likely than not that sufficient taxable income will not be available for the tax losses to be utilized in the future.

Therefore, a valuation allowance was recorded to reduce the deferred tax assets to its recoverable amounts.

(FORMERLY CHARDAN HEALTHCARE ACQUISITION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TAXES (Cont.)

The statutory Israeli

income tax rate is 23%.

As of December 31, 2020 and 2019, BiomX Israel

had total net operating losses in Israel of approximately $62,927 and $25,883, respectively, which may be carried forward

and offset against taxable income in the future for an indefinite period.

The Company has evaluated the positive and negative

evidence bearing upon its ability to realize the deferred tax assets.

Management has considered the Company’s history

of cumulative net losses incurred since inception and its lack of commercialization of any products or generation of any revenue

from product sales since inception and has concluded that it is more likely than not that the Company will not realize the

benefits of the deferred tax assets.

Accordingly, a full valuation allowance has been established against the deferred tax

assets as of December 31, 2020 and 2019.

Management reevaluates the positive and negative evidence at each reporting period.

The Company’s policy is to record estimated

interest and penalties related to uncertain tax positions in income tax expense.

The Company has no amounts recorded for any

unrecognized tax positions, accrued interest or penalties as of December 31, 2020 and 2019.

As of December 31,

USD In thousands

Net operating loss carry-forward Biomx Inc.

Net operating loss carry-forward Biomx Ltd.

Net operating loss carryforward BiomX Inc.

Net operating loss carryforward BiomX Ltd.

Total deferred tax assets

2 unchanged sentences

A reconciliation of the U.S.

federal statutory

tax rate and the effective tax rate is as follow:

As of December 31,

USD In thousands

federal statutory tax

rate and the effective tax rate is as follow:

Statutory U.S.

2 unchanged sentences

Business Combination expenses

Valuation allowance

Change in deferred tax asset valuation allowance

Effective tax rate

BASIC LOSS PER SHARE

The basic and diluted net loss per share

and weighted average number of shares of Common Stock used in the calculation of basic and diluted net loss per share are as follows

Loss from operations, before taxes on income, consists

of the following:

As of December 31,

United States

(FORMERLY CHARDAN HEALTHCARE ACQUISITION CORP)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(USD in thousands, except share and per share data)

For the year ended

Net loss attributable to holders of Preferred shares (pre-merger –

Net loss used in the calculation of basic net loss per share

BASIC LOSS PER

The basic and diluted net loss per share and weighted

average number of shares of Common Stock used in the calculation of basic and diluted net loss per share are as follows:

Net loss per share

Weighted average number of Common Stock

As the inclusion of Common Stock share

equivalents in the calculation would be anti-dilutive for all periods presented, diluted net loss per share is the same as basic

net loss per share.

17 - SUBSEQUENT

On March 25, 2020, the Board

of Directors approved the grant of 814,700 options to 67 employees, one consultant, four senior officers (one of whom is a consultant)

and six directors under the 2019 Incentive Plan.

Options were granted at an exercise price of $ 6.21 per share with vesting periods

ranging from three to four years.

Directors and Senior officers are entitled to full acceleration of their unvested options upon

the occurrence of cumulative two certain events.

As the inclusion of shares of Common Stock equivalents

in the calculation would be anti-dilutive for all periods presented, diluted net loss per share is the same as basic net loss

SUBSEQUENT EVENTS

On March 30, 2021, the Board of Directors approved the grant of 985,530 options to 104 employees, one consultant, five senior officers and six directors under the 2019 Incentive Plan, without consideration.

Options were granted at an exercise price of $7.02 per share with a vesting period of four years.

Directors and senior officers are entitled to full acceleration of their unvested options upon the occurrence of both a change in control of the Company and the end of their engagement with the Company.

On March 10, 2021, Yeda exercised 362,444 warrants on a cashless basis, resulting in the issuance of 362,383 shares of Common Stock.

On March 25, 2021, the IIA approved two new applications for a total budget of NIS 19,444 (approximately $5,874).

The IIA committed to funding 30% of the approved budget.

The programs are for the period beginning January 2021 through December 2021.

From January 1, 2021 through March 25, 2021, we issued an aggregate of 600,644 shares of Common Stock pursuant to the ATM Agreement for aggregate net proceeds of $4,324.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures