On May 10, 2020, Chemomab entered into an office and lab space lease agreement (hereinafter – “The Agreement” .(According to the Agreement, Chemomab will rent space in Atidim Park, Tel-Aviv through May 2023. Chemomab was granted an option to extend the lease term by additional three years. The annual rent and management fees were approximately USD 71 thousand. Pursuant to the Agreement, a bank guarantee of NIS 170 thousand (approximately USD 49 thousand) was issued to the property owner in 2020.

On October 24, 2021, Chemomab signed an amendment to the Agreement ("The Amendment"). According to the Amendment, On December 12, 2021 Chemomab returned the previous office and lab space to the property owner and rented a larger space in Atidim Park Tel-Aviv, through October 2024. In addition, Chemomab was granted an option to extend the lease term by additional three years. The annual rent and management fees are approximately USD 132 thousand. Pursuant to the Amendment, the bank guarantee issued in 2020 was canceled and a substitute bank guarantee of approximately USD 86 thousand was issued to the property owner during 2022.

The above operating leases are included in “Operating lease right-of-use assets” on the Company’s Consolidated Balance sheets as of December 31, 2021 and 2020 and represent the Company’s right to use the underlying asset for the lease term. The Company’s obligations to pay lease payments are included in the current liabilities as “Operating lease liabilities” and in the non-current liabilities as “Non-current operating lease liabilities” on the Company’s Consolidated Balance sheets as of December 31, 2021 and 2020. Based on the present value of the lease payments for the remaining lease term of the Company’s existing lease agreement, the Company recognized operating right-of-use assets and operating lease liabilities of approximately USD 345 thousand on December 12, 2021.

During the years ended December 31, 2021 and 2020, the Company recognized an increase in right of use assets of USD 345 thousand and USD 500 thousand, respectively.

As of December 31, 2021, operating right-of-use assets and operating lease liabilities were USD 345 thousand and USD 343 thousand, respectively.

F - 14

Chemomab Therapeutics Ltd. and its subsidiaries

Notes to the Financial Statements as at December 31, 2021

Note 6 - Leases (cont’d)

As most of the Chemomab’s leases do not provide an implicit rate, Chemomab uses its incremental borrowing rate based on the information available at the commencement date of each lease in determining the present value of lease payments. Chemomab’s incremental borrowing rate is a hypothetical rate based on its estimation of what its credit rating would be the rate was5.2% in both 2021 and 2020.

Maturities of lease liabilities under noncancellable leases as of December 31, 2021, are as follows: (in thousands):

2022	121
2023	133
2024	117
Total future minimum lease payments	371
Less imputed interest:	(28	)
Present value of operating lease liabilities	343