Company: NCEL
Filing Date: 2025-05-16
Form Type: 20-F
Source: 0001213900-25-044868
Chunk: 142

Company: NewcelX Ltd.
Filing Date: 2025-05-16
Form: 20-F
Item: Item 3
Chunk 142
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 currency
denominated transactions will result in decreased revenue in NIS. Changes in currency exchange rates may have a negative effect on
its financial results.

The termination or reduction of tax and
other incentives that the Israeli government provides to Israeli companies may increase the combined company’s costs and taxes.

The Israeli government currently
provides tax and capital investment incentives to Israeli companies, as well as grant and loan programs relating to research and development
and marketing and export activities. In recent years, the Israeli government has reduced the benefits available under these programs
and the Israeli governmental authorities may in the future further reduce or eliminate the benefits of these programs. The combined company
may take advantage of these benefits and programs in the future; however, there can be no assurance that such benefits and programs will
be available to it. If it qualifies for such benefits and programs and fail to meet the conditions thereof, the benefits could be cancelled
and it could be required to refund any benefits it might already have enjoyed and become subject to penalties. Additionally, if the combined
company qualifies for such benefits and programs and they are subsequently terminated or reduced, it could have an adverse effect on the
combined company’s financial condition and results of operations.

The combined company may be required to
pay monetary remuneration to its Israeli employees for their inventions, even if the rights to such inventions have been duly assigned
to us.

The combined company enters
into agreements with its Israeli employees pursuant to which such individuals agree that any inventions created in the scope of their
employment are either owned exclusively by the combined company or are assigned to it, depending on the jurisdiction, without the employee
retaining any rights. A portion of the combined company’s intellectual property has been developed by its Israeli employees during
their employment for it. Under the Israeli Patent Law, 5727-1967, or the Patent Law, inventions conceived by an employee during the
course of his or her employment and within the scope of said employment are considered “service inventions. Service inventions belong
to the employer by default, absent a specific agreement between the employee and employer otherwise. The Patent Law also provides that
if there is no agreement regarding the remuneration for the service inventions, even if the ownership rights were assigned to the employer,
the Israeli Compensation and Royalties Committee, or the Committee, a body constituted under the Patent Law, shall determine whether the
employee is entitled to remuneration for these inventions. The Committee has not yet determined the method for calculating this Committee-enforced
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