Company: NCEL
Filing Date: 2025-05-16
Form Type: 20-F
Source: 0001213900-25-044868
Chunk: 240

Company: NewcelX Ltd.
Filing Date: 2025-05-16
Form: 20-F
Item: Item 4
Chunk 240
---
 losses. As of December 31, 2024, we have an accumulated deficit of $74.4 million.

As
of December 31, 2024, our cash and cash equivalents were $1.7 million. We believe that our existing cash and cash equivalents will not
be sufficient to fund our projected operating requirements for a period of one year from the issuance of the financial statements included
elsewhere in this annual report. This raises substantial doubt about our ability to continue as a going concern.

In
November 2024, we announced the Merger Agreement with Kadimastem, a clinical-stage cell therapy company specializing in “off-the-shelf”
allogeneic cell products for neurodegenerative diseases and diabetes. The Merger aims to create a Nasdaq-traded biotechnology company
with a robust portfolio of advanced therapies. Both companies’ boards of directors have unanimously approved the transaction, with
Kadimastem’s shareholders voting in favor and NLS major shareholders holding approximately 40% of NLSs’ common shares having
signed support letters for the NLS shareholders’ meeting anticipated by us to be convened soon. We currently anticipate closing
the Merger in the second quarter of 2025, pending effectiveness of NLSs’ pending registration statement filed with the SEC, Nasdaq
approval, NLSs’ shareholders’ approval and other customary closing conditions.

Components of
Operating Results

Licensing
Agreement

In
February 2019, we entered into the EF License Agreement to develop and commercialize our product candidate, Nolazol, in Latin American
countries with Eurofarma. The EF License Agreement covered the grant of non-transferable licenses, without the right to sublicense, to
Eurofarma to develop and commercialize Nolazol in Latin America. The EF License Agreement also specified our obligation to advance development
activities with respect to Nolazol in the United States.

Under
the EF License Agreement, we received a non-refundable, upfront payment, of $2.5 million in 2019 and were eligible to receive non-refundable
milestone payments of up to $16 million, based on the achievement of milestones related to regulatory filings, regulatory approvals and
the commercialization of Nolazol, as well as tiered royalty payments. As of December 31, 2023, we had long-term deferred revenues of
$2.5 million, which was going to be recognized when the development services of