12:31 PM EDT, 07/29/2024 (MT Newswires) -- NLS Pharmaceutics ( NLSP ) and cell therapy company Kadimastem said Monday that they signed a binding term sheet for a merger transaction, with Kadimastem becoming a subsidiary of NLS after the deal.

The proposed merger transaction will see NLS issuing shares to Kadimastem shareholders who will own 85% of NLS' outstanding share capital upon completion, according to the statement. NLS shareholders will own the remaining 15% interest.

NLS' and Kadimastem's boards have approved the transaction and the companies said they have received commitments of support for the merger from shareholders representing over 40% of their respective shares. Upon completion, the combined company is expected to operate as Kadimastem and be listed on Nasdaq, while NLS will also retain its Nasdaq listing, they said.

The firms said they plan to continue developing NLS's Dual Orexin Agonist platform following the merger, while the rest of NLS assets are expected to be divested. They expect to execute a deal in September and complete the transaction before Dec. 31.

Shares of NLS Pharmaceutics ( NLSP ) were up about 38% in recent trading.

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