Nexentis (NXTS) 10-Q for FY2020 Q3, filed Nov 12, 2020

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X]	QUARTERLY<br>REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2020

[ ]	TRANSITION<br>REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 000-56100

SAVE<br>FOODS, INC.
(Exact<br>name of registrant as specified in its charter)
Delaware		26-468460
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(State<br>or other jurisdiction of<br><br>incorporation<br>or organization)		(I.R.S.<br>Employer<br><br>Identification<br>No.)
Raoul<br>Wallenberg 20
---	---	---
Tel<br>Aviv, Israel		6971011
(Address<br>of Principal Executive Offices)		(Zip<br>Code)
+972<br>544 561349
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(Registrant’s<br>telephone number, including area code)

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(Former<br>name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title<br>of each class		Trading<br>Symbol(s)		Name<br>of exchange on which registered
N/A		N/A		N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

[ ]	Large<br>accelerated filer	[ ]	Accelerated<br>filer
[X]	Non-accelerated<br>filer	[X]	Smaller<br>reporting company
		[ ]	Emerging<br>growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

As of November 10, 2020, the registrant had 11,202,146 shares of common stock, par value $0.0001, of the registrant issued and outstanding.

As used in this Quarterly Report and unless otherwise indicated, the terms “Save Foods,” “we,” “us,” “our,” or “our Company” refer to Save Foods, Inc. Unless otherwise specified, all dollar amounts are expressed in United States dollars.

Save Foods, Inc.

Quarterly Report on Form 10-Q

TABLE OF CONTENTS

		Page

Cautionary Note Regarding Forward-Looking Statements		3

PART 1-FINANCIAL INFORMATION

Item<br>1.	Consolidated Financial Statements (unaudited)

	Consolidated Balance Sheets	6

	Consolidated Statements of Comprehensive Loss	7

	Statements of Stockholders’ Equity	8

	Consolidated Statements of Cash Flows	9

	Notes to Consolidated Financial Statements	10

Item<br>2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item<br>4.	Control and Procedures	23

PART II-OTHER INFORMATION

Item<br>1A.	Risk Factors	24

Item<br>6.	Exhibits	25

SIGNATURES		26
2
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain information set forth in this Quarterly Report on Form 10-Q, including in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere herein may address or relate to future events and expectations and as such constitutes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements which are not historical reflect our current expectations and projections about our future results, performance, liquidity, financial condition, prospects and opportunities and are based upon information currently available to us and our management and their interpretation of what is believed to be significant factors affecting our business, including many assumptions regarding future events. Such forward-looking statements include statements regarding, among other things:

	●	sales<br>of our products;
	●	the<br>size and growth of our product market;
	●	our<br>activity in the civilian market;
	●	our<br>manufacturing capabilities;
	●	our<br>entering into certain partnerships with third parties;
	●	obtaining<br>required regulatory approvals for sales or exports of our products;
	●	our<br>marketing plans;
	●	our<br>expectations regarding our short- and long-term capital requirements;
	●	the<br>effect of COVID-19 on our business;
	●	our<br>outlook for the coming months and future periods, including but not limited to our expectations regarding future revenue and<br>expenses; and
	●	information<br>with respect to any other plans and strategies for our business.

Forward-looking statements, which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by use of the words “may,” “should,” “would,” “could,” “scheduled,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “seek,” or “project” or the negative of these words or other variations on these words or comparable terminology. Actual results, performance, liquidity, financial condition and results of operations, prospects and opportunities could differ materially and perhaps substantially from those expressed in, or implied by, these forward-looking statements as a result of various risks, uncertainties and other factors. These statements may be found under the section of our Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020) (“2019 Annual Report”) entitled “Risk Factors” as well as in our other public filings.

In light of these risks and uncertainties, and especially given the start-up nature of our business, there can be no assurance that the forward-looking statements contained herein will in fact occur. Readers should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

3

SAVE FOODS, INC.

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

4

SAVE FOODS, INC.

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

IN U.S. DOLLARS

TABLE OF CONTENTS

	Page
CONDENSED<br>CONSOLIDATED FINANCIAL STATEMENTS:
Condensed Consolidated Balance sheets as of September 30, 2020 (unaudited), and December 31, 2019	6
Condensed<br>Consolidated Statements of Comprehensive Loss for the<br>nine months and three months ended September 30, 2020 and 2019 (unaudited)	7
Condensed Consolidated Statements of stockholders’ deficit for the nine months ended September 30, 2020 (unaudited) and the year ended December 31, 2019	8
Condensed Consolidated Statements of cash flows for the nine months ended September 30, 2020 and 2019 (unaudited)	9
Notes to unaudited condensed consolidated financial statements	10<br>- 19
5
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SAVE FOODS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars except share and per share data)

	September<br>30,			December<br>31,
	2020			2019
		(Unaudited)
A s s e t s
Current Assets
Cash<br>and cash equivalents		310,571			290,815
Restricted cash		38,361			38,194
Accounts receivable,<br>net		-			64,003
Inventories		11,267			16,302
Other current assets		34,098			15,300
T<br>o t a l Current assets		394,297			424,614
Right-of-Use Asset<br>Arising from Operating Lease		17,168			48,982

Property and Equipment,<br>Net		58,885			81,119

Funds in Respect<br>of Employee Rights Upon Retirement		113,009			109,955
T<br>o t a l Assets		583,359			664,670

Liabilities and<br>Shareholders’ Deficit
Current Liabilities
Short-term loan<br>from banking institution		7,385			7,230
Current maturities<br>of convertible loans (Note 3)		31,250			-
Accounts payable		209,917			235,864
Other accounts payable		455,676			380,732
T<br>o t a l Current Liabilities		704,228			623,826
Fair Value of Convertible<br>Component in Convertible Loans (Note 3)		18,692			-
Convertible Loans<br>(Note 3)		75,250			285,917
Long term from Banking<br>Institution		9,454			14,955
Liability for Employee<br>Rights Upon Retirement		146,665			142,091
T<br>o t a l Liabilities		954,289			1,066,789

Stockholders’<br>Deficit
Common stock par<br>value 0.0001 per share (the “Common Stock”): 495,000,000 shares authorized as of September 30, 2020<br>and December 31, 2019; issued and outstanding 11,202,146 and 10,209,487 shares as of September 30, 2020 and December 31, 2019,<br>respectively.		1,120			1,021
Preferred stock<br>par value 0.0001 per share (“Preferred Stock”): 5,000,000 shares authorized as of<br>September 30, 2020 and December 31, 2019; issued and outstanding 0 shares as of September 30, 2020 and December 31, 2019.		-			-
Additional paid-in<br>capital		11,743,602			10,328,696
Foreign currency<br>translation adjustments		(26,275	)		(26,275	)
Accumulated deficit		(12,061,100	)		(10,684,508	)
		(342,653	)		(381,066	)
Non-Controlling<br>Interests		(28,277	)		(21,053	)
T<br>o t a l Stockholders’ Deficit		(370,930	)		(402,119	)
T<br>o t a l Liabilities and Stockholders’ Deficit		583,359			664,670

All values are in US Dollars.

The accompanying notes are an integral part of the condensed consolidated financial statements.

6

SAVE FOODS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(U.S. dollars except share and per share data)

	Nine<br>months ended						Three<br>months ended
	September<br>30						September<br>30
	2020			2019			2020			2019
	(Unaudited)						(Unaudited)
Revenues from sales of products		63,566			129,733			-			-
Cost of sales		(25,686	)		(99,035	)		-			-
Gross<br>profit		37,880			30,698			-			-
Research and development expenses		(340,808	)		(371,407	)		(87,465	)		(152,404	)
Selling and marketing expenses		(43,482	)		(378,610	)		(6,734	)		(120,449	)
General and administrative<br>expenses		(851,262	)		(659,629	)		(337,886	)		(231,878	)
Operating<br>loss		(1,197,672	)		(1,378,948	)		(432,085	)		(504,731	)
Financing expenses, net		(206,829	)		(31,123	)		(6,478	)		(9,805	)
Other income		881			-			881			-
Share in losses of affiliated company		-			(10,850	)		-			(4,468	)
Gain on disposal<br>of affiliated company		15,690			-			-			-
Net<br>loss		(1,387,930	)		(1,420,921	)		(437,682	)		(519,004	)

Less: Net loss<br>attributable to non-controlling interests		11,338			13,489			3,782			4,757
Net<br>loss attributable to the Company		(1,376,592	)		(1,407,432	)		(433,900	)		(514,247	)

Loss<br>per share (basic and diluted)		(0.13	)		(0.14	)		(0.04	)		(0.05	)

Basic<br>and diluted weighted average number of shares of Common Stock outstanding		10,442,832			9,886,403			10,904,449			10,171,443

The accompanying notes are an integral part of the condensed consolidated financial statements.

7

SAVE FOODS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFECIT

(U.S. dollars, except share and per share data)

	Number of shares		Amount		Additional paid-in capital		Accumulated other comprehensive income (loss)			Proceeds on account of shares			Accumulated deficit			Total Company’s stockholders’ equity			Non-<br><br>controlling interests			Total<br><br>stockholders’ deficit
BALANCE AT JANUARY 1, 2019		9,228,339		923		8,851,670		(26,275	)		105,000			(8,713,091	)		218,227			(6,712	)		211,515
CHANGES DURING THE PERIOD OF NINE MONTHS ENDED SEPTEMBER 30, 2019:
Issuance of shares for cash		981,148		98		945,595		-			(105,000	)		-			840,693			-			840,693
Stock based compensation		-		-		240,871		-			-			-			240,871			2,579			243,450
Comprehensive loss for the nine months ended<br>September 30, 2019		-		-		-		-			-			(1,407,432	)		(1,407,432	)		(13,489	)		(1,420,921	)
BALANCE AT SEPTEMBER 30, 2019 (Unaudited)		10,209,487		1,021		10,038,136		(26,275	)		-			(10,120,523	)		(107,641	)		(17,622	)		(125,263	)
	Number of Shares		Amount		Additional paid-in capital		Accumulated other comprehensive income (loss)			Proceeds on account of shares		Accumulated deficit			Total Company’s stockholders’ equity			Non-<br>controlling interests			Total<br>stockholders’ deficit
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
BALANCE AT JANUARY 1, 2019		10,209,487		1,021		10,328,696		(26,275	)		-		(10,684,508	)		(381,066	)		(21,053	)		(402,119	)
CHANGES DURING THE PERIOD OF NINE MONTHS ENDED SEPTEMBER 30, 2020:
Issuance of shares for cash		321,102		32		349,968		-			-		-			350,000			-			350,000
Conversion of convertible loans		471,557		47		620,580		-			-		-			620,627			-			620,627
Exercise of warrants		200,000		20		59,980		-			-		-			60,000			-			60,000
Stock based compensation		-		-		384,378		-			-		-			384,378			4,114			388,492
Comprehensive loss for the nine months ended<br>September 30, 2020		-		-		-		-			-		(1,376,592	)		(1,376,592	)		(11,338	)		(1,387,930	)
BALANCE AT SEPTEMBER 30, 2020 (Unaudited)		11,202,146		1,120		11,743,602		(26,275	)		-		(12,061,100	)		(342,653	)		(28,277	)		(370,930	)

The accompanying notes are an integral part of the condensed consolidated financial statements.

8

SAVE FOODS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars except)

	Nine<br>months ended
	September<br>30,
	2020			2019
	(Unaudited)
CASH<br>FLOWS FROM OPERATING ACTIVITIES:
Net<br>loss for the period		(1,387,930	)		(1,420,921	)
Adjustments<br>required to reconcile net loss for the period to net cash used in operating activities:
Depreciation<br>and amortization		42,458			12,410
Share<br>in losses of affiliated company		-			10,851
Gain<br>on disposal of affiliated company		(15,690	)		-
Increase<br>in liability for employee rights upon retirement		4,574			15,875
Stock<br>based compensation		388,492			243,450
Expenses<br>on convertible loans		141,981			1,370
Conversion<br>of convertible loans		57,793			-
Increase<br>in accounts receivable		64,003			135,297
Decrease<br>in inventory		5,035			38,085
Decrease<br>(increase) in other current assets		(16,094	)		8,210
Increase<br>(decrease) in accounts payable		(25,947	)		57,615
Increase<br>in other accounts payable		121,928			17,978
Net<br>cash used in operating activities		(619,397	)		(879,780	)

CASH<br>FLOWS FROM INVESTING ACTIVITIES:
Payments<br>on (proceeds from) investment in unconsolidated entity		4,863			(7,567	)
Short<br>term deposits in banking institutions		-			(37,909	)
Purchase<br>of property and equipment		-			(4,919	)
Increase<br>in funds in respect of employee rights upon retirement		(3,054	)		(10,670	)
Net<br>cash used in investing activities		1,809			(61,065	)

CASH<br>FLOWS FROM FINANCING ACTIVITIES:
Secured<br>promissory notes		135,000			-
Convertible<br>loans		125,000			-
Repayments<br>of right of use asset arising from operating lease		(27,272	)		-
Repayments<br>of long-term banking institute		(5,384	)		(40,227	)
Exercise<br>of warrants		60,000			-
Proceeds<br>from stock issued for cash		350,000			840,693
Net<br>cash provided by financing activities		637,344			800,466

INCREASE<br>(DECREASE) IN CASH AND CASH EQUIVALENTS		19,756			(140,379	)
CASH<br>AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		290,815			439,806
CASH<br>AND CASH EQUIVALENTS AT END OF PERIOD		310,571			229,427

Supplemental<br>disclosure of cash flow information:
Cash<br>paid during the year for:
Interest		316			1,082
Non-cash<br>transactions:
Disposal<br>of affiliated company		2,704			-
Termination<br>of lease agreement		11,590
Issuance<br>of warrants in convertible loans		53,388			-
Conversion<br>of convertible loans		528,138			-

The accompanying notes are an integral part of the condensed consolidated financial statement

9

SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 1 - GENERAL

Save Foods, Inc. (the “Company”) was incorporated on April 1, 2009, under the laws of the State of Delaware. On April 27, 2009, the Company acquired from its stockholders all the issued and outstanding shares of Save Foods Ltd. (formerly Pimi Agro Cleantech Ltd.) (“Save Foods Israel”), including preferred and ordinary shares (the Company and Save Foods Israel, collectively, the “Group”).

Save Foods Israel was incorporated in 2004 and commenced its operations in 2005. Save Foods Israel develops, produces, and focuses on delivering innovative solutions for the food industry aimed at improving food safety and prolonging shelf life of fresh produce.

In February 2010, the Company’s shares of Common Stock were initially quoted on the OTC Bulletin Board under the symbol “PIMZ.OB.” As of the date of these financial statements, the Company’s Common Stock quoted on the OTC Pink under the symbol “SAFO.”

Going Concern

Since its incorporation (April 1, 2009), the Company has not had any operations other than those carried out by Save Foods Israel. The development and commercialization of Save Foods Israel’s products will require substantial expenditures. Save Foods Israel and the Company have not yet generated sufficient revenues from their operations to fund the Group activities and are therefore dependent upon external sources for financing their operations. There can be no assurance that Save Foods Israel and the Company will succeed in obtaining the necessary financing to continue their operations. As of September 30, 2020, the Company had $310,571 in cash, a negative working capital of $309,931 and an accumulated deficit of $12,061,100.

The Company will need to secure additional capital in the future in order to meet its anticipated liquidity needs primarily through the sale of additional Common Stock or other equity securities and/or debt financing. Funds from these sources may not be available to the Company on acceptable terms, if at all, and the Company cannot give assurance that it will be successful in securing such additional capital.

The Company focuses its solutions towards vegetables and fruits which are considered the largest in terms of worldwide consumption. Among other things, the Company commenced cooperation with certain major fruit packing houses in Israel and abroad.

These factors raise substantial doubt about Save Foods Israel and the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

On March 11, 2020, the World Health Organization declared the outbreak of a novel strain of coronavirus (SARS-CoV-2) to be a global pandemic (COVID-19), which continues to spread throughout the United States and around the world. The COVID-19 pandemic is having significant effects on global markets, supply chains, businesses, and communities. COVID-19 may impact various aspects of the Company’s operations and financial results during the year 2020, including, but not limited to, reduction is sales, difficulties in obtaining additional financing, or potential shortages of personnel. The Company believes it is taking appropriate actions to mitigate the negative impacts. However, the full impact of COVID-19 is unknown and cannot be reasonably estimated as these events occurred subsequent to year end and are still developing.

10

SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION

Unaudited Interim Financial Statements

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiary, prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q. In the opinion of management, the financial statements presented herein have not been audited by an independent registered public accounting firm but include all material adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the financial condition, results of operations and cash flows for the nine months ended September 30, 2020. However, these results are not necessarily indicative of results for any other interim period or for the year ended December 31, 2020. The preparation of financial statements in conformity with GAAP requires the Company to make certain estimates and assumptions for the reporting periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses. Actual amounts could differ from these estimates.

Certain information and footnote disclosures normally included in financial statements in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the United States Securities and Exchange Commission (“SEC”). These financial statements should be read in conjunction with the financial statements and notes thereto contained in the Company’s Annual Report for the year ended December 31, 2019.

Principles of Consolidation

The consolidated financial statements are prepared in accordance with GAAP. The consolidated financial statements of the Company include the Company and its wholly-owned and majority-owned subsidiaries. All inter-company balances and transactions have been eliminated.

Use of Estimates

The preparation of unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, certain revenues and expenses, and disclosure of contingent assets and liabilities as of the date of the financial statements. Actual results could differ from those estimates. As applicable to these financial statements, the most significant estimates and assumptions relate to the going concern assumptions, share based compensation and convertible loans.

11

SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION (continue)

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. In November 2018, the FASB issued ASU No. 2018-19, “Codification Improvements to Topic 326, Financial Instruments – Credit Losses,” which amends the scope and transition requirements of ASU 2016-13. Topic 326 requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount. Topic 326 will originally become effective for the Company beginning January 1, 2020, with early adoption permitted, on a modified retrospective approach. As a smaller reporting company, the effective date for the Company has been delayed until fiscal years beginning after December 15, 2022, in accordance with ASU 2019-10, although early adoption is still permitted. This standard is not expected to have a material impact to the Company’s consolidated financial statements after evaluation.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” and subsequent amendments, which replaced existing lease guidance in GAAP and requires lessees to recognize right-of-use (“ROU”) assets and lease liabilities on the balance sheet for leases longer than twelve months and disclose key information about leasing arrangements. The Company adopted the standard on January 1, 2019 using the modified retrospective method and used the effective date as our date of initial application. Financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. The new standard provides a number of optional practical expedients for transition. The Company elected the package of practical expedients under the transition guidance which permits the Company not to reassess under the new standards our prior conclusions for lease identification and lease classification on expired or existing contracts and whether initial direct costs previously capitalized would qualify for capitalization under Accounting Standards Codification (“ASC”) 842. The Company did not elect the hindsight practical expedient to determine the reasonably certain lease term for existing leases.

The new standard also provides practical expedients and recognition exemptions for an entity’s ongoing accounting policy elections. The Company elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, we will not recognize ROU assets or lease liabilities. The Company also elected the practical expedient not to separate lease and non-lease components for all of our leases.

The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In June 2018, the FASB issued ASU 2018-07, “Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-based Payment Accounting.” The standard expands the scope of Topic 718 to include share-based payments issued to nonemployees for goods or services, simplifying the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees, with certain exceptions. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years with early adoption permitted, including adoption in an interim period. The Company adopted this ASU on January 1, 2019. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements and related disclosures.

12

SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION (continue)

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”. The amendments in this ASU simplify the accounting for income taxes, eliminates certain exceptions to the general principles in Topic 740 and clarifies certain aspects of the current guidance to improve consistent application among reporting entities. ASU 2019-12 is effective for fiscal years beginning after December 15, 2021 and interim periods within annual periods beginning after December 15, 2022, though early adoption is permitted, including adoption in any interim period for which financial statements have not yet been issued. This standard is not expected to have a material impact to the Company’s consolidated financial statements after evaluation.

NOTE 3 – CONVERTIBLE LOANS

	A.	In<br>December 2019, the Company entered into a series of Convertible Loan Agreements (each a “CLA”) with third parties<br>and certain existing shareholders (the “Lenders”), pursuant to which the Lenders agreed to provide the Company<br>loans in the aggregate amount of $379,000 and in exchange the Company issued to the Lenders (i) convertible promissory notes<br>(the “Notes”) and (ii) warrants with an exercise price of $1.20. In January and March 2020, the Company entered<br>into two additional CLA agreements for an aggregate amount of $135,000, consisting of the same terms.

		According<br>to the terms of the CLA, the Notes bear interest at a rate of 5% per annum and the loan amount represented by the Notes<br>is to be repaid to the Lenders according to the following schedule: (i) the principal amount represented by the Notes<br>to be repaid in twenty four equal monthly installments, commencing on the twenty fifth month following the closing of each<br>CLA, and (ii) the interest accrued on the loan amount to be paid in two bi-annual installments, commencing on the first<br>anniversary of the first payment of the principal amount.

		In<br>addition, according to the terms of the CLA, the outstanding<br>loan amount matures on the earlier of (i) the third anniversary of each CLA or (ii) a deemed liquidation event (as<br>defined therein), and the Lenders may convert all or any portion of the Notes at any time prior to the one-year anniversary<br>of each issuance into shares of the Company’s Common Stock at a conversion price of $1.20 per share.

		In<br>accordance with ASC 815-15-25, the conversion feature was considered embedded derivative instruments, and is to be<br>recorded at their fair value as its fair value can be separated from the convertible loan and its conversion is independent<br>of the underlying note value. The Company recorded finance expenses in respect of the convertible component in the convertible<br>loan in the excess amount of the convertible component fair value over the face loan amount. The conversion liability is then<br>marked to market each reporting period with the resulting gains or losses shown in the statements of operations.

		As<br>a result of the above issuances, the Company recorded in the periods ended March 31, 2020 and December 31, 2019, a<br>total amount of $34,696 and $97,406, respectively, in respect of the detachable warrants, as a credit to stockholders’<br>equity (additional paid in capital). The fair value of the Warrants was determined using the Black-Scholes pricing model,<br>assuming a risk free rate of 1.6%, a volatility factor of 54.00%, dividend yields of 0% and an expected life of 3 years.
13
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SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 3 – CONVERTIBLE LOANS (continue)

		On<br>June 24, 2020, the Company entered into a Securities Purchase Agreement (the “SPA”) with the Lenders in connection<br>with the sale and issuance of 485,318 units (“Units”), at a purchase price of $1.09 per Unit. Each Unit consists<br>of: (i) one share of Common Stock and (ii) one warrant to purchase one share of Common Stock with an exercise price of $1.20<br>(the “Warrant”). In connection with the SPA, the Company issued to the Lenders an aggregate of 485,318 shares<br>of Common Stock and Warrants to purchase an aggregate of 485,318 shares of Common Stock. The shares of Common Stock were issued<br>on July 2, 2020.

		Simultaneous<br>with and conditioned upon the execution of the SPA, the Company and each of the Lenders agreed to effectively cancel the CLA<br>and the equity securities issued thereunder. In connection therewith, each of the Lenders voluntarily waived any right to<br>receive interest that accrued thereupon pursuant to the CLA.

		The<br>Company evaluated the transaction as an exchange of instruments and as a result of the above conversion, recorded a compensation<br>expenses in a total amount of $57,793, in the nine months ended September 30, 2020, and as a credit to stockholders’<br>equity (additional paid in capital). The fair value of the additional shares granted in the conversion was calculated based<br>on the Company’s share price as of the date of the conversion. The fair value of the additional warrants granted in<br>the conversion was determined using the Black-Scholes pricing model, assuming a risk-free rate of 0.21%, a volatility<br>factor of 51.96%, dividend yields of 0% and an expected life of 2.45-2.71 years.

		During<br>the periods ended September 30, 2020 and December 31, 2019, the Company recorded net interest and amortization expenses in<br>the amount of $141,917 and $4,323, respectively, in respect of the discounts recorded on the CLAs.

	B.	On<br>September 21, 2020, the Company entered into a series of<br>additional convertible loan agreements (each a “2020 CLA”) with certain lenders (the “2020 Lenders”)<br>to sell convertible promissory notes with an aggregate principal amount of $125,000 (each a “2020 Note”). The<br>outstanding loan amount under the 2020 CLA will mature on the earlier of (i) the third anniversary of each 2020 CLA or (ii)<br>a deemed liquidation event (as defined therein), and the 2020 Lenders may convert all or any portion of the 2020 Notes into<br>shares of Common Stock at any time prior to a mandatory conversion event (as defined therein) at a conversion price of $1.09<br>per share. The 2020 Notes will bear interest at a rate of 5% per annum. The loan amount represented by the 2020 Notes will<br>be repaid to the 2020 Lenders according to the following schedule: (i) the principal amount represented by the 2020 Notes<br>will be repaid in four bi-annual installments, commencing on the first anniversary following the closing of each 2020 CLA,<br>and (ii) the interest accrued on the loan amount will be paid in two bi-annual installments, commencing on the first anniversary<br>of the first payment of that principal amount.

		As<br>part of the 2020 CLA, the Company entered into a registration rights agreement with each of the 2020 Lenders, whereby<br>each 2020 Lender received piggyback registration rights for the shares issuable upon conversion of the 2020 Notes to shares<br>of Common Stock.
14
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SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The loans are convertible into common Stock upon (i) a completion of underwritten public offering (“Mandatory Conversion”) convert the outstanding loan amount at a share price as shall be determined in the offering, or (ii) at the lender’s discretion (“Optional Conversion”) convert the outstanding loan amount at a share price per share of $1.09.

In accordance with ASC 815-15-25, the conversion feature was considered embedded derivative instruments, and is to be recorded at their fair value as its fair value can be separated from the convertible loan and its conversion is independent of the underlying note value. The Company recorded finance expenses in respect of the convertible component in the convertible loan in the excess amount of the convertible component fair value over the face loan amount. The conversion liability is then marked to market each reporting period with the resulting gains or losses shown in the statements of operations.

The fair value of the convertible component was estimated by third party appraiser as weighted average of the two possible scenarios of the total loan amount conversion: 70% probability for the Mandatory Conversion and 30% probability for the Optional Conversion.

The Mandatory Conversion was estimated by the appraiser using the Black-Scholes option pricing model, to compute the fair value of the derivative and to market the fair value of the derivative at each balance sheet date. The Company has estimated the fair value of such derivative at a value of $15,208 as of September 21, 2020. The following are the data and assumptions used as of the balance sheet date:


Dividend<br>yield	0
Risk-free interest<br>rate	0.19	%
Expected term (years)	0.775
Volatility	51.96	%
Share price	0.96
Exercise price	1.09

The Optional Conversion was estimated by the appraiser using binomial option pricing model and simulating and waiver of the lender as an exercise price, to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The Company has estimated the fair value of such derivative at a value of $26,824 as of September 21, 2020. The following are the data and assumptions used as of the balance sheet date:


Dividend<br>yield	0
Risk-free interest<br>rate	0.12%-0.16%
Volatility	51.96	%
Share price	0.96

The fair value of the convertible component was estimated by the third-party appraiser after giving effect to the weighted average of the two possible scenarios at $18,692.

The fair value allocated to the convertible loan was estimated by third party appraiser as the residual value of the proceeds net of the convertible component and was estimated at a value of $106,308 at the issuance date.

15

SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 4 – COMMON STOCK

On May 9, 2019, the Company entered into a Securities Purchase Agreement (the “May Agreement”) with an existing shareholder (the “Investor”), pursuant to which the Company sold to the Investor for an aggregated amount of $100,000, 91,743 units at a price per unit of $1.09 (the “2019 Units”), each 2019 Unit consists of (i) one share of Common Stock and (ii) one warrant to purchase one share of Common Stock with an exercise price of $1.20 for a period of 36 months following the issuance date. The shares of Common Stock were issued on July 2, 2020.

On July 2, 2020, the Company issued 471,557 shares of Common Stock in respect of the conversion of convertible loans as detailed in Note 3A above.

During July and August 2020, the Company entered into additional Securities Purchase Agreements with existing shareholders (the “Additional Investors”), pursuant to which the Company sold to the Additional Investors for an aggregate amount of $150,000, 137,616 units, based substantially upon the same terms as in the May Agreement.

On September 23, 2020, the Company entered into a Securities Purchase Agreement (the “Medigus SPA”) with Medigus Ltd. (“Medigus”) in connection with the sale and issuance of 91,743 units for total consideration of $100,000, based substantially upon the same terms as in the May Agreement.

The Medigus SPA contemplates an additional investment by Medigus not to exceed $25,000 (the “Additional Medigus Investment”), which shall be triggered following the parties’ initiation of a proof of concept procedure to test the effectiveness of the Company’s sanitizers and its residual effects against different pathogens. In consideration for the Additional Medigus Investment, the Company has agreed to issue an additional 22,935 units at a purchase price of $1.09, which units shall contain the same composition of securities as described in the foregoing description of the Medigus SPA.

On September 22, 2020 and September 24, 2020, the Chairman of the Board of Directors of the Company (the “Board”), exercised a warrant to purchase an aggregate of 200,000 shares of Common Stock, which warrants were granted to him on June 15, 2020 by the Board as a replacement for his recently expired options, which were previously granted to him in April 2018.

16

SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 5 – STOCK OPTIONS

On June 23, 2020, the Company granted 148,000 options to purchase its Common Stock under the 2018 Equity Incentive Plan (the “Plan”). The options shall vest quarterly over two years commencing June 23, 2020, whereby 12.50% of the shares covered by the options will vest on the three month anniversary of June 23, 2020, and 12.50% of the shares covered by the options will vest at the end of each subsequent three month period thereafter over the course of the subsequent 21 months.

On July 1, 2020, the Company granted 500,000 options to purchase its Common Stock under the 2018 Equity Incentive Plan. The options shall vest quarterly over two years commencing June 1, 2020, whereby 12.50% of the shares covered by the options will vest on the three month anniversary of June 1, 2020, and 12.50% of the shares covered by the options will vest at the end of each subsequent three month period thereafter over the course of the subsequent 21 months. The fair value of the options was estimated at a value of $344,767 at the date of issuance using the Black-Scholes option pricing model.

In addition, on July 1, 2020, the Board approved an increase to the share option pool under the Plan by 696,258 shares of Common Stock, such that after the increase the total number of shares of Common Stock issuable under the Plan is 2,029,591 shares of Common Stock.

On September 22, 2020, the Board approved an amendment of the terms of the outstanding options granted to certain employees and directors of the Company. According to the new terms, subject to the consummation of equity financing in excess of $1,000,000 and the completion of listing of the Company’s Common Stock for trade on the Nasdaq, and in the event that the employment or engagement of such grantee is either terminated (not for cause) or otherwise changed thereby resulting in the conclusion of such engagement (including voluntary resignation), all outstanding options of such grantee shall vest immediately and shall be exercisable for a period of three years following the termination date.

The following table presents the Company’s stock option activity for employees and directors of the Company for the nine months ended September 30, 2020:


Outstanding<br>at December 31,2019	1,150,004		0.45
Granted	648,000		0.525
Exercised	-		-
Forfeited<br>or expired	(216,668	)	0.45
Outstanding<br>at September 30, 2020	1,581,336		0.488
Number<br>of options exercisable at September 30, 2020	544,890		0.475

The aggregate intrinsic value of the awards outstanding as of September 30, 2020 is $952,198. These amounts represent the total intrinsic value, based on the Company’s stock price of $1.09 as of September 30, 2020, less the weighted exercise price. This represents the potential amount received by the option holders had all option holders exercised their options as of that date.

Costs incurred in respect of stock-based compensation for employees and directors, for the nine and three months ended September 30, 2020 were $388,492 and $168,825, respectively.

17

SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 6 – COMMITEMENTS

	(1)	On<br>September 22, 2020, the Company entered into a non-exclusive Commission Agreement with Earthbound Technologies, LLC (“EBT”)<br>for a period of 12 months, according to which EBT shall introduce the Company to potential clients, pre-approved by the Company<br>(“Introduced Parties”) and shall assist the Company in finalizing commercial agreements with the Introduced Parties.<br>In consideration for its services, the Company agreed to pay EBT 12.5% of the net revenues generated from Introduced<br>Parties (during the agreement period and within 18 months following the termination of the agreement) up to a total aggregated<br>amount of $2,000,000, provided that the compensation shall not exceed 25% of the Company’s gross profit under the given<br>commercial agreement signed with the Introduced Party. In addition, in the event that the aggregated net revenues generated<br>from Introduces Parties exceeds $500,000, and subject to the approval of the Board, the Company shall issue to EBT 50,000<br>options to purchase 50,000 shares of Common Stock at an exercise price of $1.2 per share. In the event that certain additional<br>events detailed in the agreement occur, the Company will also issue to EBT, subject to the approval of the Board, an additional<br>50,000 options to purchase 50,000 shares of Common Stock at an exercise price of $1.2 per share.

	(2)	On<br>September 22, 2020, the Company entered into a Distribution Agreement (the “Distribution Agreement”), with<br>Safe-Pack Products Ltd (“Safe-Pack”) according to which the Company granted Safe-Pack an exclusive right<br>to resell, distribute, advertise, and market Company’s products related to the citrus industry in Israel and other territories,<br>as well as additional products as shall be mutually agreed upon in the future. In addition, the Company agreed to grant Safe-Pack<br>a right of first refusal to be designated as an exclusive distributor of the Company in certain agreed upon territory for<br>additional products of the Company as they relate to the field of post-harvest. In consideration for the above rights granted<br>to Safe-Pack, Safe-Pack will submit to the Company purchase orders of its products at a price specified in the Distribution<br>Agreement. Commencing upon the second calendar year of the agreement, Safe-Pack is required to meet a minimum purchase quota,<br>as shall be mutually agreed upon between the parties. In the event that the parties fail to agree on a quota, the quota shall<br>be equal to last year quota plus 3%.

NOTE 7 – INVESTMENT IN SAVECANN SOLUTIONS INC

On April 2, 2019, the Company invested 10,000 Canadian Dollars for 20% of the outstanding shares of Savecann Solutions Inc. (“Savescann”) a newly formed company registered in Canada. Savecann intended to market the Company’s solutions to the Cannabis market.

On April 21, 2020, the Company sold its entire holdings in Savecann for total consideration of 10,000 Canadian Dollars.

18

SAVE FOODS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 8 – RELATED PARTIES

A.	Transactions<br>and balances with related parties
		Nine<br>months ended<br><br>September<br>30
---	---	---	---	---	---	---	---	---
		2020				2019

General<br>and administrative expenses:
Directors’<br>compensation (*)			311,848				170,444
Salaries<br>and fees to officers (*)			238,128				119,799
			561,148				290,243
(*)<br>share based compensation			309,640				122,049

Research<br>and development expenses:
Salaries<br>and fees to officers			25,272				86,964
	B.	Balances<br>with related parties and officers:
---	---	---
		As<br>of September 30,
---	---	---	---	---	---	---	---	---
		2020				2019

Other<br>accounts payables			295,413				156,082

NOTE 9 – SUBSEQUENT EVENTS

	1.	During<br>October 2020, the Company entered into a series of additional convertible loan agreements as detailed in Note 3B above,<br>with certain lenders to sell convertible promissory notes with an aggregate principal amount of $75,000.

	2.	On<br>October 12, 2020, certain of the Company’s stockholders representing more than 50% of the Company’s outstanding<br>share capital (the “Majority Consenting Stockholders”) approved an amendment to the Company’s Certificate<br>of Incorporation (the “Reverse Stock Split Certificate of Amendment”) in order to effect a reverse stock split<br>of the Company’s Common Stock pursuant to a range of between 5-to-1 and 7-to-1 (the “Reverse Stock Split”).<br>Pursuant to the Reverse Stock Split, each five or seven shares of Common Stock, as shall be determined by the Board at a later<br>time, will be automatically converted, without any further action by the stockholders, into one share of Common Stock. No<br>fractional shares of Common Stock will be issued as the result of the Reverse Stock Split. Instead, each stockholder of the<br>Company will be entitled to receive one share of Common Stock in lieu of the fractional share that would have resulted from<br>the Reverse Stock Split. The Reverse Stock Split Certificate of Amendment will be effective upon receipt of approval from<br>the Financial Industry Regulatory Authority (“FINRA”) and the filing with the Secretary of the State of Delaware,<br>which both were not completed as of the date of the filing of these financial statements.

	3.	Additionally,<br>on October 12, 2020, the Majority Consenting Stockholders approved an additional amendment to the Company’s Certificate<br>of Incorporation (the “Staggered Board Certificate of Amendment”) in order to affect the implementation<br>of a staggered board structure. The Staggered Board Certificate of Amendment will be effective upon the filing with the Secretary<br>of the State of Delaware, which was not filed as of the date of the filing of these financial statements.

	4.	On<br>November 5, 2020, the board of directors of the Company appointed Mr. David Palach, to<br>serve as co-Chief Executive Officer of the Company, effective as of the same date.

		In<br>connection with Mr. Palach’s appointment, the parties entered into a Consulting<br>Agreement pursuant to which the Company and Mr. Palach agreed upon, inter alia, the following<br>engagement terms: (a) a monthly retainer of $8,000, and (b) a grant of options to purchase<br>shares of the Company’s common stock, which amount shall be determined by the Board<br>on a future date.
19
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Readers are advised to review the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and the consolidated financial statements and related notes thereto in our 2019 Annual Report. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. See “Cautionary Note Regarding Forward-Looking Statements”. You should review the “Risk Factors” section of our Annual Report for the fiscal year ended December 31, 2019 for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

We are an innovative company that develops eco-friendly “green” solutions for the food industry. Our solutions are developed to improve food safety and shelf life of fresh produce by controlling human and plant pathogens, thus ensuring safety and reducing its spoilage, which, in turn, reduces food loss and waste.

Our products are based on a proprietary blend of food acids which are combined with low concentration of an oxidizer. Our products are capable of cleaning, sanitizing and controlling pathogens that render produce unsafe for human consumption or which lead to certain forms of decay in fruit and vegetable. Our active ingredients do not leave any toxicological residues on the fresh produce we treat. By forming a temporary protective shield around the fresh produce we treat, we make it difficult for pathogens to develop and thereby provide long-lasting protection which also reduces cross-contamination.

Most conventional chemical pesticides (fungicides) which are currently used to protect fresh produce and reduce food waste are toxic, they remain on fruit peel and present health concerns, while also polluting the environment. Therefore, the use of these products is strictly regulated and their residue on food and on the environment must be carefully monitored. Our products on average reduce by 50% (and in some cases eliminate) the need for additional use of conventional fungicide in the post-harvest phase.

We have a unique opportunity to make a positive difference throughout the food value chain from field to fork. We target major markets that use conventional chemical pesticides (fungicides) and sanitizers, including the pre- and post-harvest market, the greenhouse market and the fresh-cut market, where our “green” products are used as alternatives for, or mixed with, conventional products. We also target the cannabis market, for which we believe there are limited available and authorized conventional chemical products that can be used, either because of (a) health and environmental concerns, or (b) microbial resistance that has reduced the efficacy of conventional chemical pesticides.

Since the onset of the COVID-19 pandemic, we have postpend some of our planned field tests and international travels. In addition, some of our employees are currently on a temporary leave without pay (furlough). We expect the significance of the COVID-19 pandemic, including the extent of its effect on our financial and operational results, to be dictated by, among other things, its duration, the success of efforts to contain it and the impact of actions taken in response. While we are not able at this time to estimate the future impact of the COVID-19 pandemic on our financial and operational results, it could be material.

Critical Accounting Policies

Please see Note 2 of this Quarterly Report on Form 10-Q for the summary of significant accounting policies. Management’s Discussion and Analysis of Financial Condition and Results of Operation of our 2019 Annual Report with respect to our Critical Accounting Policies and Estimates. There have been no other material changes to our critical accounting policies and estimates since our 2019 Annual Report.

Going Concern Uncertainty

The development and commercialization of our product will require substantial expenditures. We have not yet generated any material revenues and have incurred substantial accumulated deficit and negative operating cash flows. We currently have no sources of recurring revenue and are therefore dependent upon external sources for financing our operations. There can be no assurance that we will succeed in obtaining the necessary financing to continue our operations. As a result, our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

20

Results of Operations

Comparison of the three months ended September 30, 2020 and 2019

Revenues and cost of revenues.

We had no revenues and cost of revenues for the three months ended September 30, 2020, or for the three months ended September 30, 2019.

We do not have backlogs or firm commitments from our clients for our products. Our sales might deteriorate if we fail to achieve commercial success or obtain regulatory approval of any of our products.

Research and Development

Research and development expenses consist of salaries and related expenses, consulting fees, service providers’ costs, related materials and overhead expenses. Research and development expenses for the three months ended September 30, 2020 were $87,465, a decrease of $64,939, or 43%, compared to total research and development expenses of $152,404 for the three months ended September 30, 2019. The decrease is mainly attributable to: (1) the decrease in professional fees, share based compensation and in payroll; and (2) the decrease in expenses associated with international travel and field trials which have been postponed due to COVID-19.

Selling and Marketing Expenses

Selling and marketing expenses consist primarily of salaries and related costs for sales and marketing personnel, travel related expenses and services providers. Selling and marketing expenses for the three months ended September 30, 2020 were $6,734, a decrease of $113,715, or 94%, compared to total selling and marketing expenses of $120,449 for the three months ended September 30, 2019. The decrease is mainly attributable to the decrease in payroll expenses and service providers used in relation to selling and marketing activities mainly associated with the termination of the employment of our Vice President of Sales in February 2020.

General and Administrative Expenses

General and administrative expenses consist primarily of salaries and related expenses including share based compensation and other non-personnel related expenses such as legal expenses and directors and insurance costs. General and administrative expenses for the three months ended September 30, 2020 were $337,886, an increase of $106,008, or 45%, compared to total general and administrative expenses of $231,878 for the three months ended September 30, 2019. The increase is mainly a result of the increase in share based compensation to our service providers and directors offset partially by a decrease in professional fees.

Financing Expenses, Net

Financing income, net for the three months ended September 30, 2020 was $6,478 compared to total financing income, net of $9,805 for the three months ended September 30, 2019.

Comparison of the nine months ended September 30, 2020 and 2019

Revenues

Revenues for the nine months ended September 30, 2020 were $63,566, a decrease of $66,167, or 51%, compared to total revenues of $129,733 for the nine months ended September 30, 2019. The decrease is mainly a result of the Company’s freeze in sales in Israel and the reduction in sales in the United States and focus on obtaining regulatory approval for the marketing and sale of its new products.

21

Cost of Revenues

Cost of revenues consists primarily of salaries, purchasing of materials, transportation and overhead costs of manufacturing our products. Cost of revenues for the nine months ended September 30, 2020 was $25,686, a decrease of $73,349, or 74%, compared to total cost of revenues of $99,035 for the nine months ended September 30, 2019. The decrease is mainly a result of the decrease in salaries and related expenses.

Research and Development

Research and development expenses consist of salaries and related expenses, consulting fees, service providers’ costs, related materials and overhead expenses. Research and development expenses for the nine months ended September 30, 2020 were $340,808, a decrease of $30,599, or 8%, compared to total research and development expenses of $371,407 for the nine months ended September 30, 2019. The decrease is mainly attributable to: (1) the decrease in professional fees, share based compensation and in payroll; and (2) the decrease in expenses associated with international travel and field trials which have been postponed due to COVID-19.

Selling and Marketing Expenses

Selling and marketing expenses consist primarily of salaries and related costs for sales and marketing personnel, travel related expenses and services providers. Selling and marketing expenses for the nine months ended September 30, 2020 were $43,482, a decrease of $335,128, or 88%, compared to total selling and marketing expenses of $378,610 for the nine months ended September 30, 2019. The decrease is mainly attributable to the decrease in payroll expenses and service providers used in relation to selling and marketing activities mainly associated with the termination of the employment of our Vice President of Sales in February 2020.

General and Administrative Expenses

General and administrative expenses consist primarily of salaries and related expenses including share based compensation and other non-personnel related expenses such as legal expenses and directors and insurance costs. General and administrative expenses for the nine months ended September 30, 2020 were $851,262, an increase of $191,633, or 29%, compared to total general and administrative expenses of $659,629 for the nine months ended September 30, 2019. The increase is mainly a result of the increase in share-based compensation to our service providers and directors offset partially by a decrease in professional fees.

Financing Expenses, Net

Financing expenses, net for the nine months ended September 30, 2020 was $206,829, a decrease of $175,706, or 564%, compared to total financing expenses of $31,123 for the nine months ended September 30, 2019. The increase is mainly a result of compensation expenses related to the exchange of our Convertible Loans as described in Note 3A to the financial statements as well as accrued interest and amortization expenses related to the Convertible Loans.

Liquidity and Capital Resources

Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. Significant factors in the management of liquidity are funds generated by operations, levels of accounts receivable and accounts payable and capital expenditures.

As of September 30, 2020, we had $310,571 in cash, as compared to $290,815 as of December 31, 2019. As of September 30, 2020, we had a negative working capital of $309,931, as compared to negative working capital of $199,212 as of December 31, 2019. The increase in our cash balance is mainly attributable to equity financing less our net loss, as described above, which is offset by share based compensation expenses and other non-cash expenses.

Net cash used in operating activities was $619,397 for the nine months ended September 30, 2020, as compared to $879,780 for the nine months ended September 30, 2019.

Net cash used for investing activities was $1,809 for the nine months ended September 30, 2020, as compared to $61,065 for the nine months ended September 30, 2019.

Net cash provided by financing activities was $637,344 for the nine months ended September 30, 2020, as compared to $800,466 for the nine months ended September 30, 2019. The decrease is mainly the result of a decrease in equity financing and proceeds from convertible loans.

On June 24, 2020, the Company entered into a Securities Purchase Agreement (the “June 2020 SPA”) with the Lenders in connection with the sale and issuance of 485,318 units, at a purchase price of $1.09 per unit. Each unit consists of: (i) one share of the Company’s Common Stock; and (ii) one warrant to purchase one share of Common Stock with an exercise price of $1.20. In connection with the June 2020 SPA, the Company issued to the Lenders an aggregate of 485,318 shares of Common Stock and warrants to purchase an aggregate of 485,318 shares of Common Stock. The shares of Common Stock were issued on July 2, 2020.

During July 2020, the Company entered into Securities Purchase Agreements with existing shareholders (the “Investors”), pursuant to which the Company sold to the Investors for an aggregate amount of $75,000, 68,808 units at a price per unit of $1.09, each unit consists of (i) one share of common stock of the Company and (ii) one warrant to purchase one share of Company’s common stock with an exercise price of $1.20 for a period of 36 months following the issuance date.

On September 23, 2020, the Company entered into a Securities Purchase Agreement (the “September 2020 SPA”) with Medigus Ltd. (“Medigus”) in connection with the sale and issuance of 91,743 units, at a purchase price of $1.09 per unit, and for an aggregate purchase price of $100,000. Each unit consists of: (i) one share of Common Stock and (ii) one warrant to purchase one share of Common Stock with an exercise price of $1.20. In connection with the September 2020 SPA, the Company issued to Medigus an aggregate of 91,743 shares of Common Stock and warrants to purchase an aggregate of 91,743 shares of Common Stock. Furthermore, the September 2020 SPA contemplates an additional investment by Medigus not to exceed $25,000 (the “Additional Investment”), which investment shall be triggered following the parties’ initiation of a proof of concept procedure to test the effectiveness of the Company’s sanitizers and its residual effects against different pathogens. In consideration for the Additional Investment, the Company has agreed to issue an additional 22,935 units at a purchase price of $1.09, which units shall contain the same composition of securities as described in the foregoing description of the September 2020 SPA.

On September 24, 2020, the Company entered into a series of convertible loan agreements (each a “September 2020 CLA”) with certain lenders to sell convertible promissory notes with an aggregate principal amount of $125,000. The outstanding loan amount will mature on the earlier of (i) the third anniversary of each September 2020 CLA or (ii) a deemed liquidation event (as defined therein), and the lenders may convert all or any portion of the notes into shares of the Company’s Common Stock at any time prior to a mandatory conversion event (as defined therein) at a conversion price of $1.09 per share. The notes will bear interest at a rate of 5% per annum. The loan amount represented by the notes will be repaid to the lenders according to the following schedule: (i) the principal amount represented by the notes will be repaid in four (4) bi-annual installments, commencing on the first anniversary following the closing of each September 2020 CLA, and (ii) the interest accrued on the loan amount will be paid in two (2) bi-annual installments, commencing on the first anniversary of the first payment of that principal amount.

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The spread of COVID-19 throughout the world may result in a period of business and manufacturing disruption, and in reduced operations, any of which could materially affect our business, financial condition and results of operations especially regarding its ability to obtain the necessary finance to continue the Company’s operations. The extent to which COVID-19 impacts the Company’s business will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. Since the onset of the COVID-19 pandemic, we have postpend some of our planned field tests and international travels. In addition, some of our employees are currently on a temporary leave without pay (furlough).

Off-Balance Sheet Arrangements

As of September 30, 2020, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Our management, including our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of September 30, 2020, the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, and due to certain material weaknesses identified by management, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective at a reasonable assurance level as of September 30, 2020.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting or in other factors identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the period covered by this Quarterly Report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting**.**

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PART II- OTHER INFORMATION

ITEM 1A. RISK FACTORS.

Our business faces many risks, a number of which are described under the caption “Risk Factors” in our 2019 Annual Report. Other than as set forth below, there have been no material changes from the risk factors previously disclosed in our 2019 Annual Report. The risks described in the 2019 Annual Report and below may not be the only risks we face. Other risks of which we are not yet aware, or that we currently believe are not material, may also materially and adversely impact our business operations or financial results. If any of the events or circumstances described in the risk factors contained in the 2019 Annual Report or described below occurs, our business, financial condition or results of operations could be adversely impacted and the value of an investment in our securities could decline. Investors and prospective investors should consider the risks described in the 2019 Annual Report and below, and the information contained under the caption “Forward-Looking Statements” and elsewhere in this Quarterly Report on Form 10-Q before deciding whether to invest in our securities.

The COVID-19 pandemic, or any other pandemic, epidemic or outbreak of an infectious disease, may materially and adversely affect our business and operations.

The outbreak of COVID-19, which originated in Wuhan, China, in late 2019, has since spread across the globe, including the United States, Israel and many European countries in which we operate. On March 11, 2020, the World Health Organization declared the outbreak a pandemic. While COVID-19 is still spreading and the final implications of the pandemic are difficult to estimate at this stage, it is clear that it has affected the lives of a large portion of the global population. At this time, the pandemic has caused states of emergency to be declared in various countries, travel restrictions imposed globally, quarantines established in certain jurisdictions and various institutions and companies being closed. We are actively monitoring the pandemic and we are taking any necessary measures to respond to the situation in cooperation with the various stakeholders.

Based on guidelines provided by the Israeli Government, employers (including us) are also required to prepare and increase as much as possible the capacity and arrangement for employees to work remotely. In that regard, and in compliance with all applicable Israeli rules and guidelines, our offices have remained closed since the middle of March 2020, and all of our employees currently work remotely. In addition, COVID-19 infection of our workforce could result in a temporary disruption in our business activities, including manufacturing, and other functions.

The spread of an infectious disease, including COVID-19, may also result in the inability of our manufacturers to deliver components or finished products on a timely basis and may also result in the inability of our suppliers to deliver the parts required by our manufacturers to complete manufacturing of components or finished products. In addition, governments may divert spending from other budgeted resources as they seek to reduce and/or stop the spread of an infectious disease, such as COVID-19. Such events may result in a period of business and manufacturing disruption, and in reduced operations, any of which could materially affect our business, financial condition and results of operations. The extent to which COVID-19 impacts our business will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others.

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ITEM 6. EXHIBITS.

(a) The following documents are filed as exhibits to this Quarterly Report or incorporated by reference herein.

Exhibit<br><br>Number		Description

10.1*		Securities Purchase Agreement by and between Save Foods, Inc. and Medigus Ltd., dated September 23, 2020
31.1*		Certification<br>of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act

31.2*		Certification<br>of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act

32.1**		Certification<br>of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley<br>Act of 2002

32.2**		Certification<br>of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley<br>Act of 2002

101.INS		XBRL<br>Instance Document

101.INS		XBRL<br>Taxonomy Extension Schema Document

101.CAL		XBRL<br>Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL<br>Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL<br>Taxonomy Extension Label Linkbase Document

101.PRE		XBRL<br>Taxonomy Extension Presentation Linkbase Document

*		Filed<br>herewith.

**		Furnished<br>herewith.
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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:<br>November 12, 2020	SAVE<br>FOODS INC.

	By:	/s/<br>Dan Sztybel
	Name:	Dan<br>Sztybel
	Title:	Chief<br>Executive Officer
		Save<br>Foods, Inc.

	By:	/s/<br>Shlomo Zakai
	Name:	Shlomo<br>Zakai
	Title:	Chief<br>Financial Officer
		Save<br>Foods, Inc.
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Exhibit 10.1

SECURITIES PURCHASE AGREEMENT

THIS SECURITIES PURCHASE AGREEMENT (the “Agreement”) is made as of September 23, 2020, by and among Save Foods, Inc., a Delaware corporation (the “Company”) and Medigus Ltd., a company organized under the laws of the state of Israel (the “Investor”).

WHEREAS, the Company desires to issue and sell to the Investor, and the Investor desire to purchase from the Company, upon the terms and conditions stated in this Agreement, for an aggregate purchase price of up to US$100,000 (the “Purchase Price”), in consideration for 91,743 units at a price of $1.09, each consists of (i) one share of common stock, par value $0.0001 of the Company (the “Common Stock” and “Purchased Shares”, respectively); and (ii) one warrant to purchase one share of Common Stock with an exercise price of $1.20, in the form attached hereto as Exhibit A (collectively the “Warrant”, and together with the Purchased Shares, the “Initial Purchased Securities”), all under and subject to the terms and conditions set forth in the Warrant; and

WHEREAS, the Investor and the Company agree that the Investor shall invest up to additional US$25,000 in excess of the Purchase Price (the “POC Investment Amount”), which will be conditioned upon the mutual agreement of the Company and the Investor to jointly perform a proof of concept procedure to test the effectiveness of the Company’s sanitizers and its residual effects against different pathogens including a COVID-19 virus’ surrogate, based on agreed terms of study, its scope and cost (the “POC Condition”), with such POC Investment Amount to be allocated specifically to such purpose, in consideration for up to 22,935 units at a price of $1.09, each consisting of (i) one share of Common Stock (the “Additional Purchased Shares”); and (ii) one Warrant, all under and subject to the terms and conditions set forth in the Warrant (together with the Additional Purchased Shares, the “Additional Purchased Securities”) (the Initial Purchased Securities together with the Additional Purchased Securities, the “Purchased Securities”).

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

PURCHASE AND SALE OF SECURITIES.

1.1 Sale and Issuance of Securities. Subject to the satisfaction of certain closing conditions set forth in Sections 4 and 5 hereof at the Closing (as defined below), the Company shall issue and sell to the Investor, and the Investor shall purchase from the Company the Initial Purchased Securities and subject to the satisfaction of the POC Condition, the Investor shall purchase from the Company the Additional Purchased Securities.

The capitalization table of the Company, reflecting the issued and outstanding share capital of the Company on a Fully Diluted Basis, immediately prior to Closing and immediately following the Closing, assuming the investment of the Purchase Price) and reflecting the issuance of the Purchased Securities is attached hereto as Exhibit B (the “Capitalization Table”).

1.2 Closing. The consummation of the transactions contemplated hereby, including the purchase and sale of the Purchased Securities (the “Closing”) shall take place remotely via the exchange of documents and signatures, on September 23, 2020, or at such other time and place as the Company and the Investor mutually agree upon (such designated time and place, the “Closing Date”). The Closing shall be subject to the conditions of Section 4 and 5 below, which conditions shall be deemed to take place simultaneously and no transaction described in such sections shall be deemed to have been completed or any document delivered until all such transactions have been completed and all such required documents delivered.

1.3 Closing Deliverables.

At the Closing, the Company shall deliver to the Investor:

(i) True and correct copies of written resolutions, or minutes of a meeting, of the board of directors of the Company, approving and adopting in all respects the execution, delivery and performance by the Company of this Agreement and the transactions contemplated hereby, including, among others, (i) authorizing the issuance and sale of the Purchased Securities against payment of the Purchase Price therefor and the grant of the Warrant and the issuance of the stock underlying such Warrant, as applicable, upon the exercise of such Warrant; (ii) reserving a sufficient number of shares of Common Stock to be issued upon the exercise of the Warrant issuable under this Agreement;

(ii) Book-entry confirmation representing respective Purchased Shares issued to the Investor at the Closing in the name of the Investor.

(iii) The Warrant, duly executed by the Company issued to the Investor at the Closing in the name of such Investor, all under and subject to the terms and conditions set forth in the Warrant, in the form attached hereto as Exhibit A; and

(iv) A certificate duly executed by an executive officer of the Company as of the Closing stating that the conditions specified in Section 4 have been satisfied, in the form attached hereto as Schedule ‎1.3(iii).

1.4 Purchase Price. Upon the Closing, the Investor shall transfer to the Company the Purchase Price by wire transfer of immediately available funds according to the wire instructions attached hereto as Schedule 1.4.

1.5 Additional Closing. Within three (3) days following the satisfaction of the POC Condition, the Company shall sell and issue, on the same terms and conditions as those contained in this Agreement, at an additional closing (the “Additional Closing”) the Additional Purchased Securities. Upon the Additional Closing, this Agreement shall automatically be deemed to be updated to reflect the POC Investment Amount and the number of Additional Units purchased by the Investor at the Additional Closing. Thereafter, for all purposes under this Agreement, the “Additional Purchased Securities” shall be deemed to be “Purchased Securities” and the POC Investment Amount for the Additional Purchased Securities shall be deemed to be part of the “Purchase Price”. At the Additional Closing, following the Company’s receipt of the Investor’s wire transfer of the POC Investment Amount, the Company shall deliver to Investor a book-entry confirmation representing respective Additional Purchased Shares issued to the Investor at the Additional Closing in the name of the Investor.

REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company hereby represents and warrants to the Investor that, the following representations are true, correct and complete as of the date hereof and as of the Closing (as if made on the Closing Date); except, in each case, as to such representations and warranties that address matters as of a particular date, which are true, correct and complete only as of such date.

In this Agreement, “Material Adverse Effect” means a material and adverse effect on the assets, properties, conditions (financial or otherwise), operating results or business of the Company.

2.1 Subsidiary. The Company wholly-owns Save Foods Ltd., an Israeli company (the “Subsidiary”), and as of the date of the Agreement, the Subsidiary is the only subsidiary of the Company. The Company owns directly all of the capital stock or other equity interests of the Subsidiary free and clear of any lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction, and all of the issued and outstanding share capital of the Subsidiary is validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.

2.2 Organization. With the exception of the Subsidiary’s current “breaching status” with the Israeli Registrar of Companies, the Company and the Subsidiary are each an entity duly incorporated or otherwise organized, validly existing and in good standing (if applicable in such jurisdiction) under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor the Subsidiary is in violation nor default of any of the provisions of its respective certificate of incorporation, bylaws or other organizational or charter documents. Each of the Company and the Subsidiary is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in: (i) a Material Adverse Effect on the legality, validity or enforceability of any Transaction Document, (ii) a Material Adverse Effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiary, taken as a whole, or (iii) a Material Adverse Effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction Document and no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.

2.3 Capitalization.

(a) The authorized share capital of the Company will be on or immediately following to the Closing, as set forth in the Company’s Certificate of Incorporation (the “COI”), and such number of Common Stock as set forth in the Capitalization Table are or shall be (immediately following the Closing) issued and outstanding, which shall reflect as of the date hereof, he number of shares of Common Stock issued to Investor pursuant to the Agreement.

(b) The issued and outstanding shares of the Company were duly and validly authorized and issued, fully paid and non-assessable, and offered and issued in compliance with the provisions of the COI as in effect at the time of each such issuance and in compliance with all applicable corporate and securities laws.

(c) Immediately prior to the Closing, no shares, options, warrants, rights (including conversion, preemptive rights, rights of first refusal or similar rights) or agreements for the purchase from the Company of any of its stock capital, or any securities convertible into or exchangeable for stock of the Company shall be outstanding.

(d) Immediately prior to the Closing, no option, security or other equity award convertible or exercisable into stock of the Company shall contain a provision for acceleration of vesting (or lapse of a repurchase right) or other changes in the vesting provisions or other terms of such option.

(e) The Company has not declared or paid any dividends, or authorized or made any distribution upon or with respect to any class or series of its stock capital.

2.4 Authorization. All corporate action on the part of the Company, its directors and shareholders, necessary for the authorization, execution and delivery of this Agreement and the other agreements, instruments or documents entered into in connection with this Agreement and to which the Company is a party (collectively, the “Transaction Documents”) and for the performance of all obligations of the Company under the Transaction Documents in accordance with their terms has been taken or will be taken prior to the Closing and the Additional Closing, as applicable. The Transaction Documents, when executed and delivered by the Company, and assuming the due authorization, execution and delivery by the other parties hereto and thereto, constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other laws of general application relating to or affecting the enforcement of creditors’ rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

2.5 Valid Issuance. The Purchased Securities being or that may be issued to the Investor hereunder, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration expressed herein, shall be duly and validly issued, fully paid, and non-assessable, issued in compliance with all applicable state securities laws, and free and clear of liens, pledges, charges, encumbrances or other restrictions on transfer of any kind (including, without limitation, preemptive rights), other than restrictions on transfer under this Agreement, the COI, the Company’s currently effective Bylaws (the “Bylaws”) and under applicable securities laws and other than liens or encumbrances created by or imposed on the Investor as to itself. The rights, privileges and preferences of the Purchased Securities are as stated in the COI and Bylaws, as may be amended from time to time in accordance with its terms.

2.6 No Conflict; Consents. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party, the issuance and sale of the Purchased Securities and the consummation by it of the transactions contemplated hereby and thereby do not and will not: (i) conflict with or violate any provision of the COI or Bylaws or other organizational or charter documents, (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction, upon any of the properties or assets of the Company, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company debt or otherwise) or other understanding to which the Company is a party or by which any property or asset of the Company is bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to result in a Material Adverse Effect.

2.7 SEC Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act”) since the Company’s registration statement on Form 10 was determined effective (collectively, the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The financial statements of the Company included in the SEC Reports (the “Financial Statements”) comply in all material respects with applicable accounting requirements and the rules and regulations of the U.S. Securities and Exchange Commission (the “Commission”) with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the U.S. (“US GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by US GAAP, and fairly present in all material respects the financial position of the Company as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.

2.8 Material Changes. Since June 30, 2020, there has been no event, occurrence or development that has had or that would reasonably be expected to result in a Material Adverse Effect.

2.9 Continued Quotation. The Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such quotation and maintenance requirements of the “Pink Sheets” published and maintained by OTC Markets Group, Inc., and shall make commercial best efforts to maintain such compliance.

2.10 Financial Statements; No Undisclosed Liabilities.

(a) Except as set forth in the Financial Statements, the Company has no liabilities or obligations, contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business, subsequent to June 30, 2020, which, individually and in the aggregate, do not exceed US$100,000; (ii) obligations under contracts and commitments incurred in the ordinary course of business including debt of the Subsidiary to the Company in the principal amount of US$100,000; (iii) liabilities and obligations of a type or nature not required under GAAP to be reflected in the Financial Statements, which, individually and in the aggregate do not exceed US$100,000;

(b) The Company is not a guarantor or indemnitor of any debt or obligation of another, nor has the Company given any loan, security or otherwise agreed to become liable for any obligation of any person. No person has given any guarantee of, or security for, any obligation of the Company. The Company did not extend any loans or advances to any person, other than advances for expenses to its employees in the ordinary course of business.

2.11 Assets and Properties. Both the Company and the Subsidiary have good and marketable title to all of the tangible or personal properties and assets owned by the Company and the Subsidiary, which are material to the business of the Company or the Subsidiary as currently conducted, and such properties and assets are free and clear of all mortgages, deeds of trust, liens, pledges, charges, security interests, conditional sale agreement, loans and encumbrances, except for statutory liens for the payment of current taxes that are not yet delinquent and encumbrances and liens that arise in the ordinary course of business and do not materially impair the Company’s or the Subsidiary’s ownership or use of such property or assets. With respect to the tangible property and assets it leases, the Company and the Subsidiary are in compliance in all material respects with such leases and, to its knowledge, holds a valid leasehold or license interest free of any liens, pledges, charges, security interest, claims or encumbrances, other than those of the lessors of such property or assets. The Company and the Subsidiary do not own any real property.

2.12 Intellectual Property. The Company and the Subsidiary have, or have rights to use, all patents, patent applications, trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights for use in connection with their respective businesses and which the failure to so have could have a Material Adverse Effect (collectively, the “Intellectual Property Rights”). Neither the Company nor the Subsidiary have received a notice (written or otherwise) that any of, the material Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date of this Agreement. Neither the Company nor the Subsidiary have received, since January 1, 2019, a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe (and will not infringe) upon the rights of any Person, except as could not have or reasonably be expected to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights. The Company and the Subsidiary have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company has no knowledge of any facts that would preclude it or the Subsidiary from having valid license rights or clear title to the Intellectual Property Rights. The Company has no knowledge that either it or the Subsidiary lacks or will be unable to obtain any rights or licenses to use all Intellectual Property Rights that are necessary to conduct its business. For purposes of this Section, “knowledge”, including the phrase “to the Company’s knowledge” (or similar phrases), when used in this Section 2.11 (Intellectual Property) shall mean the actual knowledge of the Company, without conducting any patent search, freedom to operate, infringement, or any similar search.

2.13 Labor Matters.

(a) The Company and the Subsidiary have complied, in all material respects, with all applicable employment laws, policies, procedures and agreements relating to employment, and terms and conditions of employment. The Company and the Subsidiary have paid in full to all of its respective employees and consultants all wages, salaries, commissions, bonuses, benefits and other compensation due and payable to such employees or consultants on or prior to the date of this Agreement. The Company and the Subsidiary have complied in all material respects with the applicable laws relating to the proper withholding and remittance to the proper tax and other authorities of all sums required to be withheld from employees or persons deemed to be employees under applicable laws. To the Company’s knowledge, all persons classified by the Company or the Subsidiary as consultants or contractors thereof are correctly classified as such and not as employees for any purpose. The Company’s and the Subsidiary’s liability for any obligations to pay any amount of severance payment, pension, accrued vacation, and other social benefits and contributions, under applicable law or contract, or any other payment of substantially the same nature, is fully funded by deposit of funds in severance funds, pension funds, managers insurance policies or provident funds (and if not required to be so funded) adequate provisions have been made in the Company’s Financial Statements.

(b) Neither the Company nor the Subsidiary is a party to, bound by or subject to, and no employee of the Company or the Subsidiary benefits from, any collective bargaining agreement, collective labor agreement, extension orders (tzavei harchava) (other than extension orders that apply to all employees in Israel generally), or other contract or arrangement with a labor union, trade union or other organization or body, to provide benefits or working conditions beyond the minimum benefits and working conditions required by applicable law. No labor union has requested or has sought to represent any of the employees, representatives or agents of the Company or the Subsidiary, nor is the Company or the Subsidiary aware of any labor organization activity involving its employees. There is no strike or other labor dispute involving the Company or the Subsidiary pending or, to the Company’s knowledge, threatened.

2.14 Taxes. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect, the Company and the Subsidiary each (i) has made or filed all United States federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply. Except as disclosed in SEC Reports, there are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and neither the officers of the Company nor the Subsidiary know of no basis for any such claim.

2.15 Governmental Grants. Neither the Company nor the Subsidiary have applied, obtained or received any grant, loan, incentives, benefits (including tax benefits), subsidies or other assistance from any governmental or regulatory authority or any agency, or any international or bilateral fund, institute or organization or public entities or authorities.

2.16 Litigation. There is no claim, action, suit, proceeding, arbitration, complaint, charge or, to the Company’s knowledge, investigation pending, or, to the Company’s knowledge, currently threatened in writing against the Company or the Subsidiary, any of its properties, or any officer, director or employee of the Company or the Subsidiary, including, without limitation, arising out of their employment or board relationship with the Company or the Subsidiary or in their capacity as such, or that questions the validity of the Transaction Documents or the right of the Company to enter into them, or to consummate the transactions contemplated by the Transaction Documents.

2.17 Insurance. The Company and the Subsidiary are covered by insurance with respect to its properties and business.

2.18 Compliance. Neither the Company nor the Subsidiary (i) is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or the Subsidiary under), nor has the Company or the Subsidiary received written notice of a claim that it is in default under, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any order of any court, arbitrator or governmental body, or (iii) is in violation of any law, rule or regulation of any governmental authority, except in each case as would not have a Material Adverse Effect.

2.19 Permits. The Company and the Subsidiary possess all licenses, certificates, permits and other authorizations issued by all applicable authorities necessary to conduct their respective businesses, and neither the Company nor the Subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a Material Adverse Effect.

2.20 Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by the Company or the Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by this Agreement.

2.21 Disclosure. No representation or warranty of the Company contained in this Agreement, and no certificate furnished or to be furnished to Investor at the Closing or the Deferred Closing contains any untrue statement of a material fact or, to the Company’s knowledge, omits to state a material fact necessary in order to make the statements contained herein or therein not misleading in light of the circumstances under which they were made.

REPRESENTATIONS AND WARRANTIES OF THE INVESTOR.

The Investor hereby represents and warrants, with respect to itself only, that the following representations are true, correct and complete as of the date hereof and as of the Closing (as if made on the Closing Date); except, in each case, as to such representations and warranties that address matters as of a particular date, which are given only as of such date:

3.1 Authorization; Organization. The Investor is duly organized, validly existing and, if applicable, in good standing under the laws of the jurisdiction in which it has been incorporated and has full power and authority to enter into the Transaction Documents. The Transaction Documents to which the Investor is a party, when executed and delivered by the Investor, and assuming the due authorization, execution and delivery by the other parties hereto and thereto, constitute valid and binding obligations of the Investor, enforceable against the Investor in accordance with their respective terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other laws of general application relating to or affecting the enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies, and (iii) to the extent the indemnification provisions contained herein, as may be limited by applicable securities laws.

3.2 No Conflict; Consents. The execution, delivery and performance by the Investor of the Transaction Documents to which it is a party and the consummation of the transactions contemplated by such Transaction Documents do not and will not (a) result in any conflict with, or a breach or violation, with or without the passage of time and giving of notice, of any of the terms, conditions or provisions of, or give rise to rights to others (including rights of termination, cancellation or acceleration) under: (i) the governing documents of the Investor; (ii) any judgment, injunction, order, writ, decree or ruling of any court or governmental authority, domestic or foreign, to which the Investor is subject; (iii) any material contract or agreement, lease, license or commitment to which the Investor is a party or by which it is bound; (iv) any applicable law; or (b) require the consent, approval or authorization of, registration, qualification or filing with, or notice to any person or any federal, state, local or foreign governmental authority or regulatory authority or agency, on the part of the Investor, which has not heretofore been obtained or made or will be obtained or made prior to Closing or the Deferred Closing, as applicable.

3.3 Purchase Entirely for Own Account. The Purchased Securities will be acquired for investment for the Investor’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and the Investor has no present intention of selling, granting any participation in, or otherwise distributing the same. The Investor does not presently have any contract, undertaking, agreement or arrangement to sell, transfer or grant participation rights to any person with respect to any of the Purchased Securities. The Investor has not been formed for the specific purpose of acquiring the Purchased Securities.

3.4 Disclosure of Information. The Investor has had an opportunity to discuss the Company’s business, operations, properties, prospects, technology, plans, management, financial affairs and the terms and conditions of the offering of the Purchased Securities with the Company’s management and has had an opportunity to review the Company’s facilities. The foregoing, however, does not limit, modify or qualify the representations and warranties of the Company in Section ‎2 of this Agreement or the right of the Investor to rely thereon. The Investor acknowledges that any projections provided (if any) by the Company are uncertain in nature, and that some or all of the assumptions underlying such projections may not materialize or will vary significantly from actual results.

3.5 Investment Experience; Accredited Investor; Non-U.S. Person. The Investor acknowledges that it is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial or business matters that it is capable of evaluating and understanding the merits and risks of the investment in the Purchased Securities. The Investor is either (i) an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”), or (ii) a Non U.S. Person as defined under Regulation S promulgated under the Securities Act. To the extent that the Investor is a non U.S. Person, such Investor (x) is not acquiring Purchased Securities for the account or benefit of any U.S. Person, (y) is not, at the time of execution of this Agreement, and will not be, at the time of the Closing or Additional Closing, in the United States and (z) is not a “distributor” (as defined in Regulation S promulgated under the Securities Act).

3.6 Restricted Securities. The Purchased Securities have not been and will not be registered under the Securities Act or any state securities laws and, therefore, cannot be resold unless they are registered under the Securities Act and applicable state securities laws or unless an exemption from such registration requirements is available. Investor is aware that, except as set forth herein, the Company is under no obligation to effect any such registration or to file for or comply with any exemption from registration. The sale and issuance of the Purchased Securities have not been registered under the Securities Act by reason of a specific exemption from registration which depends upon, among other things, the accuracy of the Investor’s representations as expressed herein.

3.7 Legends. The Purchased Securities, and (if applicable) any securities issued in respect of or exchange for the foregoing may be notated with the following or a similar legend as well as other legends as may be required by applicable securities laws: “THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO TRANSFER OF SUCH SHARES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.”

CONDITIONS OF INVESTOR’S OBLIGATIONS AT CLOSING.

The obligations of the Investor to purchase the Purchased Securities at the Closing are subject to the fulfillment on or before the Closing of each of the following conditions, unless otherwise waived in writing by the Investor:

4.1 Representations and Warranties. The representations and warranties of the Company in Section 2 of this Agreement shall have been true in all respects on and as if made as of the Closing.

4.2 Performance. The Company shall have performed and complied, in all respects, with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing.

4.3 Delivery of Documents. All of the documents to be delivered by the Company pursuant to Section 1.3, shall have been in a form as attached to this Agreement, or, if not attached, in a form and substance satisfactory to the Investor and shall have been delivered to the Investor.

4.4 Additional Investment. The Company consummated additional equity investment(s) for the Company’s Common Stock, in the aggregate amount of no less than US$200,000, not counting the Purchase Price.

CONDITIONS OF THE COMPANY’S OBLIGATIONS AT CLOSING.

The obligations of the Company to the Investor under this Agreement are subject to the fulfillment on or before the Closing, of each of the following conditions, unless otherwise waived in writing by the Company:

5.1 Representations and Warranties. The representations and warranties contained in Section ‎3 shall have been true in all respects on and as if made as of the Closing.

5.2 Performance. The Investor shall have performed and complied, in all respects, with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing.

AFFIRMATIVE COVENANTS BY THE COMPANY.

6.1 Use of Proceeds. The Company will use the Purchase Price for general working capital purposes. Notwithstanding the foregoing, the POC Investment Amount shall be allocated specifically to conducting a proof of concept procedure to test the effectiveness of the Company’s sanitizers and its residual effects against different pathogens including a COVID-19 virus’ surrogate.

6.2 Conduct of the Business between Signing and Closing. Except as otherwise expressly provided by this Agreement or with the prior written consent of each of the Investor individually (which consent shall not be unreasonably withheld or delayed), the Company shall (i) conduct its business in the ordinary course of business, consistent with prior practice; (ii) comply with legal requirements applicable to the operation of its business and pay applicable taxes as due; (iii) maintain its books, accounts and records in the ordinary course of business; and (iv) not take any other action that would result in a breach of any of the representations, warranties or covenants made by the Company in this Agreement or that would adversely affect its ability to consummate the transactions contemplated by this Agreement.

INDEMNIFICATION.

7.1 Effectiveness; Survival.

(a) The Investor has the right to fully rely upon all representations, warranties and covenants of the Company, for which the Company shall be held responsible (the “Indemnitor”) contained in or made pursuant to this Agreement and in the schedules attached hereto. Unless otherwise set forth in this Agreement, the representations and warranties of the Company contained in or made pursuant to this Agreement shall in no way be affected by any investigation or knowledge of the subject matter thereof made by or on behalf of the Investor.

(b) The representations and warranties of the Company contained in or made pursuant to this Agreement shall survive the execution and delivery of this Agreement and the Closing, until (1) in case of Section 2.11 (Intellectual Property), until the 30^th^ months anniversary of the Closing Date; (2) in case of Sections 2.2 (Organization), 2.4 (Authorization) and 2.6 (No Conflict; Consents), until the expiration of the applicable statute of limitation period; and (3) other than as set forth in clause (1) above, the 24^th^ months anniversary of the Closing Date; in each case, with respect to any theretofore un-asserted claims as set forth in clause (d) below;

(c) In respect to Section 7.1(b) above, no limitation shall apply to breach of any representation or warranty which constitutes fraud or willful misrepresentation by the Company (“Fraud”). The applicable survival period shall be referred to, as applicable, as the “Claims Period”.

(d) Except for Fraud, the Company shall have any liability with respect to any breach of representation and warranty, unless a claim is made hereunder prior to the expiration of the Claims Period for such representation and warranty, in which case such representation and warranty shall survive as to that claim until the claim has been finally resolved.

(e) It is the intention of the parties hereto that the Claims Periods supersede any statute of limitations applicable to the representations and warranties, and this Section ‎7.1 constitutes a separate written legally binding agreement among the parties hereto in accordance with the provisions of Section 19 of the Israeli Limitation Law, 1958.

7.2 Indemnification.

(a) Indemnifiable Losses. The Indemnitor shall indemnify the Investor (including its shareholders, limited and general partners directors and officers) (each, an “Indemnitee”) against, and hold each Indemnitee harmless from all claims, actions, suits, settlements, damages, expenses (including, reasonable legal costs and expenses), losses, or costs sustained or incurred by such Indemnitees (collectively, “Losses”) resulting from, or arising out of, a breach or misrepresentations of any the Indemnitor’s representations, warranties or covenants made in this Agreement, subject to the limitations in this Section ‎7.

(b) Limitations. The Indemnitee’s right for indemnification hereunder is subject to the following conditions and limitations, notwithstanding anything to the contrary in this Agreement, but in to any other limitation or condition contained herein; provided, however, no limitation shall apply to Fraud:

(i) No Indemnitor shall be liable for any Loss, unless and until the aggregate of Losses equal or exceeds US$50,000, in which case indemnification shall be made from the first dollar amount.

(ii) The Indemnitor’s liability shall be limited to the Purchase Price and each Indemnitee shall be entitled to receive a pro rata share of the indemnifiable Loss, based the Purchase Price.

(c) Claims Notice; Third Party Claims. In the event that an Indemnitee wishes to assert a claim for indemnification hereunder it shall give the Indemnitor a prompt written notice thereof (a “Claims Notice”), which shall describe in reasonable detail the facts and circumstances upon which the asserted claim for indemnification is based and thereafter keep the Indemnitor informed, in all material respects, with respect thereto. In the event that such Claims Notice results from a third party claim against the Indemnitee, such Indemnitee shall promptly upon becoming aware of the commencement of proceedings by such third party provide the Indemnitor with the Claims Notice and the Indemnitor shall have the right to assume the defense thereof (at Indemnitor’s expense) with counsel mutually satisfactory to the parties; provided, however, that the Indemnitees shall have the right to retain their own counsel, at the reasonable expense of the Indemnitor, and within the indemnification limitations herein, if representation of all parties by the counsel retained by the Indemnitor would be inappropriate due to actual or potential differing interests between the parties in such proceeding. Failure of the Indemnitees to give prompt notice or to keep it informed, as provided herein, shall not relieve the Indemnitor of any of its obligations hereunder, except to the extent that the Indemnitor is actually and materially prejudiced by such failure. The Indemnitor shall not be liable nor shall it be required to indemnify or hold harmless the Indemnitee in connection with any settlement effected without its consent in writing, which shall not be unreasonably withheld or delayed.

(d) Sole Remedy. The indemnification provided by the Indemnitor hereunder and the enforcement of such indemnification shall be the exclusive remedy available to the Indemnitees under this Agreement, other than for Fraud; provided that this provision does not limit the right to seek specific performance, a restraining order or injunctive relief with respect to any provision of this Agreement.

MISCELLANEOUS.

8.1 Further Assurances. Each of the parties hereto shall perform such further acts and execute such further documents as may reasonably be necessary to carry out and give full effect to the provisions of this Agreement and the intentions of the parties as reflected thereby.

8.2 Entire Agreement. This Agreement (including the exhibits and schedules hereto) and the other Transaction Documents constitute the full and entire understanding and agreement between the parties with respect to the subject matter hereof, and supersede all prior agreements and understandings, both written and oral, among any of the parties hereto, with respect to the subject matter hereof (with no concession being made as to the existence of any such prior agreements or understandings).

8.3 Amendment; Waiver. Except as explicitly set forth herein, any term of this Agreement may be amended only with the written consent of both the Company and the Investor. The observance of any term hereof may be waived (either prospectively or retroactively and either generally or in a particular instance) only by the prior written consent of the party against which enforcement of such waiver shall be sought. Any amendment or waiver effected in accordance with this Section ‎8.3 shall be binding upon the Investor and each transferee of the Purchased Securities, each future holder of all such securities and the Company.

8.4 Assignment; Successors and Assigns. None of the rights, privileges or obligations set forth in, arising under, or created by this Agreement may be assigned or transferred by an Investor, without the prior written consent of the Company. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

8.5 Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with to the laws of the State of Israel, disregarding its conflict of laws rules. Any dispute arising under or in relation to this Agreement shall be resolved exclusively in the competent court located in Tel Aviv-Jaffa, Israel and each of the parties hereby irrevocably submits to the exclusive jurisdiction of such court. Each of the parties hereto (i) consents to submit itself to the exclusive jurisdiction of the abovementioned courts in the event any dispute arises out of this Agreement or the transactions contemplated by this Agreement, (ii) agrees that it shall not attempt to deny or defeat such jurisdiction by motion or other request for leave from the abovementioned court, (iii) agrees that it shall not bring any action relating to this Agreement or the transactions contemplated by this Agreement in any court other than the abovementioned court, and (iv) irrevocably consents to service of process in the manner provided by Section ‎8.6 or as otherwise provided by applicable law.

8.6 Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt, or (i) when delivered, if sent by personal delivery to the party to be notified, (ii) when sent, if sent by electronic mail or facsimile (with electronic conformation of delivery) on a business day and during normal business hours of the recipient, and otherwise on the first business day in the place of recipient, (iii) five (5) business days after having been sent, if sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one (1) business day after deposit with an internationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written confirmation of receipt. All communications shall be sent to the respective parties at their address or contact details as set forth below, or to such address or contact details as subsequently modified by written notice given in accordance with this Section 8.6 or, in the case of the Investor, as used for purposes of sending shareholders’ notices by the Company.

If<br>to the Company:	Habarzel<br>7, Tel Aviv, Israel 6971011
	Attention:	Dan<br>Sztybel
	Telephone:	+972-72-2116144
	E-mail:	dan@savefoods.co

	with<br>a mandatory copy to (which shall not constitute a notice):
	Meitar<br>Law Offices<br><br>16<br>Abba Hillel St., Ramat-Gan, Israel
	Attention:	Matthew<br>Rudolph, Adv.
	Telephone:	+972-3-6103717
	E-mail:	matthewr@meitar.com

If<br>to the Investor:	Omer<br>Industrial Park, No. 7A, P.O. Box 3030, Omer 8496500, Israel
	Attention:	Liron<br>Carmel
	Telephone:	+972<br>72 260-2200
	Email:	Liron.Carmel@medigus.com

	with<br>a mandatory copy to (which shall not constitute a notice):
	Meitar Law Offices<br><br>16 Abba Hillel St., Ramat-Gan, Israel
	Attention:	Dr.<br>Shachar Hadar, Adv.
	Telephone:	+972-3-6103961
	E-mail:	shacharh@meitar.com

8.7 Delays or Omissions. Except as expressly provided herein, no delay or omission to exercise any right, power or remedy accruing to any party to this Agreement upon any breach or default of any other party under this Agreement, shall impair any such right, power or remedy of such non-defaulting party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default therefore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any party to this Agreement, shall be cumulative and not alternative.

8.8 Interpretation. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. Unless the context requires otherwise, the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety, and not to any particular provision hereof, and all references herein to Sections shall be construed to refer to Sections to this Agreement. Reference to “governmental authorities” (or similar terms) shall include any: (a) nation, principality, state, commonwealth, territory, county, municipality, district or other jurisdiction of any nature, (b) federal, state, local, municipal, foreign or other government, (c) governmental, quasi-governmental or regulatory body of any nature, including any governmental division, subdivision, department, agency, bureau, branch, office, commission, council, board, instrumentality, organization, unit, or body, or (d) court, public or private arbitrator or other public tribunal. Reference to a “person” shall mean any individual, corporation, partnership, limited liability company, firm, joint venture, association, joint-stock company, trust, estate, unincorporated organization, governmental authority or other entity, including, any party to this Agreement. Any reference to a “day” or a number of days (without explicit reference to “business days”) shall be interpreted as a reference to a calendar day or number of calendar days, and if any action is to be taken or given on or by a particular calendar day, and such calendar day is not a business day, then such action may be deferred until the first business day thereafter (where “business day” shall mean any day on which banking institutions in Tel-Aviv-Jaffa, Israel are generally open to the public for conducting business and are not required by law to close).

8.9 Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provision shall be excluded from this Agreement and the balance of the Agreement shall be enforceable in accordance with its terms and interpreted so as to give effect, to the fullest extent consistent with and permitted by applicable law, to the meaning and intention of the excluded provision.

8.10 Counterparts. This Agreement and any Transaction Document may be executed in one or more counterparts, all of which together shall constitute one and the same instrument, binding and enforceable against the parties so executing the same; it being understood that all parties need not sign the same counterpart. Counterparts may also be delivered by facsimile or email transmission (in pdf format or the like, or signed with docusign, e-sign or any similar form of signature by electronic means) and any counterpart so delivered shall be sufficient to bind the parties to this Agreement or any other Transaction Document, as an original.

8.11 Waiver of Conflict; Acknowledgment. Each party to this Agreement acknowledges and agrees that it was advised, prior to the date hereof, that the law firm Meitar, Law Offices, is representing the Company and the Investor in connection with this Agreement and the transactions contemplated hereby, that the Company and such Investor have previously provided their consent to the foregoing in accordance with the applicable rules and shall not have any right, claim or demand against any party, such law firm or any of its employees, partners or representatives with respect to the foregoing.

Signature Pages Follow -

IN WITNESS WHEREOF, the parties have executed this SECURITIES PURCHASE AGREEMENT to be executed as of the date first written above.

	COMPANY:

	/s/ Dan Sztybel
	SAVE FOODS, INC.
	Name:	Dan<br>Sztybel
	Title:	Chief<br>Executive Officer

[Company Signature Page to Securities Purchase Agreement]

IN WITNESS WHEREOF, the parties have executed this SECURITIES PURCHASE AGREEMENT as of the date first written above.

INVESTOR:

/s/ Liron Carmel
MEDIGUS LTD.
Name:	Liron<br>Carmel
Title:	Chief<br>Executive Officer

[Investor Signature Page to Securities Purchase Agreement]

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to Rule 13a-14(a)

I, Dan Sztybel, certify that:

I have reviewed this Quarterly Report on Form 10-Q of SAVE FOODS, INC.;
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 12, 2020

/s/<br>Dan Sztybel
Dan<br>Sztybel
Chief<br>Executive Officer

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to Rule 13a-14(a)

I, Shlomo Zakai, certify that:

I have reviewed this Quarterly Report on Form 10-Q of SAVE FOODS, INC.;
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 12, 2020

/s/<br>Shlomo Zakai
Shlomo<br>Zakai
Chief<br>Financial Officer

Exhibit 32.1

SAVE FOODS, INC.

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

In connection with the Quarterly Report of SAVE FOODS, INC. (the “Company”) on Form 10-Q for the period ended September 30, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Dan Sztybel, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, that to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/<br>Dan Sztybel
Dan<br>Sztybel
Chief<br>Executive Officer

November<br>12, 2020

Exhibit 32.2

SAVE FOODS, INC.

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

In connection with the Quarterly Report of SAVE FOODS, INC. (the “Company”) on Form 10-Q for the period ended September 30, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Shlomo Zakai, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, that to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/<br>Shlomo Zakai
Shlomo<br>Zakai
Chief<br>Financial Officer
November<br>12, 2020

Nexentis Technologies Inc 10-Q for FY2020 Q3

About this 10-Q

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