Item 7.01 REGULATION FD DISCLOSURE
As we are preparing our past quarterly
and annual reports to become current, the Company wishes to update and disclose its current corporate and financing activities.
On July 19, 2020, the Company formed a
new wholly-owned subsidiary in Israel, Hachevra Legiduley Pkaot Beisrael Ltd. (the “New Subsidiary”), to develop a
fully automated and remotely managed system for growing saffron and other vegetables. On November 5, 2020, the New Subsidiary changed
its name to Saffron-Tech Ltd. (or “Saffron Tech”).
The Company, through Saffron Tech, plans
to roll out its proof of concept in the coming months. This technology will provide turnkey automated growing containers for high-quality,
high-yield saffron all year round. The Company is in advanced stages of developing and testing a fully automated and
remotely managed system for growing high-quality, high-yield saffron anywhere and anytime.
The Company’s technology offers a
controlled environment based on the Company’s deep knowledge in plant biology. The technology provides optimal conditions
for each stage of the plant’s development to reach optimal product quality.
The Company’s proof of concept utilizes
the “Grow Next to Consumer” policy and is therefore sustainable and fit the COVID-19 restrictions on transport. It
is also environmentally friendly, using economic levels of water, space, fertilizer, and energy. Accounting to the Company’s
calculations, we believe that the controlled indoor growing area will produce ten times more yield compared to the same land area
using traditional methods. The sealed environment eliminates the need for harmful pesticides and herbicides, producing a clean
and safe product that is easy to control from anywhere. The Company’s solution is easily scalable and pre-designed to quickly
grow operations.
Saffron is used in many industries, such
as the food industry, particularly by famous chefs and Michelin starred restaurants, the natural cosmetics industry and the natural
medicine industry and as a dye in the textile industry. Medicinal claims as an anti-depressant, antioxidant, and antiseptic are
constantly increasing.
The global saffron market size was valued
at USD 1 Billion in 2019 and is anticipated to attain a revenue based CAGR of 7.3% from 2020 to 2027. The market is expected
to grow over the next few years on account of demand from the pharmaceutical sector, particularly in countries with rapid population
expansion.
Since the incorporation Saffron Tech, Saffron
Tech has hired one employee and several consultants to commence the roll out of our proof of concept. Saffron Tech has signed several
agreements with Israeli companies, including Growin Ltd (“Growin”) and the Israeli Ministry of Agricultures research
organization – The Volcani Center (“Volcani”). Growin is an owner of proprietary systems for indoor agriculture
and Saffron Tech has acquired the exclusive right to market, sell and commercialize our product based on the Growin’s hydroponic
machines. Volcani will assist Saffron Tech in writing the protocols required to grow saffron in a controlled and automated way,
including the use of robotics and AI.
CONVERTIBLE PROMISSORY NOTES
During November and December 2020, the
Company continued to raise funds to support its operations and received $775,000 from third party investors and convertible promissory
notes in respect thereof (“Promissory Notes”). The Promissory Notes bear no interest, are convertible into shares of
the Company based on a fixed conversion price of $0.10 per share and mature between 12 and 24 months from the issuance date.
CROWD FUNDING:
On December 24, 2020, Saffron Tech, the Company’s
subsidiary, announced its intention to raise up to 5 million New Israeli Shekels (“NIS”) (approximately $1.6 million)
at a pre-money valuation of NIS 20 million (approximately $6.225 million) through the Israeli crowd funding platform – Pipelbiz.
Assuming the maximum amount is raised, the Company will own approximately 80% of the Saffron Tech.
Management will disclose relevant information
as we progress in our activities and bring the Company current in its filings.
Item 9.01 Exhibits
(d) Exhibits.