CITRINE GLOBAL, CORP. - Quarter Report: 2014 June (Form 10-Q)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________

FORM 10-Q
___________________

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2014

Commission file number: 333-168527

BREEDIT CORP.
(Exact Name Of Registrant As Specified In Its Charter)

Delaware	68-0080601
(State of Incorporation)	(I.R.S. Employer Identification No.)

40 Wall Street, 28th Floor, New York, NY	10005
(Address of Principal Executive Offices)	(ZIP Code)

Registrant's Telephone Number, Including Area Code: (212) 400-7198

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act) or a smaller reporting company .

Large accelerated filer ¨

Accelerated filer ¨

Non-Accelerated filer ¨

Smaller reporting company x

On August 6, 2014, the Registrant had 91,013,512 shares of common stock outstanding.

TABLE OF CONTENTS

Item	Description	Page

	PART I - FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS - UNAUDITED.
	Balance Sheets	3
	Statements of Operations	4
	Statements of Cash Flows	6
	Notes to Financial Statements	8
ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS.	17
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	23
ITEM 4.	CONTROLS AND PROCEDURES.	23

	PART II - OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS.	23
ITEM 1A.	RISK FACTORS.	23
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.	23
ITEM 3.	DEFAULT UPON SENIOR SECURITIES.	24
ITEM 4.	MINE SAFETY DISCLOSURE.	24
ITEM 5.	OTHER INFORMATION.	24
ITEM 6.	EXHIBITS.	24

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS Back to Table of Contents

BREEDIT CORP.
(Formerly Progaming Platforms Corp.)
(A Development Stage Company)
Balance Sheets
As of June 30, 2014 and December 31, 2013
Back to Table of Contents
		June 30, 2014
		(Unaudited)		December 31, 2013
ASSETS
Current assets:
Cash and cash equivalents	$	1,466,592	$	656,067
Certificate of deposit		1,023,058		-
Restricted cash		-		43
Other receivables		10,683		-
Total current assets		2,500,333		656,110
Property and equipment, net		4,964		168
Total assets	$	2,505,297	$	656,278

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued liabilities	$	45,798	$	59,574
Deferred revenues		5,800		5,800
Related parties payable		27,000		2,305
Accrued interest payable		28,360		15,565
Convertible notes payable, net of discount		137,274		76,808
Total current liabilities		244,232		160,052

Long-term deferred revenues		5,776		8,676

Total liabilities		250,008		168,728

Stockholders' equity (deficit)
Common stock, par value $0.0001 per share, 5,000,000,000 shares authorized:
90,413,512 and 72,255,917 shares issued and outstanding at June 30, 2014 and December 31, 2013, respectively		904		723
Stock payable		199,647		321,447
Accumulated other comprehensive income		1,860		(340)
Non-controlling interest		(21,904)		47,523
Stock subscription receivable		(300)		(300)
Additional paid-in capital		7,502,974		2,015,172
(Deficit) accumulated during the development stage		(5,427,892)		(1,896,675)
Total stockholders' equity (deficit)		2,255,289		487,550
Total liabilities and stockholders' equity (deficit)	$	2,505,297	$	656,278

The accompanying notes are an integral part of these financial statements.

BREEDIT CORP.
(Formerly Progaming Platforms Corp.)
(A Development Stage Company)
Statements of Operations
For the Three and Six-Month Periods Ended June 30, 2014 and 2013 and From Inception (May 26, 2010) to June 30, 2014
(Unaudited)
Back to Table of Contents

										For the period from
		For the three		For the three		For the six		For the six		date of inception
		months ended		months ended		months ended		months ended		(May 20, 2010) to
		June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013		June 30, 2014

Revenues	$	1,450	$	1,446	$	2,900	$	2,876	$	107,424

Expenses
Research and development		(20,810)		-		(41,776)		-		(158,996)
General and administrative		(236,374)		(21,545)		(3,512,562)		(44,952)		(5,391,137)
Total operating expenses		(257,184)		(21,545)		(3,554,338)		(44,952)		(5,550,133)

(Loss) from operations		(255,734)		(20,099)		(3,551,438)		(42,076)		(5,442,709)

Interest expense		(6,398)		(3,435)		(12,795)		(6,627)		(31,332)
Amortization of debt discount		(31,795)		(22,701)		(64,466)		(43,350)		(155,075)
Loss on trading securities		-		(47,519)		-		(112,828)		(114,752)
Other income / (expense)		28,750		1,218		26,954		4,152)		9,747)
Financial income (expense)		(9,443)		(72,437)		(50,307)		(158,653)		(291,412)

Provision for income taxes		-		-		-		-		-

Net (loss)	$	(265,177)	$	(92,536)	$	(3,601,754)	$	(200,729)	$	(5,734,121)

Less: loss (income) attributable to non-controlling interest		33,905		-		70,528		-		306,229

Net loss (income) attributable to BreedIT Corp.	$	(231,272)	$	(92,536)	$	(3,531,217)	$	(200,729)	$	(5,427,892)

Net loss per common share - basic and diluted	$	(0.00)	$	(0.00)	$	(0.04)	$	(0.00)

Weighted average number of common shares outstanding - basic		89,582,578		52,197,055		83,716,789		52,197,055

The accompanying notes are an integral part of these financial statements.

										For the period from
		For the three		For the three		For the six		For the six		date of inception
		months ended		months ended		months ended		months ended		(May 20, 2010) to
		June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013		June 30, 2014
Foreign currency translation gain (loss)		(424)		-		3,300		-		(2,960)
Add: loss attributable to non-controlling interest		(33,905)		-		(70,528)		-		(306,229)
Total comprehensive loss		(265,601)		(92,536)		(3,598,445)		(200,729)		(5,737,081)
Less: comprehensive loss attributable to non-controlling interest		33,905		-		70,528		-		306,229
Comprehensive loss attributable to BreedIT Corp.	$	(231,696)	$	(92,536)	$	(3,527,917)	$	(200,729)	$	(5,430,852)

The accompanying notes are an integral part of these financial statements.

BREEDIT CORP.
(Formerly Progaming Platforms Corp.)
(A Development Stage Company)
Statements of Cash Flows
For the Six-Month Periods Ended June 30, 2014 and 2013 and for the Period from Inception (May 26, 2010) to June 30, 2014
(Unaudited)
Back to Table of Contents
		For the six		For the six		Cumulative
		months ended		months ended		From
		March 31, 2014		March 31, 2013		Inception
Operating Activities:
Net (loss)	$	(3,601,754)	$	(200,729)	$	(5,734,121)
Adjustments to reconcile net (loss) to net cash (used in) operating activities:
Loss on trading securities		-		112,828		131,022
Depreciation		769		155		1,548
Amortization of debt discount		64,466		43,350		155,075
Shares issued for services		480,000		-		938,771
Warrants issued for services		59,072		-		214,822
Options issued for services		2,594,209		-		2,594,209
Impairment of goodwill		-		-		630,880
Changes in net assets and liabilities:
Decrease (increase) in other current assets		(10,683)		-		(14,746)
Decrease (increase) in prepaid expenses		-		-		(1,460)
Decrease (increase) in accounts payable		(13,776)		(16,874)		4,367
(Decrease) increase in accrued expenses		12,795		-		39,160
(Decrease) increase in related parties payable		24,695		(6,000)		76,785
Investment in trading securities		-		4,850		-
(Decrease) increase in deferred revenue		(2,900)		(2,876)		11,576
Contribution of services from shareholder		-		-		17,100
Other assets		(1,023,015)		4,082		(1,014,990)
Net cash used in operating activities		(1,416,113)		(61,214)		(1,950,002)

Investing activities:
Purchases of property and equipment		(5,562)		-		(6,509)
Cash received from sale of trading securities		-		49,324		63,545
Net cash used in investing activities		(5,562)		49,324		57,036

Financing activities:
Borrowing on debt		-		6,900		233,220
Proceeds from exercise of warrants		188,000		-		188,000
Principal payments on debt		-		-		(10,020)
Proceeds from sale of common stock (net of issuance expenses)		2,040,900		-		2,945,398
Net cash provided by financing activities		2,228,900		6,900		3,356,598
Foreign currency adjustment		3,300		-		2,960

Net increase (decrease) in cash		810,525		(4,990)		1,466,592
Cash and cash equivalents at beginning of period		656,067		21,392		-
Cash and cash equivalents at end of period	$	1,466,592	$	16,402	$	1,466,592

Non cash transactions:
Shares issued for investment in trading securities	$	-	$	-	$	190,504
Non-controlling interest in related to BreedIT Ltd.	$	-	$	-	$	305,433
Stock subscribed for acquisition of BreedIT Ltd.	$	-	$	-	$	321,447
Debt discount	$	-	$	2,500	$	218,800
Forgiveness of accrued debt by related parties	$	-	$	49,000	$	49,000
Conversion of debt to equity	$	4,000	$	-	$	25,172
Liabilities assumed at acquisition of BreedIT Ltd.	$	-	$	-	$	26,209
Shares issued from stock payable	$	151,800	$	-	$	151,800
Cashless exercise of warrants	$	3	$	-	$	3

Additional information:
Cash paid for interest expenses	$	-	$	-	$	-
Cash paid for income taxes	$	-	$	-	$	-

The accompanying notes are an integral part of these financial statements.

BREEDIT CORP.
(formerly Progaming Platforms Corp.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
June 30, 2014 (Unaudited)
Back to Table of Contents

(1) Summary of Significant Accounting Policies

Basis of Presentation and Organization

BreedIt Corp. ("BreedIt" or the "Company") is a Delaware corporation in the development stage and has not commenced operations. The Company was incorporated under the laws of the State of Delaware on May 26, 2010. On October 24, 2013 we entered into an agreement to acquire 66.67% of BreedIT Israel's capital stock. Subsequently, we were issued 200 shares of BreedIT Israel's capital stock ("Ordinary Shares") which represent 66.67% of BreedIT's outstanding Ordinary Shares with the founder, Dr. Oded Sagee owning the remaining 100 Ordinary Shares, representing 33.33% of the outstanding Ordinary Shares.

BreedIT Ltd. signed a binding agreement with a leading Israeli university granting BreedIT Ltd. the exclusive, world-wide license for a unique and highly sophisticated decision making software used for the purpose of advanced agriculture breeding (the "IDSS Software"). The business plan of the Company through its BreedIT Ltd subsidiary is to further develop and market the IDSS Software system globally to the agricultural breeding industry.

The accompanying unaudited financial statements of the Company are presented in accordance with the requirements of Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP") have been condensed or omitted pursuant to such SEC rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for an air presentation have been made. The results for these interim periods are not necessarily indicative of the results for the entire year. The accompanying financial statements should be read in conjunction with the Company's audited financial statements for the year ended December 31, 2013 and the notes thereto included in the Company's Report on Form 10-K filed with the SEC on March 31, 2014.

Cash and Cash Equivalents

For purposes of reporting within the statement of cash flows, the Company considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalents. As of June 30, 2014 and December 31, 2013, we had cash of $1,466,592 and $656,067, respectively.

Restricted cash

Cash and cash items which are restricted as to withdrawal or usage. Restricted cash includes legally restricted deposits held as compensating balances against credit cards. As of June 30, 2014 and December 31, 2013, we had restricted cash of $0 and $43, respectively.

Certificate of Deposit

Certificates of deposit are held for seven days, renew automatically and bear interest of 0.02% per annum. As of June 30, 2014 and December 31, 2013, we had Certificates of deposit of $1,023,058 and $0 respectively.

Other Receivables

VAT paid to vendors net of VAT collected on sales, if any, is claimed back from Israeli VAT Authority. The amount claimed is accordingly charged to other receivables. In prior periods amounts claims were expensed to bad debt until reasonable assurance of collectability was established. During Q2 prior period VAT amounts claimed were collected and prior period entries to bad debt reversed. The amount currently included in other receivables reflect VAT paid but not yet collected from the VAT authority.

Revenue Recognition

The Company recognizes revenue from licensing its software to customers for contractually defined periods of time. The Company recognizes revenue ratably over the term of the contract in accordance with ASC 605 (1) when the price is fixed and determinable, (2) persuasive evidence of an arrangement exists, (3) delivery has occurred or services have been provided, and (4) collectability is assured.

Loss per Common Share

Basic loss per share is computed by dividing the net loss attributable to the common stockholders by the weighted average number of shares of common stock outstanding during the period. Fully diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are determined based on temporary differences between the bases of certain assets and liabilities for income tax and financial reporting purposes. The deferred tax assets and liabilities are classified according to the financial statement classification of the assets and liabilities generating the differences.

The Company maintains a valuation allowance with respect to deferred tax assets. The Company establishes a valuation allowance based upon the potential likelihood of realizing the deferred tax asset and taking into consideration the Company's financial position and results of operations for the current period. Future realization of the deferred tax benefit depends on the existence of sufficient taxable income within the carryforward period under the Federal tax laws.

Changes in circumstances, such as the Company generating taxable income, could cause a change in judgment about the realizability of the related deferred tax asset. Any change in the valuation allowance will be included in income in the year of the change in estimate.

Fair Value of Financial Instruments

The Company estimates the fair value of financial instruments using the available market information and valuation methods. Considerable judgment is required in estimating fair value. Accordingly, the estimates of fair value may not be indicative of the amounts the Company could realize in a current market exchange. As of As of June 30, 2014 and December 31, 2013, the carrying value of accounts payable and accrued liabilities approximated fair value due to the short-term nature and maturity of these instruments.

Property and equipment:

Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over the estimated useful lives of the assets. The annual depreciation rates are as follows: Computers and electronic equipment 33%

Deferred Offering Costs

The Company defers as other assets the direct incremental costs of raising capital until such time as the offering is completed. At the time of the completion of the offering, the costs are charged against the capital raised. Should the offering be terminated, deferred offering costs are charged to operations during the period in which the offering is terminated.

Impairment of Long-Lived Assets

The Company evaluates the recoverability of long-lived assets and the related estimated remaining lives when events or circumstances lead management to believe that the carrying value of an asset may not be recoverable. As of June 30, 2014, no events or circumstances occurred for which an evaluation of the recoverability of long-lived assets was required.

Estimates

The financial statements are prepared on the basis of accounting principles generally accepted in the United States. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of As of June 30, 2014 and December 31, 2013, and expenses for the year ended as of June 30, 2014 and the periods from inception to June 30, 2014. Actual results could differ from those estimates made by management.

Fair value measurements

As defined in ASC 820-10, Fair Value Measurements and Disclosures ("ASC 820-10"), fair value is based on the price that would be received to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, ASC 820-10 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.
Level 2: Other inputs that are observable, directly or indirectly, such as quoted prices for similar assets and liabilities or market corroborated inputs.
Level 3: Unobservable inputs are used when little or no market data is available, which requires the Company to develop its own assumptions about how market participants would value the assets or liabilities. The fair value hierarchy gives the lowest priority to Level 3 inputs.

In determining fair value, the Company utilizes valuation techniques in its assessment that maximize the use of observable inputs and minimize the use of unobservable inputs.

The following table presents the Company's financial assets and liabilities that are carried at fair value, classified according to the three categories described above:

Fair Value Measurements at June 30, 2014
				Quoted Prices in Active		Significant Other		Significant
				Markets for Identical Assets		Observable Inputs		Unobservable Inputs		Gains
		Total		(Level 1)		(Level 2)		(Level 3)		(Losses)
Investment in Trading Securities	$	-	$	-	$	-	$	-	$	-
Total assets at fair value	$	-	$	-	$	-	$	-	$	-

Fair Value Measurements at December 31, 2013
				Quoted Prices in Active		Significant Other		Significant
				Markets for Identical Assets		Observable Inputs		Unobservable Inputs		Gains
		Total		(Level 1)		(Level 2)		(Level 3)		(Losses)
Investment in Trading Securities	$	-	$	-	$	-	$	-	$	(114,752)
Total assets at fair value	$	-	$	-	$	-	$	-	$	(114,752)

Impact of recently issued accounting standards

n July 2013, FASB issued ASU No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." The provisions of ASU No. 2013-11 require an entity to present an unrecognized tax benefit, or portion thereof, in the statement of financial position as a reduction to a deferred tax asset for a net operating loss carryforward or a tax credit carryforward, with certain exceptions related to availability. ASU No. 2013-11 is effective for interim and annual reporting periods beginning after December 15, 2013. The adoption of ASU No. 2013-11 is not expected to have a material impact on the Company's Consolidated Financial Statements.

In February 2013, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, to improve the transparency of reporting these reclassifications. Other comprehensive income includes gains and losses that are initially excluded from net income for an accounting period. Those gains and losses are later reclassified out of accumulated other comprehensive income into net income. The amendments in the ASU do not change the current requirements for reporting net income or other comprehensive income in financial statements. All of the information that this ASU requires already is required to be disclosed elsewhere in the financial statements under U.S. GAAP. The new amendments will require an organization to:

- Present (either on the face of the statement where net income is presented or in the notes) the effects on the line items of net income of significant amounts reclassified out of accumulated other comprehensive income - but only if the item reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period; and
- Cross-reference to other disclosures currently required under U.S. GAAP for other reclassification items (that are not required under U.S. GAAP) to be reclassified directly to net income in their entirety in the same reporting period. This would be the case when a portion of the amount reclassified out of accumulated other comprehensive income is initially transferred to a balance sheet account (e.g., inventory for pension-related amounts) instead of directly to income or expense.
The amendments apply to all public and private companies that report items of other comprehensive income. Public companies are required to comply with these amendments for all reporting periods (interim and annual). The amendments are effective for reporting periods beginning after December 15, 2012, for public companies. Early adoption is permitted. The adoption of ASU No. 2013-02 is not expected to have a material impact on our financial position or results of operations.

In January 2013, the FASB issued ASU No. 2013-01, Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities, which clarifies which instruments and transactions are subject to the offsetting disclosure requirements originally established by ASU 2011-11. The new ASU addresses preparer concerns that the scope of the disclosure requirements under ASU 2011-11 was overly broad and imposed unintended costs that were not commensurate with estimated benefits to financial statement users. In choosing to narrow the scope of the offsetting disclosures, the Board determined that it could make them more operable and cost effective for preparers while still giving financial statement users sufficient information to analyze the most significant presentation differences between financial statements prepared in accordance with U.S. GAAP and those prepared under IFRSs. Like ASU 2011-11, the amendments in this update will be effective for fiscal periods beginning on, or after January 1, 2013. The adoption of ASU 2013-01 is not expected to have a material impact on our financial position or results of operations.

In October 2012, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2012-04, "Technical Corrections and Improvements" in Accounting Standards Update No. 2012-04. The amendments in this update cover a wide range of Topics in the Accounting Standards Codification. These amendments include technical corrections and improvements to the Accounting Standards Codification and conforming amendments related to fair value measurements. The amendments in this update will be effective for fiscal periods beginning after December 15, 2012. The adoption of ASU 2012-04 is not expected to have a material impact on our financial position or results of operations.

In August 2012, the FASB issued ASU 2012-03, "Technical Amendments and Corrections to SEC Sections: Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin (SAB) No. 114, Technical Amendments Pursuant to SEC Release No. 33-9250, and Corrections Related to FASB Accounting Standards Update 2010-22 (SEC Update)" in Accounting Standards Update No. 2012-03. This update amends various SEC paragraphs pursuant to the issuance of SAB No. 114. The adoption of ASU 2012-03 is not expected to have a material impact on our financial position or results of operations.

In July 2012, the FASB issued ASU 2012-02, "Intangibles - Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment" in Accounting Standards Update No. 2012-02. This update amends ASU 2011-08, Intangibles - Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment and permits an entity first to assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform the quantitative impairment test in accordance with Subtopic 350-30, Intangibles - Goodwill and Other - General Intangibles Other than Goodwill. The amendments are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted, including for annual and interim impairment tests performed as of a date before July 27, 2012, if a public entity's financial statements for the most recent annual or interim period have not yet been issued or, for nonpublic entities, have not yet been made available for issuance. The adoption of ASU 2012-02 is not expected to have a material impact on our financial position or results of operations.

Goodwill and Intangible Assets

Goodwill is tested for impairment at a minimum on an annual basis. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the reporting unit's carrying value is compared to its fair value. The fair values of the reporting units are estimated using market and discounted cash flow approaches. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. The discounted cash flow approach uses expected future operating results. Failure to achieve these expected results may cause a future impairment of goodwill at the reporting unit. We conducted our annual impairment tests of goodwill as of June 30, 2014. As a result of these tests, we recorded impairment charges to our goodwill during the year ended December 31, 2013 of $630,880.

Intangible assets consist of patents and trademarks, purchased customer contracts, purchased customer and merchant relationships, purchased trade names, purchased technology, and non-compete agreements. Intangible assets are amortized over the period of estimated benefit using the straight-line method and estimated useful lives ranging from two to twenty years. No significant residual value is estimated for intangible assets.

(2) Development Stage Activities and Going Concern

The Company is currently in the development stage and has limited or not commenced operations. The business plan of the Company transitioned from being a provider of online gaming software to the developer and provider of an intelligent decision support system ("IDSS") utilized by the agriculture breeding industry, we were able to utilize our software programming expertise. Our business efforts are now being directed toward offering our IDSS Software program to a wide variety of users engaged in plant breeding, primarily within the seed industry. We plan on marketing our IDSS Software to agro-breeders, providing them with the ability to better plan, manage and analyze their breeding data and to perform research activities quickly and effectively so as to significantly increase production and plant quality.

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has not established any source of revenue to cover its operating costs, and as such, has incurred an operating loss since inception. These and other factors raise substantial doubt about the Company's ability to continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

(3) Common Stock

On June 7, 2010, the Company issued 15,250,000 shares of its common stock to individuals who are directors and officers of the company for $153 subscriptions receivable.

On June 7, 2010, the Company issued 14,750,000 shares of its common stock to individuals who are founders of the company for $147 subscriptions receivable.

On December 21, 2010, the Company issued 20,000,000 shares of its common stock to various individuals, for $100,000 in cash. Such funds were raised through public offering, in accordance with the terms and conditions of the Registration Statement.

In April 2011, the Company sold 150,000 restricted shares to Guy Levinson and 250,000 restricted shares to Shlomo Sharbat, both are non-US private investor, for $40,000.

On March 18, 2012, the Company issued 25,000 restricted shares of common stock in consideration for financial advisory services provided to the Company. The shares were valued at $7,950 based on the closing price of the Company's common stock on the date of grant.

From October 16, 2013 through December 30, 2013, the Company sold to 22 non-US private accredited investors, a total of 15,750,260 units for cash consideration of $787,513 at a price of $0.05 (the "Units"), each unit comprised of one share of common stock, one class A warrant with 18 months term and one class B warrant with 24 month term, exercisable at a price of $0.055 and $0.065 respectively; of this total 4,500,000 units were sold to directors and officers. The relative fair value of the stock with attached warrants was $246,084 for the common stock, $266,967 for class A warrants and $274,462 for class B warrants.

On November 1, 2013 the Company issued 300,000 restricted shares of common stock in consideration for investor relations (IR) services provided to the Company. The shares were valued at $19,500 based on the closing price of the Company's common stock on the date of grant.

On November 18, 2013 the Company issued 1,000,000 restricted shares of common stock and 1,000,000 warrants with a term of 18 months, exercisable at $0.05 per share in consideration for investor relations (IR) services provided to the Company. The shares were valued at $112,000 based on the closing price of the Company's common stock on the date of grant. The warrants were valued using the Black-Scholes model with 117% volatility and 0.22% discount rate for a total of $78,861.

On November 19, 2013 the Company issued 1,600,000 restricted shares of common stock and 600,000 warrants with a term of 18 months, exercisable at $0.05 per share in consideration for investor relations (IR) services provided to the Company. The shares were valued at $182,400 based on the closing price of the Company's common stock on the date of grant. The warrants were valued using the Black-Scholes model with 117% volatility and 0.22% discount rate for a total of $47,316.

On December 10, 2013 the Company issued 350,000 restricted shares of common stock in consideration for investor relations (IR) services provided to the Company. The shares were valued at $42,000 based on the closing price of the Company's common stock on the date of grant.

On November 18, 2013 the Company issued 375,000 warrants with a term of 18 months, exercisable at $0.05 per share in consideration for investor relations (IR) services provided to the Company. The warrants were valued using the Black-Scholes model with 117% volatility and 0.22% discount rate for a total of $29,573.

During 2013 three shareholders converted $18,200 of debt and $2,972 of accrued interest to 1,058,602 shares at a conversion price of $0.02 per share. The conversion occurred within the terms of the convertible note agreements with no gain or loss recorded.

From January 23, 2014 to June 30, 2014 the Company sold to 10 non-US private accredited investors a total of 6,461,666 shares for cash consideration of $923,000 at an average price of $0.143.

From March 10, 2014 through June 30, 2014, the Company sold to 12 non-US private accredited investors, a total of 3,270,000 units for cash consideration of $667,750 at an average price of $0.204 (the "Units"), each unit comprised of one share of common stock, one class C warrant with 24 months term exercisable at a price of $0.35. The relative fair value of the stock with attached warrants was $189,300 for the common stock, $478,450 for class C warrants.

On February 24, 2014 and March 13, 2014 3 share and warrant holders exercised warrants and were issued 1,144,262 shares for cash consideration of $48,000.

On February 18, 2014 the Company issued to Dr. Oded Sagee minority owner and founder of BreedIT Ltd., 2,200,000 shares of our common stock valued based on the closing market price on the acquisition date at $151,800; 2,200,000 Class A options for the purchase of 2,200,000 shares of our common stock at $0.055 per share valued using the black-scholes model with volatility of 122% and a discount rate of 0.23% for a total value of $84,967; and 2,200,000 Class B options for the purchase of 2,200,000 shares of our common stock at $0.065 per share valued using the black-scholes model with volatility of 122% and a discount rate of 0.23% for a total value of $84,680.

During the period from February 19, 2014 to March 4, 2014, the Company granted a total of 5,050,000 stock options (the "Options") to 4 Company directors and officers who are also minatory owners. The Options, which vest over the period of 3 years in 12 equal quarterly installments, are exercisable at a price of $0.05 per Share. 1,400,000 options were valued using the Black-Scholes model with 128% volatility and 2.17% discount rate and 3,650,000 were valued using the Black-Scholes model with 154% volatility and 2.17% discount rate for a total of $2,594,210.

On March 12, 2014 the Company issued 30,000 warrants with term of 36 months, exercisable at $0.60 per share to 1 entity in consideration for public relations services provided to the company. The warrants were valued using the Black-Scholes model with 117% volatility and 0.22% discount rate for a total of $16,134.

On April 1, 2014 and April 7, 2014 the Company sold to 2 private accredited investors, a total of 1,215,000 units for cash consideration of $250,150 at an average price of $0.206 (the "Units"), each unit comprised of one share of common stock, one class C warrant with 24 months term exercisable at a price of $0.35. The relative fair value of the stock with attached warrants was $61,984 for the common stock, $188,166 for class C warrants.

On May 8, 2014 the Company sold to 1 private accredited investor, a total of 666,667 units for cash consideration of $200,001 at a price of $0.30 (the "Units"), each unit comprised of one share of common stock, one class H warrant with 3 months term exercisable at a price of $0.30 and one class I warrant with 18 month term exercisable at price of $0.45. The relative fair value of the stock with attached warrants was $69,916 for the common stock, $130,085 for warrants.

On April 12, 2014 the Company issued 1,00,000 warrants, vesting over 12 quarters in equal amounts starting July 1, 2014 with term of 36 months from vesting date, exercisable at $0.35 per share to 1 entity in consideration for serving on the company's scientific advisory board. The warrants were valued using the Black-Scholes model with 273% volatility and 0.80% discount rate for a total of $391,335 of this amount $42,938 was expensed during the quarter with balance to be expensed over remaining term.

On April 14, 2014 and on June 22, 2014 share and warrant holders exercised warrants for cash consideration of $140,000, in return 2,000,000 shares were issued and as of balance sheet date 600,000 shares are to be issued.

During Q2 2014 one shareholder converted $4,000 of debt and accrued interest to 200,000 shares at a conversion price of $0.02 per share. The conversion occurred within the terms of the convertible note agreements with no gain or loss recorded.

Share based payment transactions were accounted for in accordance with the requirements of ASC 505-50 Equity Based Payments to Non Employees. Paragraph 505-50-30-6 establishes that share-based payment transactions with nonemployees shall be measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. The Company measured share-based payment transactions at the fair value of the shares issued at date of grant, the Company believes that the value of the shares is more reliably measurable.

On March 1, 2012, the Company filed a Certificate of Amendment to its Certificate of Incorporation effecting a forward stock split of the Company's issued and outstanding shares of Common Stock at a ratio of ten-to-one (the "Forward Split"). The Certificate of Amendment provides that each outstanding share of the Company's Common Stock, par value $0.0001 per share, will be split and converted, automatically, without further action, into ten (10) shares of Common Stock of $0.00001 par value per share. The Forward Split has been reflected in the Company's financial statements for year ended December 31, 2013 and 2012.

(4) Revenue Recognition

On July 1, 2011 and on July 10, 2011, the Company signed license agreements with two separate corporations in Israel and Luxemburg (the "Licensees"). Subject to the terms and condition of each agreement the Company granted each Licensee a license to use the Company's proprietary online gaming platform in certain parts of the world. Each license is, in general, non-exclusive, except for certain countries specified within each agreement. The agreements grant each Licensee the right to develop and operate websites offering online games based on the Company's proprietary technology for a period of 5 years as of the respective agreement's effective date. In the event that by the eighteenth-month anniversary of the each agreement's effective date the respective Licensee fails to have at least one active website in each of the countries that comprise the exclusive territory of the agreement, the Company shall be entitled to either terminate exclusivity for these countries or terminate the entire agreement. In consideration of these agreements, and of support services to be provided by the Company through the license period, the Licensees have paid the Company non-refundable, one-time license fees totaling $119,000. In addition to such license fees, once each Licensee realizes revenues at a certain level specified in its respective agreement from its use of the Company's platform, it shall pay the Company a royalty in the amount of 50% of gross revenues realized from its use of this platform.

On December 26, 2011, the corporation from Luxemburg announced the termination of the agreement due to the economic situation in Europe. As a result, the entire license fee in the amount of $90,000 was recognized immediately as revenues.
As of the three and six months ended June 30, 2014, the Company recognized a total sum of $1,450 and $2,900 compared to $1,446 and $2,876, respectively, for the three and six months ended June 30, 2013 out of the total $119,000 license fees paid for both of the aforementioned agreements. The contract in the amount of $90,000 was canceled by the client; therefore we recognized the whole sum as revenues according to the terms of the agreement. The second contract grants the client licenses for a period of 5 years, the remaining sum of $11,576 was deferred on the Company's balance sheet, $5,800 as current and $5,776 as long term liabilities, and is expected to be recognized over the remaining period of the agreements.

As of June 30, 2014 and 2013, no royalties have been paid by or recognized in connection with the aforementioned agreements.

One of the aforementioned Licensees is beneficially owned by an individual who holds 25,000 shares of the Company's common stock.

(5) Acquisitions during Fiscal Year Ended December 31, 2013

We completed the acquisition of 66.6% of BreedIT Ltd. in furtherance of our strategy to acquire small, privately owned enterprises in the software sector through asset purchase structures. We made the acquisitions to expand our market presence and product offerings in areas that complement our experience in software platforms.

The purchase consideration for the acquisition was allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values on the acquisition date, with the remaining unallocated consideration recorded as goodwill. An independent valuation expert assisted us in determining these fair values.

We have included the financial results of these acquisitions in our consolidated financial statements from the date of acquisition.

BreedIT Ltd.

We acquired 66.67% of BreedIT Ltd, in October 2013 pursuant to an asset purchase agreement. The assets acquired consisted of all application software, licensing agreement with academic institution for marketing the software and brands. We assumed some liabilities in the transaction as described below. BreedIT Ltd. was established on July 4th, 2013 by Dr. Oded Sagee.

The purchase consideration for 66.67% totaling $566,447 consisted of: (1) $245,000 in cash; (2) 2,200,000 shares of our common stock valued based on the closing market price on the acquisition date at $151,800; (3) 2,200,000 Class A options for the purchase of 2,200,000 shares of our common stock at $0.055 per share valued using the black-scholes model with volatility of 122% and a discount rate of 0.23% for a total value of $84,967; and (4) 2,200,000 Class B options for the purchase of 2,200,000 shares of our common stock at $0.065 per share valued using the black-scholes model with volatility of 122% and a discount rate of 0.23% for a total value of $84,680. The total net assets of the company including the non controlling interest was $849,671 on the date of acquisition.

The allocation of the purchase consideration to the assets and liabilities acquired was as follows:

Cash	$	245,000
Net Liabilities		(26,209)
Goodwill		630,880
Total assets acquired	$	849,671

(6) Goodwill and Intangible Assets

Goodwill

The following table presents goodwill and impairment for the years ended December 31, 2013 and 2012:

		Goodwill
December 31, 2011	$	-
Acquired		-
Impairment		(-)
December 31, 2012		-
Acquired		630,880
Impairment		(630,880)
December 31, 2013	$	-

We conducted our annual impairment test of goodwill as of December 31, 2013, which resulted in impairment charges of $630,880.

(7) Related Party Transactions

As described in Note 3, on June 7, 2010, the Company issued 15,250,000 shares of its common stock to directors and officers for $153 subscriptions receivable.

In addition as described in Note 3, From October 16, 2013 through December 30, 2013, the Company sold to 22 non-US private investor, a total of 15,750,260 million units for cash consideration of $787,513 at a price of $0.05 (the "Units"), each unit comprised of one share of common stock, one class A warrant and one class B warrant, exercisable at a price of $0.055 and $0.065 respectively; of this total 4,500,000 units were sold to directors and officers for $225,000 subscriptions receivable. The relative fair value of the stock with attached warrants was $219,707 for the common stock, $280,826 for class A warrants and $286,981 for class B warrants.

During 2013 forgiveness of Accrued Debt by related parties was recorded in the amount of $49,000.

In 2013 $2,305 accrued liability was recorded for consulting fees due to a related party.

On April 14, 2014 1 related share and warrant holder exercised warrants and was issued 2,000,000 shares for cash consideration of $110,000.

Related Parties payable as of June 30, 2014 and December 31, 2013 are $27,000 and $2,305 respectively the increase is due to an increase in liabilities to related party.

(8) Convertible and Non-Convertible Notes Payable

During the year ended December 31, 2013, we received $6,900 through the issuance of two convertible notes, bearing interest at the rate of 15% per annum, have a maturity date of 12 months and are convertible into common stock at $0.02 per share. The $6,900 of debt along with $729 of accrued interest was converted to 381,453 shares of common stock at $0.02 per share. The conversion occurred within the terms of the convertible note agreements with no gain or loss recorded on the conversion.

During the year ended December 31, 2013, a convertible note of $11,300 along with $2,243 of accrued interest was converted to 677,149 shares of common stock at $0.02 per share. The conversion occurred within the terms of the convertible note agreement with no gain or loss recorded on the conversion.

During the year ended December 31, 2013, we received $130,000 through the issuance of two convertible notes, bearing interest at the rate of 10% per annum, have a maturity date of 12 months and are convertible into common stock at $0.05 per share.

During the year ended December 31, 2013, we received $10,020 through the issuance of non-convertible notes bearing interest at a rate of one (1%) per annum and which have maturity date of 12 months.

During Q2 2014 one shareholder converted $4,000 of debt and accrued interest to 200,000 shares at a conversion price of $0.02 per share. The conversion occurred within the terms of the convertible note agreements with no gain or loss recorded.

For the three and six months ended June 30, 2014 the Company recorded amortization expenses related to the beneficial conversion features of $31,795 and $64,466 as compared to $22,701 and $43,350 for the three and six months ended June 30, 2013, respectively.

The Company recorded interest expense in the amount of $6,398 and $12,795 for the three and six months ended June 30, 2014 as compared to $3,435 and $6,627 for the three and six months ended June 30, 2013, respectively.

(9) Investments

Investments in Trading Securities as of June 30, 2014 and December 31, 2013 are summarized below:

		Cost Basis		Unrealized Gains		Realized Losses		Unrealized Losses		Fair Value
June 30, 2014	$	-	$	-	$	-	$	-	$	-
December 31, 2013 Trading Securities		-		-		114,752		-		-

As of June 30, 2014 and December 31, 2013 the company owns no shares of Gefen Biomed Investments, a publicly traded company. During the year ended December 31, 2013, the Company recorded a realized loss of $114,752 due to their decreased market value as compared to December 31, 2012.

(10) Subsequent Events

As defined in FASB ASC 855-10, “Subsequent Events”, subsequent events are events or transactions that occur after the balance sheet date but before financial statements are issued or available to be issued.

Subsequent to the period ended June 30, 2014, the Company issued 600,000 restricted shares in connection with the exercise of 600,000 warrants during the period ended June 30, 2014.

The Company evaluated all other events and transactions that occurred subsequent to the balance sheet date and prior to the date on which the financial statements contained in this report were issued, and the Company determined that no such events or transactions necessitated.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS AND RESULTS OF OPERATION Back to Table of Contents

FORWARD-LOOKING STATEMENTS

Certain statements that the Company may make from time to time, including all statements contained in this report that are not statements of historical fact, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and the safe harbor provisions set forth in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements may be identified by words such as “plans,” “expects,” “believes,” “anticipates,” “estimates,” “projects,” “will,” “should,” and other words of similar meaning used in conjunction with, among other things, discussions of future operations, financial performance, product development and new product launches, market position and expenditures. The Company assumes no obligation to update any forward-looking statements. Additional information concerning factors which could cause differences between forward-looking statements and future actual results is discussed under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K, as filed with the SEC on March 31, 2014.

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help you understand our historical results of operations during the periods presented and our financial condition. This MD&A should be read in conjunction with our consolidated financial statements and the accompanying notes to consolidated financial statements, and contains forward-looking statements that involve risks and uncertainties. See section entitled “Forward-Looking Statements” above.

Executive Overview

We are a development stage company with limited operations and have no significant revenues from our business operations. There is substantial doubt that we can continue as an on-going business for the next twelve months. We do not anticipate that we will generate significant revenues until we enter into licensing agreements with additional online gaming servers, or web advertisers, to permit them to offer games of skill on our platform as part of their member services, or as part of their advertising campaign. Accordingly, we must raise cash from sources other than our operations in order to implement our marketing plan.

In our management's opinion, there is a potential demand for our technology which will enable online game service providers, and websites engaged in marketing efforts designed to increase traffic, to provide a platform offering financial rewards to winners of online competitive games of skill.

On July 10, 2011, we executed a license agreement with GT-SAT International S.A.R.L ("GT-SAT"), a corporation organized under the laws of Luxemburg.  Such license agreement granted GT-SAT a non-exclusive right to develop websites and offer online games based on our proprietary gaming platform in Europe, with an exclusive license to develop websites and offer online games based on our proprietary gaming platform in Luxembourg, Belgium, and Holland.  In consideration of such license, GT-SAT made an upfront, non-refundable, payment of $90,000 and has agreed to pay us royalties on future revenues. On December 26, 2011, GT-SAT terminated this agreement. The stated reason for termination was the economic situation in Europe.

On July 1, 2011, we executed a license agreement with Yanir Levin Ltd., an Israeli corporation.  Such license agreement granted the licensee a non-exclusive right to develop websites and offer online games based on our proprietary gaming platform in Asia, with an exclusive license to develop websites and offer online games based on our proprietary gaming platform in Israel.  In consideration of the license granted to the licensee, the licensee made an upfront, non refundable, payment of $29,000 and has agreed to pay us royalties on future revenues.

In April 2011, we raised $40,000 and issued 400,000 shares of our common stock to two non - US investors.  These transactions did not involve any underwriters, underwriting discounts or commissions, nor any public offering.  We believe these transactions were exempt from registration pursuant to Regulation S of the Securities Act.

On August 19, 2013, we disclosed that we had entered into a preliminary agreement (the "Preliminary Agreement") with BreedIT Israel and its founder, Dr. Oded Sagee, pursuant to which we agreed to acquire 66.67% of BreedIT Israel's capital stock. Subsequently, we were issued 200 shares of BreedIT Israel's capital stock ("Ordinary Shares") which represent 66.67% of BreedIT's outstanding Ordinary Shares with the founder, Dr. Oded Sagee owning the remaining 100 Ordinary Shares, representing 33.33% of the outstanding Ordinary Shares.

In connection with the Preliminary Agreement, we agreed with Dr. Sagee that prior to the execution of any definitive agreement, certain conditions had to be satisfied, including, but not limited to: (i) completion of due diligence reviews; (ii) obtaining requisite regulatory approvals; and (iii) the execution of the binding agreement by and between BreedIT Israel and a leading Israeli university granting BreedIT Israel the exclusive, world-wide license for a unique and highly sophisticated decision making software used for the purpose of advanced agriculture breeding (the "IDSS Software").
On October 21, 2013, we filed our Form 8-K report disclosing that the Registrant, BreedIT Israel and Dr. Sagee executed the definitive Share Purchase Agreement (the "SPA") which provided that we inject an initial investment of US$245,000 (the "Initial Investment") which the parties agreed should be sufficient to fund BreedIT Israel's operations during the ensuing twelve-month period. The Registrant and BreedIT Israel further agreed that the remaining US$755,000 of the US$1,000,000 investment amount be funded from time to time, based upon BreedIT Israel's financial needs during the twelve-month period. The closing of the SPA was subject to the execution of the binding License Agreement between BreedIT Israel and the leading Israeli academic institution (the "Licensor"), which closed on October 24, 2013.
Consideration for the purchase was paid by us through issuance of BreedIT Corp. Common Stock and Class A/B Options, the fair market value of the Tangible/Intangible Assets acquired, as of the valuation date, was determined to be $849,671 and the excess fair value of the assets over the fair value of the identifiable assets owned at closing of $630,880 was booked as goodwill. As the company is not generating income from the software sales and to ensure the asset is carried at no more than the recoverable amount, $630,880 or entire goodwill amount was impaired to expense during Q4 of 2013.

We believe that we have sufficient cash on hand to allow us to market our IDSS Software to potential clients and remain in business throughout 2014. If after that we are unable to generate significant revenues for any reason, or if we are unable to make a reasonable profit, we may have to suspend or cease operations.

Over the next twelve months, we plan to sell and/or license our IDSS Software to potential customers in the seed breeding market. We initially intend to sign agreements and to establish alliances with national and international major seed companies by providing them with access to knowledge and proprietary technology developed by researchers of various Universities.

Results of Operations during the three and six months ended June 30, 2014 as compared to the three and six months ended June 30, 2013

During the three and six months ended June 30, 2014 we generated revenues of $1,450 and $2,900 compared to $1,446 and $2,876, respectively, for the three and six months ended June 30, 2013. Our research and development expenses increased to $20,810 and $41,776 during three and six months ended June 30, 2014 compared to $0 and $0 during the same period in the prior year. The increase was due to developing BreedIT's SDSS system.

Our general and administrative expenses during the three and six months ended June 30, 2014 were $236,374 and $3,512,562 as compared to $21,545 and $44,952 during the same period in the prior year. The significant increase was due increased non-cash compensation to non-related and related parties. We incurred a net loss of $231,272 and $3,531,217 attributable to BreedIT Corp during three and six months ended June 30, 2014 compared to a net loss of $92,536 and $200,729 during the same period in the prior year.

Purchase or Sale of Equipment

Other than the purchase of servers, work stations and relevant literature, we do not expect to purchase or sell any plant or significant equipment.

Liquidity and Capital Resources

Our balance sheet as of June 30, 2014 reflects current assets of $2,500,333 consisting of cash and cash equivalents of $1,466,592, certificates of deposit of $1,023,058 and other receivables of $10,683. As of December 31, 2013, we had current assets of $656,110 consisting of cash and cash equivalents of $656,067 and restricted cash of $43.

As of June 30, 2014, we had total current liabilities of $244,232 consisting of $45,798 in accounts payable and accrued liabilities, $27,000 due to related parties, $5,800 in deferred revenues, $28,360 accrued interest payable and $137,274 in convertible notes payable, net of discount. As of June 30, 2014, we had $5,776 in long-term deferred revenues.

As of December 31, 2013, we had total current liabilities of $160,052 consisting of $59,574 in accounts payable and accrued liabilities, $2,305 due to related parties, $15,565 accrued interest payable, $5,800 in deferred revenues and $76,808 in convertible notes payable, net of discount. As of December 31, 2013, we had $8,676 in long-term deferred revenues.

We had positive working capital of $2,256,101 as of June 30, 2014 compared to positive working capital $496,058 at December 31, 2013. Such working capital has been sufficient to sustain our operations to date. Our total liabilities as of June 30, 2014 were $250,008 compared to $168,728 at December 31, 2013.

During the six months ended June 30, 2014, we used $1,416,113 in our operating activities. This resulted from a net loss of $3,601,745, increase in other assets of $1,023,015, decrease in account payable of $13,776, increase in other current assets of $10,683 and decrease in deferred revenues of $2,900 and offset principally by options issued for services of $2,594,209, expense related to non-cash compensation of $539,072, increase in accrued expenses of $12,795, increase in related parties payable of $24,695, amortization expenses related to debt discount of $64,466 and depreciation expense of $769.

During the six months ended June 30, 2013, we used $61,214 in our operating activities. This resulted from a net loss of $200,729, decrease in accounts payable and accrued expenses of $16,874, decrease in deferred revenue of $2,876 and the increase in related payables of $6,000, offset principally by $112,828 loss on trading securities, amortization expenses related to debt discount of $43,350, sale of investment in trading securities of $4,850, decrease in other assets of $4,082, and depreciation expense of $155.

During the six months ended June 30, 2014, we used $5,562 from investing activities which resulted from purchase of property and equipment, compared to cash generated from investing activities during three months ended June 30, 2013 of $49,324 which resulted from sale of trading securities.

During the six months ended June 30, 2014, we financed our negative cash flow from operations through the proceeds from exercise of warrants in the amount of $188,000 and from sale of common stock in the amount of $2,040,900 compared to borrowings on debt in the amount of $6,900 during the six months ended June 30, 2013.

While management of the Company believes that the Company will be successful in its current and planned operating activities, there can be no assurance that the Company will be successful in the achievement of sales of its products that will generate sufficient revenues to earn a profit and sustain the operations of the Company. The Company intends to conduct additional capital formation activities through the issuance of its common stock in 2014 unless and until we begin to generate revenues from our IDSS Software.

Our ability to create sufficient working capital to sustain us over the next twelve month period, and beyond, is dependent on our entering into additional licensing agreement and on our success in issuing additional debt or equity, or entering into strategic arrangement with a third party. There can be no assurance that sufficient capital will be available to us. We currently have no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

Going Concern Consideration

There is substantial doubt about our ability to continue as a going concern. Our financial statements contain additional note disclosures with respect to this matter.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Critical Accounting Policies

Basis of Presentation and Organization

Cash and Cash Equivalents

Restricted cash

Certificate of Deposit

Other Receivables

Revenue Recognition

Loss per Common Share

Income Taxes

Fair Value of Financial Instruments

Property and equipment:

Deferred Offering Costs

Impairment of Long-Lived Assets

Estimates

Fair value measurements

In determining fair value, the Company utilizes valuation techniques in its assessment that maximize the use of observable inputs and minimize the use of unobservable inputs.

The following table presents the Company's financial assets and liabilities that are carried at fair value, classified according to the three categories described above:

Fair Value Measurements at June 30, 2014
				Quoted Prices in Active		Significant Other		Significant
				Markets for Identical Assets		Observable Inputs		Unobservable Inputs		Gains
		Total		(Level 1)		(Level 2)		(Level 3)		(Losses)
Investment in Trading Securities	$	-	$	-	$	-	$	-	$	-
Total assets at fair value	$	-	$	-	$	-	$	-	$	-

Fair Value Measurements at December 31, 2013
				Quoted Prices in Active		Significant Other		Significant
				Markets for Identical Assets		Observable Inputs		Unobservable Inputs		Gains
		Total		(Level 1)		(Level 2)		(Level 3)		(Losses)
Investment in Trading Securities	$	-	$	-	$	-	$	-	$	(114,752)
Total assets at fair value	$	-	$	-	$	-	$	-	$	(114,752)

Impact of recently issued accounting standards

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Back to Table of Contents

None.

ITEM 4. CONTROLS AND PROCEDURES Back to Table of Contents

Evaluation of disclosure controls and procedures. As of June 30, 2014, the Company's chief executive officer and chief financial officer conducted an evaluation regarding the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act. Based upon the evaluation of these controls and procedures, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this report.

Changes in internal controls. During the quarterly period covered by this report, no changes occurred in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS Back to Table of Contents

We are not currently subject to any material legal proceedings, nor, to our knowledge, is any material legal proceeding threatened against us. However, from time to time, we may become a party to certain legal proceedings in the ordinary course of business.

ITEM 1A. RISK FACTORS Back to Table of Contents

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, “Item 1. Description of Business, subheading "Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2013, which could materially affect our business, financial condition or future results. The risks described in our Annual Report on Form 10-K are not the only risks facing our company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS Back to Table of Contents

On March 3, 2014 the Company issued 1,000,000 restricted shares of common stock in consideration for investor relations (IR) services provided to the Company. The shares were valued at $480,000 based on the closing price of the Company's common stock on the date of grant.
From January 23, 2014 to March 31, 2014 the Company sold to 10 non-US private accredited investors a total of 6,461,666 shares for cash consideration of $923,000 at an average price of $0.143.

From March 10, 2014 through March 31, 2014, the Company sold to 12 non-US private accredited investors, a total of 3,270,000 units for cash consideration of $667,750 at an average price of $0.204 (the "Units"), each unit comprised of one share of common stock, one class C warrant with 24 months term exercisable at a price of $0.35. The relative fair value of the stock with attached warrants was $189,300 for the common stock, $478,450 for class C warrants.

On February 24, 2014 and March 13, 2014, 3 share and warrant holders exercised warrants and were issued 1,144,262 shares for cash consideration of $48,000.

On February 18, 2014 the Company issued to Dr. Oded Sagee minority owner and founder of BreedIT Ltd., 2,200,000 shares of our common stock valued based on the closing market price on the acquisition date at $151,800; 2,200,000 Class A options for the purchase of 2,200,000 shares of our common stock at $0.055 per share valued using the black-scholes model with volatility of 122% and a discount rate of 0.23% for a total value of $84,967; and 2,200,000 Class B options for the purchase of 2,200,000 shares of our common stock at $0.065 per share valued using the black-scholes model with volatility of 122% and a discount rate of 0.23% for a total value of $84,680.

On April 1, 2014 and April 7, 2014 the Company sold to 2 private accredited investors, a total of 1,215,000 units for cash consideration of $250,150 at an average price of $0.206 (the "Units"), each unit comprised of one share of common stock, one class C warrant with 24 months term exercisable at a price of $0.35. The relative fair value of the stock with attached warrants was $61,984 for the common stock, $188,166 for class C warrants.

On May 8, 2014 the Company sold to 1 private accredited investor, a total of 666,667 units for cash consideration of $200,001 at a price of $0.30 (the "Units"), each unit comprised of one share of common stock, one class H warrant with 3 months term exercisable at a price of $0.30 and one class I warrant with 18 month term exercisable at price of $0.45. The relative fair value of the stock with attached warrants was $69,916 for the common stock, $130,085 for warrants.

On April 14, 2014 and on June 22, 2014 2 share and warrant holders exercised warrants for cash consideration of $140,000, in return 2,000,000 shares were issued and as of balance sheet date 600,000 shares are to be issued.

The Company believes that the issuances and sale of the restricted shares were exempt from registration pursuant to Section 4(2) of the Act as privately negotiated, isolated, non-recurring transactions not involving any public solicitation. The recipients in each case represented their intention to acquire the securities for investment only and not with a view to the distribution thereof. Appropriate restrictive legends are affixed to the stock certificates issued in such transactions. All recipients of restricted shares either received adequate information about the Company or had access, through employment, relation and/or business relationships with the Company to such information.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES Back to Table of Contents

None.

ITEM 4. MINE SAFETY DISCLOSURE. Back to Table of Contents

Not applicable.

ITEM 5. OTHER INFORMATION Back to Table of Contents

Not applicable.

ITEM 6. EXHIBITS Back to Table of Contents

(a) The following documents are filed as exhibits to this report on Form 10-Q or incorporated by reference herein. Any document incorporated by reference is identified by a parenthetical reference to the SEC filing that included such document.

Exhibit No.	Description
3.1	Articles of Incorporation (Incorporated by reference from our Registration Statement on Form S-1 filed on October 19, 2010).
3.1.1	Certificate of Amendment of Certificate of Incorporation (Incorporated by reference from our Periodic Report on Form 8-K filed on March 1, 2012).
3.2	Bylaws (Incorporated by reference from our Registration Statement on Form S-1 filed on October 19, 2010).
4.1	Specimen ordinary share certificate (Incorporated by reference from our Registration Statement on Form S-1 filed on October 19, 2010).
10.6	Preliminary Agreement between the Registrant, BreedIT and Oded Sagee dated August 15, 2013, filed with the Registrant's Form 8-K on August 19, 2013.
10.7	Share Purchase Agreement between the Registrant, BreedIT and Oded Sagee dated October 20, 2013, filed with the Registrant's Form 8-K on October 21, 2013.
31.1	Section 302 Certification of the Sarbanes-Oxley Act of 2002 of Yoel Yogev, filed herewith.
31.2	Section 302 Certification of the Sarbanes-Oxley Act of 2002 of Oded Gilboa, filed herewith.
32.1	Section 906 of the Sarbanes-Oxley Act of 2002 of Yoel Yogev, filed herewith
32.2	Section 906 of the Sarbanes-Oxley Act of 2002 of Oded Gilboa, filed herewith

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned.

BREEDIT CORP.
By: /s/ Yoel Yogev
Yoel Yogev
Chief Executive Officer and Director
(Principal Executive Officer)
Date: August 6, 2014

By: /s/ Oded Gilboa
Oded Gilboa
Chief Financial Officer
(Principal Financial and Principal Accounting Officer)
Date: August 6, 2014

Pursuant to the requirements of the Securities Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By: /s/ Yoel Yogev
Yoel Yogev
Chief Executive Officer and Chairman
(Principal Executive Officer)
Date: August 6, 2014

By: /s/ Oded Gilboa
Oded Gilboa
Chief Financial Officer
(Principal Financial and Principal Accounting Officer)
Date: August 6, 2014

By: /s/ Itschak Shrem, Chairman
Itschak Shrem
Chairman
Date: August 6, 2014