**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-Q**








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








**For
      The Quarterly Period Ended June 30, 2005**





Commission
      File No. **001-31354**





**IFT
                  Corporation***(Exact
                  name of Registrant as Specified in its
                  Charter)*
 
 **Delaware**
              
              **13-3545304***(State
                  of Incorporation)*
              
              *(I.R.S.
                  Employer Identification No.)***Quorum
                  Business Center****718
                  South Military Trail****Deerfield
                  Beach, Florida**
              
              **33442***(Address
                  of Principal Executive Offices)*
              
              *(Zip
                  Code)*
 
 **(954)
        428-7011**
 *(Registrant’s
        Telephone Number)*


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, and (2) has been subject to such filing requirements for
      the past 90 days. Yes þ No o




Indicate
      by check mark whether the registrant is an accelerated filer (as defined in
      Rule
      12b-2 of the Exchange Act). Yes o No þ





Indicate
      the number of shares outstanding of each of the issuer's classes of common
      stock, as of the latest practicable date.





As
      of
      July 20, 2005 there were 50,572,986 shares of Common Stock, par value $.01,
      outstanding.







**IFT
      CORPORATION**


**FORM
      10-Q**


**FOR
      THE QUARTER ENDED JUNE 30, 2005**


**INDEX**


**Page****PART
                  I  —****FINANCIAL
                  INFORMATION****Item
                  1.****Financial
                  Statements**
              **3****Item
                  2.****Management’s
                  Discussion and Analysis of Financial
                  Condition and Results of Operations**
              **10****Item
                  3.****Quantitative
                  and Qualitative Disclosures About Market
                  Risk**
              **14****Item
                  4.****Controls
                  and Procedures**
              **14****PART
                  II  —****OTHER
                  INFORMATION****Item
                  1.****Legal
                  Proceedings**
              **14****Item
                  2.****Unregistered
                  Sales of Equity Securities and Use of
                  Proceeds**
              **15****Item
                  3.****Defaults
                  Upon Senior
                  Securities**
              **15****Item
                  4.****Submission
                  of Matters to a Vote of Security
                  Holders**
              **15****Item
                  5.****Other
                  Information**
              **15****Item
                  6.****Exhibits**
              **15****SIGNATURES**
              **16****INDEX
                  OF EXHIBITS**
              **17**


2
 *Index*


**PART
      I — FINANCIAL INFORMATION**





**Item
                  1.**
              **Financial
                  Statements.**




**IFT
      CORPORATION**


**INDEX
      TO FINANCIAL STATEMENTS AND**


**FINANCIAL
      STATEMENT SCHEDULES**





**CONDENSED
                CONSOLIDATED BALANCE
                SHEETS****June
                30, 2005 (Unaudited) and December 31,
                2004**
            **4****CONDENSED
                CONSOLIDATED STATEMENTS OF OPERATIONS
                (UNAUDITED)****Three
                and Six Months Ended June 30, 2005 and
                2004**
            **5****CONDENSED
                CONSOLIDATED STATEMENTS OF CASH FLOWS
                (UNAUDITED)****Six
                Months Ended June 30, 2005 and
                2004**
            **6****NOTES
                TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                (UNAUDITED)**
            **7**




**All
      schedules for which provision is made in the applicable accounting regulations
      of the Securities and Exchange Commission are not required under the related
      instructions or are not applicable, and therefore have been
      omitted.**


3
 *Index*


**IFT
      CORPORATION**


**CONDENSED
      CONSOLIDATED BALANCE SHEETS**





**June
                30,**
            
            **December
                31,****2005**
            
            **2004****(Unaudited)****ASSETS**Current
                Assets:Cash
            
            $
            112,176
            
            $
            24,903Accounts
                Receivable (Net of Allowance For Doubtful Accounts of $126,490 and
                $74,339
                at June 30, 2005 and December 31, 2004, respectively)
            
            
            3,368,755
            
            
            630,408Inventory
                (Note 4 )
            
            
            807,399
            
            
            249,039Prepaid
                Expenses and Other Current Assets
            
            
            108,791
            
            
            41,053Total
                Current Assets
            
            
            4,397,121
            
            
            945,403Property,
                Plant and Equipment, Net
            
            
            573,581
            
            
            287,784Other
                Assets:Intangibles
            
            
            2,158,707
            
            
            774,000Deposits
                and Other Non-Current Assets
            
            
            195,573
            
            
            56,470Total
                Other Assets
            
            
            2,354,280
            
            
            830,470Total
                Assets
            
            $
            7,324,982
            
            $
            2,063,657**LIABILITIES
                AND STOCKHOLDERS’ (DEFICIT)**Current
                Liabilities:Accounts
                Payable and Accrued Expenses
            
            $
            4,269,247
            
            $
            1,654,820Lines
                of Credit (Note 5 )
            
            
            599,975
            
            
            719,070Loans
                Payable - Related Party (Note 6 )
            
            
            4,279,408
            
            
            5,670,000Notes
                Payable - Other (Note 7)
            
            
            500,000
            
            
            ---Current
                Maturities of Long-Term Debt
            
            
            45,675
            
            
            22,398Current
                Maturity of Long-Term Capital Lease
            
            
            2,461
            
            
            2,184Commitments
                and Contingencies (Note 12 )
            
            
            845,397
            
            
            1,203,601Total
                Current Liabilities
            
            
            10,567,636
            
            
            9,272,073Long-Term
                Debt
            
            
            144,104
            
            
            11,284Long-Term
                Capitalized Lease
            
            
            1,505
            
            
            2,959Total
                Liabilities
            
            
            10,713,245
            
            
            9,286,316Stockholders’
                (Deficit):Preferred
                Stock, $1.00 Par Value; 2,000,000 Shares Authorized, of which
                Designations:Series
                A Convertible, 750,000 Shares Authorized; 62,500 Issued and Outstanding
                atJune
                30, 2005 and December 31, 2004; aggregate liquidation preference
                at June
                30,
                2005 and December 31, 2004 of $62,500
            
            
            55,035
            
            
            55,035Common
                Stock, $.01 Par Value; 60,000,000 Shares Authorized; 50,564,986 and
                32,014,369 Issued and Outstanding at June 30, 2005 and December 31,
                2004,
                Respectively
            
            
            505,650
            
            
            320,143Additional
                Paid-In Capital
            
            
            59,810,270
            
            
            53,625,390Accumulated
                (Deficit)
            
            
            (63,733,745
            )
            
            (61,223,227
            )Total
                Stockholders’ (Deficit)
            
            
            (3,388,263
            )
            
            (7,222,659
            )Total
                Liabilities and Stockholders’ (Deficit)
            
            $
            7,324,982
            
            $
            2,063,657





See
      accompanying notes to condensed consolidated financial
      statements.


4
 *Index*


**IFT
      CORPORATION**


**CONDENSED
      CONSOLIDATED STATEMENTS OF
      OPERATIONS**


**(UNAUDITED)**





**Three
                Months Ended June 30,**
            
            **Six
                Months Ended June 30,****2005**
            
            **2004**
            
            **2005**
            
            **2004**Revenue:Coatings,
                Sealants and Other Products
            
            $
            5,206,176
            
            $
            586,629
            
            $
            7,663,829
            
            $
            1,047,527Total
                Revenue
            
            
            5,206,176
            
            
            586,629
            
            
            7,663,829
            
            
            1,047,527Cost
                of Sales:Coatings,
                Sealants and Other Products
            
            
            4,099,814
            
            
            436,899
            
            
            6,172,044
            
            
            779,575Warranty
                Costs, Freight and Other Cost of Sales
            
            
            ---
            
            
            11,491
            
            
            31,872
            
            
            19,338Total
                Cost of Sales
            
            
            4,099,814
            
            
            448,390
            
            
            6,203,916
            
            
            798,913Gross
                Profit
            
            
            1,106,362
            
            
            138,239
            
            
            1,459,913
            
            
            248,614Operating
                Expenses:Selling,
                General and Administrative
            
            
            1,736,348
            
            
            795,052
            
            
            2,975,319
            
            
            1,323,004Professional
                Fees
            
            
            126,723
            
            
            151,373
            
            
            393,218
            
            
            265,520Depreciation
                and Amortization
            
            
            31,830
            
            
            21,298
            
            
            58,265
            
            
            41,669Consulting
                Fees
            
            
            64,010
            
            
            60,780
            
            
            125,392
            
            
            70,993Interest
                Expense
            
            
            57,132
            
            
            95,986
            
            
            113,623
            
            
            139,287Other
                Income
            
            
            (19,978
            )
            
            ---
            
            
            (19,978
            )
            
            ---Total
                Operating Expenses
            
            
            1,996,065
            
            
            1,124,489
            
            
            3,645,839
            
            
            1,840,473Operating
                (Loss)
            
            
            (889,703
            )
            
            (986,250
            )
            
            (2,185,926
            )
            
            (1,591,859
            )Income
                (Loss) From Discontinued Operations
            
            
            2,514
            
            
            (569,251
            )
            
            (324,591
            )
            
            (1,654,180
            )Net
                (Loss)
            
            $
            (887,189
            )
            $
            (1,555,501
            )
            $
            (2,510,517
            )
            $
            (3,246,039
            )Net
                (Loss) Per Share-Basic and Diluted:Continuing
                Operations
            
            $
            (0.018
            )
            $
            (0.034
            )
            $
            (0.044
            )
            $
            (0.055
            )Discontinued
                Operations
            
            
            0.000
            
            
            (0.020
            )
            
            (0.006
            )
            
            (0.058
            )Total
                Net (Loss)
            
            $
            (0.018
            )
            $
            (0.054
            )
            $
            (0.050
            )
            $
            (0.113
            )Weighted
                Average Shares Outstanding
            
            
            50,306,865
            
            
            28,735,928
            
            
            50,252,462
            
            
            28,784,466





See
      accompanying notes to condensed consolidated financial
      statements.


5
 *Index*


**IFT
      CORPORATION**


**CONDENSED
      CONSOLIDATED STATEMENTS OF CASH
      FLOWS**


**(UNAUDITED)**





**Six
                  Months Ended June 30,****2005**
              
              **2004**CASH
                  FLOWS FROM OPERATING ACTIVITIES:Net
                  (Loss)Continuing
                  Operations
              
              $
              (2,185,926
              )
              $
              (1,591,859
              )Discontinued
                  Operations
              
              
              (324,591
              )
              
              (1,654,180
              )Adjustments
                  to Reconcile Net (Loss) to Net Cash Provided (Used) by Operating
                  Activities:Depreciation
                  and Amortization
              
              
              58,265
              
              
              41,668(Gain)
                  Loss on Disposition of Machinery and Equipment
              
              
              (2,657
              )
              
              ---(Increase)
                  Decrease In Operating Assets:Accounts
                  Receivable
              
              
              (1,226,135
              )
              
              74,801Notes
                  Receivable
              
              
              ---
              
              
              15,936Inventory
              
              
              (246,790
              )
              
              14,765Prepaid
                  Expenses and Other Current Assets
              
              
              (12,364
              )
              
              (378,677
              )Increase
                  (Decrease) In Operating Liabilities:Accounts
                  Payable and Accrued Expenses
              
              
              1,828,563
              
              
              (483,580
              )Accounts
                  Payable and Accrued Expenses - Related Party
              
              
              83,608
              
              
              83,405Commitments
                  and Contingencies
              
              
              (358,204
              )
              
              ---Net
                  Cash (Used) In Operating Activities
              
              
              (2,386,231
              )
              
              (3,877,721
              )CASH
                  FLOWS FROM INVESTING ACTIVITIES:(Acquisition)
                  of Machinery and Equipment
              
              $
              (313,873
              )
              $
              (82,900
              )(Acquisition)
                  of Business Entity
              
              
              (2,000,000
              )
              
              ---Proceeds
                  From Disposition of Machinery and Equipment
              
              
              18,385
              
              
              57,357(Increase)
                  in Deposits and Other Non-Current Assets
              
              
              (136,835
              )
              
              27,803Net
                  Cash Provided (Used) by Investing Activities
              
              
              (2,432,323
              )
              
              2,260CASH
                  FLOWS FROM FINANCING ACTIVITIES:Proceeds
                  from Notes Payable - Other
              
              
              500,000
              
              
              ---Proceeds
                  from Loans Payable - Related Party
              
              
              4,302,500
              
              
              3,950,000Proceeds
                  from Notes and Lines of Credit
              
              
              182,513
              
              
              7,789(Payments)
                  of Notes and Lines of Credit
              
              
              (120,135
              )
              
              (6,600
              )(Payments)
                  of Capital Lease Obligations
              
              
              (1,176
              )
              
              (915
              )(Payments)
                  of Long Term Debt
              
              
              (26,050
              )
              
              (20,135
              )Net
                  Cash Provided By Financing Activities
              
              $
              4,837,652
              
              $
              3,930,139Net
                  Increase In Cash
              
              
              19,098
              
              
              54,678Cash
                  at Beginning of Period
              
              
              93,079
              
              
              42,718Cash
                  at End of Period
              
              $
              112,177
              
              $
              97,396Supplemental
                  Disclosure of Cash Flow Information:Cash
                  Payments for Interest
              
              $
              30,015
              
              $
              32,641Non-Cash
                  Investing Activities:Machinery
                  and Equipment acquired via Capital Lease Obligation
              
              $
              ---
              
              $
              7,200Non-Cash
                  Financing Activities:Issuance
                  of Common Stock Pursuant to Employment Agreements
              
              
              5,600
              
              
              8,574Issuance
                  of Common Stock for Acquisition of Business Entity
              
              
              22
              
              
              ---Extinguishment
                  of Common Stock Pursuant to Settlement Agreement
              
              
              ---
              
              
              (131,508
              )Issuance
                  of Common Stock for Accrued Liabilities and Fractional Shares that
                  resulted from the Conversion of Series C Preferred Stock
              
              
              ---
              
              
              1,170Compensation
                  Expense for Share-Based Payments under SFAS No. 123R
              
              
              25,474
              
              
              ---Issuance
                  of Common Stock Pursuant to Director Compensation Plan for Director
                  Fees
              
              
              342,890
              
              
              251,820Issuance
                  of Common Stock Pursuant to Conversion of Series C Preferred
                  Stock
              
              
              ---
              
              
              673,145Issuance
                  of Common Stock for Cancellation of Indebtedness
              
              
              6,000,000
              
              
              ---Total
                  Non-Cash Financing Activities
              
              $
              6,373,986
              
              $
              803,201
  See
        accompanying notes to condensed consolidated financial
        statements.


6
 *Index*


**IFT
      CORPORATION**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL
      STATEMENTS**


**(UNAUDITED)**




**Note
                1.**
            **Basis
                of Presentation.**





In
      the
      opinion of management, the accompanying unaudited condensed consolidated
      financial statements contain all adjustments necessary (consisting only of
      normal recurring accruals) to present fairly the financial information contained
      therein. These statements do not include all disclosures required by accounting
      principles generally accepted in the United States of America (GAAP) for
      annual periods and should be read in conjunction with the Company’s audited
      consolidated financial statements and related notes for the year ended
      December 31, 2004. The Company prepared the condensed consolidated
      financial statements following the requirements of the rules promulgated by
      the
      Securities and Exchange Commission for interim reporting. As permitted under
      those rules, certain footnotes or other financial information that are normally
      required by GAAP can be condensed or omitted. The results of operations for
      the
      six months ended June 30, 2005 are not necessarily indicative of the results
      to
      be expected for the year ending December 31, 2005 or any other period(s).
      Certain reclassifications of prior year amounts have been made to conform to
      the
      current year presentation.





**Note
                2.**
            **Recently
                Adopted Accounting
                Standards.**





In
      December 2004, Statement of Financial Accounting Standards No. 123
      (revised 2004), *Share-Based
      Payment* (SFAS
      No. 123R), was issued. SFAS No. 123R is effective for entities that do
      not file as small business issuers as of the beginning of the first fiscal
      year
      that begins after June 15, 2005, which is the Company’s first fiscal
      quarter of 2006. SFAS No. 123R requires companies to recognize in the
      income statement the grant-date fair value of stock options and other
      equity-based compensation issued to employees. SFAS No. 123R sets
      accounting requirements for measuring, recognizing and reporting share-based
      compensation, including income tax considerations. In general, SFAS
      No. 123R does not express a preference for a type of valuation model for
      measuring the grant date fair value, generally requires equity- and
      liability-classified awards to be recognized in earnings over the requisite
      service period, generally the vesting period for service condition awards,
      allows for a one-time policy election regarding one of two alternatives for
      recognizing compensation cost for grant awards with graded vesting, and requires
      the use of the estimated forfeitures method. Notwithstanding the fact that
      the
      Company is considered a small business issuer, the Company has elected to begin
      reporting under SFAS No. 123R and will begin recognizing the cost of
      equity-based compensation using the modified prospective application method,
      whereby the cost of new awards and awards modified, repurchased or cancelled
      after the required effective date and the portion of awards for which the
      requisite service has not been rendered (unvested awards) that are outstanding
      as of the required effective date will be recognized as the requisite service
      is
      rendered on or after the required effective date.





**Note
                3.**
            **Going
                Concern.**





While
      the
      accompanying unaudited condensed consolidated financial statements have been
      prepared on a going concern basis, which contemplates the realization of assets
      and liquidation of liabilities during the normal course of operations, certain
      adverse conditions and events cast substantial doubt upon the validity of this
      assumption. The Company has experienced significant recurring operational losses
      and negative cash flows from operations, and at June 30, 2005 has an accumulated
      deficit, net of dividends, of $63,733,745, a working capital deficit of
      $6,145,041 and its total liabilities exceeded its total assets by $3,362,789.
      These factors raise doubt about the Company’s ability to continue as a going
      concern. The Company has relied principally on non-operational sources of
      financing, mainly from Richard J. Kurtz, Chairman of the Board (“Chairman”), to
      fund its operations for approximately seven years. Although the Company had
      no
      formal commitment from the Chairman to fund the Company’s operating requirements
      for the 2005 year, the Company received short term demand loans, during the
      period January 1, 2005 through June 30, 2005, aggregating $4,302,500 from the
      Chairman, of which $2,000,000 was for the acquisition of LaPolla Industries,
      Inc. on February 11, 2005 (“LaPolla”), and the remaining $2,302,500 for
      operational costs and other corporate purposes. The Company’s ability to
      continue as a going concern will be dependent on management’s ability to
      successfully execute its business plan, which includes increasing revenues
      while
      decreasing operating costs and expenses, as well as, increasing operational
      cash
      flow, continued support from the Chairman, and obtaining additional funding
      to
      support longer term capital requirements. If management in unsuccessful is
      obtaining one or more of the above mentioned goals, the Company’s ability to
      continue as a going concern would be adversely impacted. These financial
      statements do not include adjustments or disclosures that may result from the
      Company’s inability to continue as a going concern. ***See
      also*** Note 6.
      Notes Payable - Other.





**Note
              4.**
            **Inventories.**





Components
      of Inventories were:




**June
                30,**
              **2005**
            
            **December
                31,**
              **2004**Raw
                Materials
            
            $
            440,473
            
            $
            61,258Finished
                Goods
            
            
            366,926
            
            
            187,781Total
            
            $
            807,399
            
            $
            249,039


7
 *Index*


**IFT
      CORPORATION**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**(UNAUDITED)**





**Note
                5.**
            **Lines
                of Credit.**





Lines
      of
      Credit are comprised of the following:




**June
                30,**
              **2005**
            
            **December
                31,**
              **2004**$180,000
                Line of Credit, maturing February 1, 2006, bears interest at prime
                plus 1%
                per annum, secured by all the assets of LaPolla Industries, Inc.
                and a
                personal guarantee from the Chairman of the Board.
            
            $
            100,057
            
            $
            219,152$500,000
                Line of Credit, maturing January 1, 2006, bears interest at a floating
                prime rate per annum, secured by all of the assets of IFT Corporation
                and
                the Chairman of the Board as a co-borrower.
            
            
            499,918
            
            
            499,918Total
                of Lines of Credit
            
            $
            599,975
            
            $
            719,070





**Note
                6.**
            **Loans
                  Payable - Related
                  Party.**




Loans
      payable - related party is comprised of funds
      loaned to the Company, for working capital and other corporate purposes, from
      the Chairman. These loans are payable upon demand, unsecured and bear interest
      at 9% per annum through December 31, 2004, and at 6% per annum for the six
      months ended June 30, 2005. During the period from January 1, 2005 to June
      30,
      2005 the Chairman loaned the Company funds aggregating $4,302,500, $2,000,000
      of
      which was used for the purchase of LaPolla.




**Note
                7.**
            **Notes
                Payable - Other.**




On
        June
        2, 2005, the Company and the Chairman signed a Promissory Note with a national
        institution granting access to funds in the amount of $2,000,000, which may
        be
        drawn against from time to time for the operations of the Company. During
        the
        second quarter, the Company accessed $500,000, which represents the balance
        as
        of June 30, 2005. The Note bears interest at a rate equal to 1-month LIBOR
        plus
        two and one-quarter percent (2.25) per annum (“LIBOR-Based Rate”), and has a
        maturity date of June 1, 2006.


**Note
                8.**
            **(Loss)
                Per Share - Basic and
                Diluted.**





The
      table
      below presents the computation of basic and diluted (loss) per
      share:





**Three
                Months Ended June 30,**
            
            **Six
                Months Ended June 30,****2005**
            
            **2004**
            
            **2005**
            
            **2004**Net
                (Loss):Continued
                Operations
            
            $
            (889,703
            )
            $
            (986,250
            )
            $
            (2,185,926
            )
            $
            (1,591,859
            )Discontinued
                Operations
            
            $
            2,514
            
            $
            (569,251
            )
            $
            (324,591
            )
            $
            (1,654,180
            )Total
                Net (Loss)
            
            $
            (887,189
            )
            $
            (1,555,501
            )
            $
            (2,510,517
            )
            $
            (3,246,039
            )Diluted
                Shares
            
            
            50,306,865
            
            
            28,735,928
            
            
            50,252,462
            
            
            28,784,466(Loss)
                Per Share-Basic and Diluted
            
            
            (0.018
            )
            
            (0.054
            )
            
            (0.050
            )
            
            (0.113
            )





Basic
      and
      diluted net loss per share are the same since (a) the Company has reflected
      net
      losses from continuing operations for all periods presented and (b) the
      potential issuance of shares of the Company would be anti-dilutive.





**Note
                9.**
            **Discontinued
                Operations.**





On
      November 5, 2004, the Company discontinued the operations of its RSM
      Technologies, Inc. business. RSM Technologies, Inc. consisted of two products
      lines: Application Systems and Coatings. The consolidated financial statements
      and the related notes contained herein have been recast to reflect the financial
      position, results of operations and cash flows of RSM Technologies, Inc. as
      a
      discontinued operation.





**Note
                10.**
            **Merger
                of Subsidiary.**





Effective
      April 1, 2005, Infiniti Products, Inc. (“Infiniti”), a Florida corporation,
      merged with and into LaPolla Industries, Inc., an Arizona corporation, whereupon
      the separate existence of Infiniti ceased and LaPolla continued as the surviving
      corporation.


8
 *Index*


**IFT
      CORPORATION**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**(UNAUDITED
      - CONTINUED)**





**Note
                11.**
            **Business
                Segment Information.**





Statement
      of Financial Accounting Standards No. 131, “Disclosures about Segments of an
      Enterprise and Related information,” requires disclosure of net profit or loss,
      certain specific revenue and expense items and certain asset items by reportable
      segments and how reportable segments are determined. This statement defines
      a
      reportable segment as a component of an entity about which separate financial
      information is produced internally, that is evaluated by the chief
      decision-maker to assess performance and allocate resources.





Effective
      April 1, 2005, the Company determined that it had two distinct business
      segments. These two business segments were defined as Corporate and LaPolla
      Products. On April 1, 2005, the Company’s Infiniti subsidiary merged with and
      into the LaPolla subsidiary and, therefore, the Infiniti Products business
      segment has been combined with and into the LaPolla Products segment. On
      November 5, 2004, the Company discontinued the operations of its RSM
      Technologies, Inc. subsidiary and, therefore, the RSM Products business segment
      has been eliminated. The business segment financial data reflected in the table
      below was derived from the Company’s condensed consolidated financial position
      and condensed consolidated results of operations as follows:


(i)
                Corporate
                    was derived from the financial data of IFT Corporation;
                    and
 (ii)
                LaPolla Products was derived from the financial
                  data of
                  LaPolla Industries, Inc.


The
      following table reflects certain business segment financial data as of and
      for
      the six months ended June 30, 2005:





**Corporate**
            
            **LaPolla
                Products**
            
            **Total**Revenue
            
            $
            ---
            
            $
            7,663,829
            
            $
            7,663,829Gross
                Profit
            
            $
            ---
            
            $
            1,459,913
            
            $
            1,459,913Operating
                (Loss)
            
            $
            (1,511,638
            )
            $
            (674,288
            )
            $
            (2,185,926
            )Capital
                Expenditures (Net of Capital Leases)
            
            $
            12,021
            
            $
            256,242
            
            $
            268,263Depreciation
                and Amortization Expense
            
            $
            33,649
            
            $
            24,616
            
            $
            58,265Identifiable
                Assets
            
            $
            3,008,858
            
            $
            4,316,124
            
            $
            7,324,982





The
      table
      above does not include any financial data relating to the discontinued RSM
      Products business segment, which is reported as discontinued operations in
      the
      Company’s financial statements.





**Note
                12.**
            **Commitments
                and Contingencies.**





**Litigation**





*(a)*
            *Plymouth
                Industries, Inc. vs. Urecoats Industries Inc,. Urecoats Manufacturing,
                Inc., et. al., Defendants*





The
      litigation between Plymouth Industries, Inc., Plaintiff, and Urecoats Industries
      Inc. and its wholly-owned subsidiaries Urecoats Manufacturing, Inc. and Urecoats
      Technologies, Inc. and Richard J. Kurtz, Defendants, has been settled pursuant
      to a Court approved Confidential Settlement Agreement, wherein none of the
      parties admitted liability or made any admissions with respect to the
      allegations or claims made in the litigation.





*(b)*
            V*arious
                Lawsuits and Claims Arising in the Ordinary Course of
                Business*





The
      Company is involved in various lawsuits and claims arising in the ordinary
      course of business, which are, in the opinion of the Company’s management,
      immaterial both individually and in the aggregate with respect to the Company’s
      consolidated financial position, liquidity or results of
      operations.





Because
      of the uncertainties related to the incurrence, amount and range of loss on
      any
      pending litigation or claim, management is currently unable to predict the
      ultimate outcome of any litigation or claim. In view of the unpredictable nature
      of such matters, we cannot provide any assurances regarding the outcome of
      any
      litigation or claim to which the Company is a party or the impact on the Company
      of an adverse ruling in such matters.


9
 *Index*


**IFT
      CORPORATION**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**(UNAUDITED
      - CONTINUED)**





**Note
                12.**
            **Commitments
                and Contingencies
                (continued).**





**Reserve**





The
      following is a summary of the reserve established for commitments and
      contingencies:





**June
                30,**
              **2005**
            
            **December
                31,**
              **2004**Accounts
                Payable and Accrued Expenses for Discontinued Operations
            
            $
            305,397
            
            $
            663,601Reserve
                for Litigation
            
            
            540,000
            
            
            540,000Total
            
            $
            845,397
            
            $
            1,203,601





**Note
                13.**
            **Subsequent
                Events.**





The
      Company accessed $250,000 from the Note in order to ensure various key vendors
      were paid within certain time frames. ***See*** Note 6.
      Notes Payable - Other. These vendors have recently granted price discounts
      to
      the Company based on the Company paying within these pre-designated
      guidelines.





**IFT
      CORPORATION**





**Item
                2.**
            **Management’s
                Discussion and Analysis of Financial Condition and Results of
                Operations.**





**MANAGEMENT’S
      DISCUSSION AND ANALYSIS**


**OF
      FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE QUARTER ENDED JUNE 30,
      2005**





As
      used
      in this report, "IFT" and the "Company" or "Us" or "We" or “Our” refer to IFT
      Corporation and its subsidiaries, unless the context otherwise requires. The
      financial review below presents our operating results for the three and six
      months ended June 30, 2005 and 2004, and our financial condition at June 30,
      2005. Except for the historical information contained herein, the following
      discussion contains forward-looking statements, which are subject to known
      and
      unknown risks, uncertainties and other factors that may cause our actual results
      to differ materially from those expressed or implied by such forward-looking
      statements. We discuss such risks, uncertainties and other factors throughout
      this report and specifically under the caption “Forward Looking Statements”
below. In addition, the following review should be read in connection with
      the
      information presented in our unaudited condensed consolidated financial
      statements and related notes for the three and six months ended June 30,
      2005.





*Overview*





We
      are a
      publicly traded holding company focused on acquiring and developing companies
      that operate in the coatings, paints, foams, sealants, and adhesives markets.
      Effective April 1, 2005, our wholly-owned subsidiary, Infiniti Products, Inc.
      (“Infiniti”), a Florida corporation, which marketed, sold, manufactured and
      distributed acrylic roof coatings, roof paints, sealers, and roofing adhesives
      to the home improvement retail and polyurethane foam systems to the
      industrial/commercial construction industries (“Infiniti Products”), merged with
      and into our wholly-owned subsidiary, LaPolla Industries, Inc. (“LaPolla”), an
      Arizona corporation, whereupon the separate existence of Infiniti ceased and
      LaPolla continued as the surviving corporation. IFT acquired 100% of the capital
      stock of LaPolla for $2 Million in cash and stock on February 11, 2005. LaPolla
      markets, sells, manufactures and distributes acrylic roof coatings, sealers,
      and
      polyurethane foam systems to the commercial construction and roof paints and
      roofing adhesives to the home improvement retail industries (“LaPolla
      Products”). The LaPolla name has been recognized in the Southwestern United
      States for over 27 years by roofing contractors, building owners and design
      professionals. We are continuing to expand our reach with a nationwide sales
      and
      marketing program to ensure development and execution of a consistent marketing
      strategy for our LaPolla Products in all geographic regions that share similar
      distribution channels and customers. Our sales offices are located in The
      Woodlands, Texas, Atlanta, Georgia, Camarillo, California, and Mount Holly
      Springs, Pennsylvania. LaPolla operates two manufacturing plants located in
      Tempe, Arizona and Deerfield Beach, Florida. A third manufacturing plant is
      scheduled to open during the third quarter of 2005. The basic assets of LaPolla
      include manufacturing equipment, product formulations, raw material and finished
      goods inventory, long term employees, customers, and vendors, office equipment,
      accounts receivable, and goodwill. On November 5, 2004, pursuant to resolution
      of the Board of Directors, we discontinued the operations of our RSM
      Technologies, Inc. subsidiary. Our condensed consolidated financial statements
      and related notes have been recast to reflect the financial position, results
      of
      operations and cash flows of RSM Technologies, Inc. as a discontinued
      operation.


10
 *Index*


**Results
      of Operations**





We
      operated our business on the basis of two reportable segments, which we refer
      to
      as Corporate and LaPolla Products, during the second quarter of 2005. LaPolla
      Products are collectively referred to as “Coatings, Sealants and Other Products”
in our condensed consolidated financial statements for this reporting period.
      The following table compares 2005 and 2004 revenue for the three and six month
      periods ended June 30, 2005 and 2004:





**Three
                Months Ended June 30,**
            
            **Six
                Months Ended June 30,****2005**
            
            **2004**
            
            **2005**
            
            **2004**Revenue:Coatings,
                Sealants and Other Products
            
            $
            5,206,176
            
            $
            586,629
            
            $
            7,663,829
            
            $
            1,047,527Total
                Revenue
            
            $
            5,206,176
            
            $
            586,629
            
            $
            7,663,829
            
            $
            1,047,527





The
      $4,619,547 or 787% increase in revenue for the three months ended June 30,
      2005
      compared to the same 2004 period was primarily the result of an increase in
      our
      sales volumes due to strong demand for our LaPolla Products in our target
      markets. The increase in revenue of $6,616,302, which represents an increase
      of
      632% in revenue for the six months ended June 30, 2005 as compared to the six
      months ended June 30, 2004 was due primarily to sales recognized from and after
      our acquisition of LaPolla, Infiniti sales prior to merging with LaPolla, and
      an
      increase in our sales volumes due to strong demand for our LaPolla
      Products.





Our
      cost
      of sales for the three months ended June 30, 2005 was $4,099,814 as compared
      to
      $448,390 for the three months ended June 30, 2004. The increase in the total
      cost of sales of $3,651,424 was primarily due to increased purchases of the
      raw
      materials required to manufacture our LaPolla Products to support our
      substantial growth in revenue. The cost of sales as a percentage of our revenue
      was 79% **** for
      the
      three months ended June 30, 2005 as compared to 76% for the same 2004
      period. This 3%
      increase in cost of sales as a percentage of revenue from the comparable 2004
      period is attributable to the product margin mix resulting from integration
      of
      the LaPolla Products and Infiniti Products. The $5,405,003 increase in cost
      of
      sales for the six months ended June 30, 2005 compared to the same 2004 period
      was primarily attributable to costs of raw materials and other costs of sales
      for the LaPolla Products from and after the acquisition of LaPolla, costs of
      raw
      materials and other costs of sales related to Infiniti’s products prior to
      merging with LaPolla, and increased purchases of raw materials required to
      manufacture our LaPolla Products to support our substantial growth in revenue
      during the second quarter of 2005. The cost of sales as a percentage of our
      revenue was 81% **** for
      the
      six months ended June 30, 2005 as compared to 76% for the same 2004
      period. This 5%
      increase in cost of sales as a percentage of revenue from 2004 is attributable
      to the product margin mix resulting from integration of the LaPolla Products
      and
      Infiniti Products, in addition to competition in the market place. The 81%
      cost
      of sales percentage for the six months ended June 30, 2005 is a combination
      of
      the 79% cost of sales percentage for the three months ended June 30, 2005 and
      the 86% cost of sales percentage for the three months ended March 31, 2005.
      The
      high cost of sales percentage has decreased significantly from the 86% cost
      of
      sales reported in the first quarter of 2005, which was mainly attributable
      to
      former unprofitable customers concerning which we either continue to increase
      sales prices or eliminate the relationship.





Gross
      profit as a percentage for the second quarter of 2005 was 21.3% of revenue,
      which represents a 2.3 percentage point decrease from the 23.6% rate for the
      second quarter of 2004. Our gross profit percentage decreased in the second
      quarter of 2005 compared to the second quarter of 2004 primarily as a result
      of
      an increase in sales of lower margin products as compared to higher margin
      products. The gross profit percentage decreased in the first six months of
      2005
      compared to the six months ended June 30, 2004, primarily due to the same
      reasons discussed above in the analysis of the second quarter 2005 decrease
      in
      the gross profit percentage. Gross profit for the second quarter of 2005 was
      $1,106,362, or 21.3% as a percentage of revenue, as compared to gross profit
      for
      the first quarter of 2005 which was $353,551, or 14.3% as a percentage of
      revenue. This 7% increase in gross profit was mainly attributable to an
      increased focus on our selling prices to our customer base, adjustments in
      our
      selling prices and elimination of unprofitable customer
      relationships.





Selling,
      general and administrative, or SG&A, expenses were $1,736,348, or 33.4% of
      revenue, in the second quarter of 2005 compared to $795,052, or greater than
      100% of revenue, in the second quarter of 2004. SG&A expenses for the first
      six months of 2005 were $2,975,319, or 38.8% of revenue, compared to $1,323,004,
      or greater than 100% of revenue, in the comparable 2004 period. The increase
      in
      SG&A expense dollars was a result of higher selling and marketing expenses
      supporting our increase in revenue, the addition of new sales personnel in
      California and Pennsylvania, an increase in promotion and advertising
      expenditures, investor relations and American Stock Exchange fees, sales travel
      expenses to obtain new and maintain existing customers, opening a new sales
      office in Camarillo, California and Mount Holly Springs, Pennsylvania, various
      insurance coverage increases due to the increase in revenues, opening two
      warehouses in Georgia and New Mexico, and non-cash stock compensation to
      officers and directors.





Professional
      fees consist of accounting, auditing, and legal fees. Our professional fees
      for
      the three months ended June 30, 2005 were $126,723 as compared to $151,373
      for
      the three months ended June 30, 2004. The decrease of $24,650 was primarily
      due
      to a decrease in attorney’s fees for past and current litigation, which was
      offset by an increase in auditing fees incurred during the beginning of the
      second quarter of 2005 related to the acquisition of LaPolla. The $127,697
      increase in professional fees in the first six months of 2005 compared to the
      same 2004 period was primarily the result of an increase in attorney’s fees
      related to past and current litigation, as well as auditing and accounting
      fees
      related to our acquisition of LaPolla.


11
 *Index*


Our
      depreciation and amortization expense was $31,830 for the second quarter of
      2005
      compared to $21,298 for the second quarter of 2004. The increase of $10,532
      was
      primarily the result of purchasing machinery and equipment for our manufacturing
      plants in Florida and Arizona. The $16,596 increase in depreciation and
      amortization expense in the first six months of 2005 compared to the same 2004
      period was primarily due to the acquisition of additional assets and machinery
      and equipment from our acquisition of LaPolla and purchasing machinery and
      equipment for our manufacturing plants in Florida and Arizona.





We
      did
      not incur any research and development costs in the three or six months ended
      June 30, 2005 or 2004.





Consulting
      fees for the three months ended June 30, 2005 were $64,010 as compared to
      $60,780 for the three months ended June 30, 2004. For the six months ended
      June
      30, 2005, consulting fees were $125,392 compared to $70,993 for the six months
      ended June 30, 2004. The increases in 2005 were the result of an increase in
      the
      number and type of consultants engaged to provide business and financial
      consulting services for us.





For
      the
      three months ended June 30, 2005, our interest expense was $57,132 as compared
      to $95,986 for the three months ended June 30, 2004. Our interest expense for
      the six months ended June 30, 2005 was $113,623 as compared to $139,287 for
      the
      six months ended June 30, 2004. The decreases were primarily attributable to
      a
      decrease in the interest rate on loans payable - related party from 9% per
      annum
      to 6% per annum. In addition, the balance on the loans payable - related party
      was $4,279,408 as of June 30, 2005, as compared to a balance of $5,670,000
      as of
      June 30, 2004.





Other
      income in the three and six months ended June 30, 2005 was $19,978 compared
      to
      $0 for the comparable 2004 periods. The increase was primarily the result of
      a
      write-off of estimated taxes for LaPolla due to prior net operating losses
      in
      2004 and gain on the sale of machinery and equipment during the second quarter
      of 2005.





The
      loss
      from discontinued operations for the three months ended June 30, 2005 reflects
      a
      $2,514 gain compared to a loss of $569,251 for the three months ended June
      30,
      2004. The $2,514 gain is due to a decrease in commitments and contingencies
      during the second quarter of 2005. Our loss from discontinued operations for
      the
      six months ended June 30, 2005 reflects a $324,591 loss compared to $1,654,180
      for the six months ended June 30, 2004. The $324,591 loss is the result of
      a
      $327,105 increase in commitments and contingencies, partially offset the by
      the
      $2,514 gain during the three months ended June 30, 2005.





**Financial
      Condition, Liquidity and Capital Resources**





We
      assess
      our liquidity by our ability to generate cash to fund our operations.
      Significant factors in the management of liquidity are: funds
      generated by operations, levels of accounts receivable, inventories, accounts
      payable and capital expenditures, funds required for acquisitions, adequate
      credit facilities, and financial flexibility to attract long-term capital on
      satisfactory terms. Historically, we have generated insufficient cash from
      operations to meet our working capital requirements and have relied principally
      on related party funding from our Chairman over the past six years and outside
      investors to meet our working capital and other corporate needs. With the
      discontinuation of our RSM Products business segment, the acquisition of
      LaPolla, merger of Infiniti and LaPolla, in conjunction with our retention
      of
      proven sales and marketing personnel, we are beginning to see substantial
      improvement in our ability to generate enough cash from our operations to meet
      our working capital requirements. We were required to expend certain funds
      during the first and second quarters to enhance our infrastructure to be able
      to
      effectively manage the growth surge we are continuing to experience in our
      revenue, which included attracting and retaining new executives, integrating
      our
      LaPolla acquisition, creating sales, marketing and promotional materials,
      rolling out our LaPolla Products in national trade shows, implementing new
      software to centralize accounting processes, satisfying non-recurring
      liabilities related to our discontinued RSM Products business, adding more
      sales
      personnel to open up new markets for our LaPolla Products in strategic
      locations, and opening up new geographically dispersed warehouses to support
      our
      national sales strategies and growth plans.





We
      had
      $112,176 of cash on hand at June 30, 2005 as compared to $24,903 at December
      31,
      2004. When the Company acquired LaPolla, an additional $68,175 was acquired
      giving a total of $93,078, that when subtracted from $112,176 represents a
      net
      increase in cash of $19,098 for the six months ended June 30, 2005. During
      the
      six months ended June 30, 2005, our working capital deficit decreased $2,181,629
      from a deficit of $8,326,670 as of December 31, 2004 to a deficit of $6,145,041
      as of June 30, 2005. This decrease in the working capital deficit resulted
      from
      a decrease of $1,390,592 in loans payable-related party and a decrease in
      interest of $223,300 due to the Chairman from debt cancellation, a $2,837,726
      increase in accounts payable and accrued expenses and an increase of $23,277
      in
      long-term debt, after taking into account a $2,738,346 increase in net accounts
      receivable, an increase in inventory of $558,361, a $119,095 decrease in the
      lines of credit, an increase of $67,738 in prepaid expenses and other current
      assets, and a decrease of $358,204 in commitments and
      contingencies.





For
      the
      six months ended June 30, 2005 and 2004, the net cash used for operating
      activities was $2,386,231 and $3,877,721, respectively. The net cash flow used
      for investing activities was $2,432,323 for the six months ended June 30, 2005,
      as compared to the six months ended June 30, 2004, where the net cash flow
      provided by investing activities was $2,260. The net cash provided by financing
      activities was $4,837,652 for the six months ended June 30, 2005 compared to
      $3,930,139 for the same 2004 period.


12
 *Index*


The
      net
      cash used for operating activities for the six months ended June 30, 2005 was
      $2,386,231 compared to cash used of $3,877,721 for the six months ended June
      30,
      2004. The decrease in net cash used for operating activities of $1,491,490
      was
      primarily due to an increase in accounts receivable, inventory, prepaid and
      other current assets, accounts payable and accrued expenses, interest payable,
      and a decrease in commitments and contingencies.





The
      net
      cash used for investing activities for the six months ended June 30, 2005 was
      $2,432,323 compared to the net cash provided by investing activities of $2,260
      for the six months ended June 30, 2004. This increase in net cash used for
      investing activities of $2,434,583 was primarily attributable to our investment
      in LaPolla for $2,000,000 in cash, an increase in acquisitions of machinery
      and
      equipment, and an increase in deposits and other non current assets, partially
      offset by an increase in disposition of machinery and equipment.





The
      net
      cash provided by financing activities for the six months ended June 30, 2005
      was
      $4,837,652 compared to the net cash provided of $3,930,139 for the six months
      ended June 30, 2004. The increase in net cash provided from financing activities
      of $907,513 was attributable to an increase in monies received from the Chairman
      for the purchase of LaPolla, an increase from proceeds received from a new
      notes
      payable, partially offset by an increase in payments made on our long term
      debt,
      notes and lines of credit.





We
      believe that the net cash provided by operating activities, supplemented as
      necessary with borrowings available under our existing credit facilities, will
      provide us with sufficient resources to meet our working capital requirements
      during the remainder of this year. Based on our revenue growth trend, we will
      probably require additional funds to maintain and further improve our financial
      relationships with our main vendors, the result of which will likely lead to
      lower raw material costs and higher gross profit margins on select LaPolla
      Products. The Chairman has loaned us $4,302,500 and is a co-borrower or has
      personally guaranteed $1,289,754 for added security on lines of credit,
      long-term debt, and a note payable, which we are responsible to repay or
      otherwise settle. Based on the foregoing, the Company is anticipating raising
      monies during the latter part of the 2005 year, through private placements
      of
      debt or equity, to obtain sufficient resources to meet our longer term working
      capital requirements, debt service and other cash needs over the next year
      or
      until we repay or settle the financial matters between us and the Chairman
      and
      become self sufficient with the cash received from our operating activities.
      There can be no assurance that the Company will be able to obtain any funds,
      or
      if obtainable, on terms that are commercially feasible. ***See
      also*** Part I -
      Financial Information, Item 1. Financial Statements, Notes to Condensed
      Consolidated Financial Statements, Note 3. Going Concern.





**Forward
      Looking Statements**





Statements
      made by us in this report and in other reports and statements released by us
      that are not historical facts constitute “forward-looking statements” within the
      meaning of Section 27A of the Securities Act of 1933, Section 21 of
      the Securities Exchange Act of 1934 and the Private Securities Litigation Reform
      Act of 1995. These forward-looking statements are necessarily estimates
      reflecting the best judgment of senior management and express our opinions
      about
      trends and factors which may impact future operating results. You can identify
      these and other forward-looking statements by the use of words such as “may,”
“will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,”
“predicts,” “intends,” “potential,” “continue,” or the negative of such terms,
      or other comparable terminology. Such statements rely on a number of assumptions
      concerning future events, many of which are outside of our control, and involve
      risks and uncertainties that could cause actual results to differ materially
      from opinions and expectations. Any such forward-looking statements, whether
      made in this report or elsewhere, should be considered in context with the
      various disclosures made by us about our businesses including, without
      limitation, the risk factors discussed below. Although we believe our
      expectations are based on reasonable assumptions, judgments, and estimates,
      forward-looking statements involve known and unknown risks, uncertainties,
      contingencies, and other factors that could cause our or our industry's actual
      results, level of activity, performance or achievement to differ materially
      from
      those discussed in or implied by any forward-looking statements made by or
      on
      the Company and could cause our financial condition, results of operations,
      or
      cash flows to be materially adversely affected. In evaluating these statements,
      some of the factors that you should consider include the following: (a)
      Financial position and results of operations, including general and
      administrative expense targets and effects on income from continuing operations;
      (b) Cash position and cash requirements, including the sufficiency of our cash
      requirements for the next twelve months; (c) Sales and margins; (d) Sources,
      amounts, and concentration of revenue; (e) Costs and expenses; (f) Accounting
      estimates, including treatment of goodwill and intangible assets, doubtful
      accounts, inventory, restructuring, and warranty, and product returns; (g)
      Operations, supply chain, quality control, and manufacturing supply, capacity,
      and facilities; (h) Products and services, price of products, product lines,
      and
      product and sales channel mix; (i) Relationship with customers, suppliers and
      strategic partners; (j) Raw material variations, substrate preparation,
      application specifications, operator techniques, and ambient weather
      fluctuations; (k) Acquisition and disposition activity; (l) Credit facility
      and
      ability to raise capital; (m) Real estate lease arrangements; (n) Global
      economic, social, and geopolitical conditions; (o) Industry trends and our
      response to these trends; (p) Tax position and audits; (q) Cost-reduction
      efforts, including workforce reductions, and the effect on employees; (r)
      Sources of competition; (s) Protection of intellectual property; (t) Outcome
      and
      effect of current and potential future litigation; (u) Research and development
      efforts; (v) Future lease obligations and other commitments and liabilities;
      (w)
      Common stock, including trading price; (x) Security of computer systems; and
      (y)
      Changes in accounting policies and practices, as may be adopted by regulatory
      agencies, and the Financial Accounting Standards Board. We do not plan to update
      any such forward-looking statements and expressly disclaim any duty to update
      the information contained in this report except as required by
      law.


13
 *Index*


**Item
                3.**
            **Quantitative
                and Qualitative Disclosures About Market
                Risk.**





We
      do not
      issue or invest in financial instruments or their derivatives for trading or
      speculative purposes and are not subject to material foreign currency exchange
      risks at this time. Our outstanding debt and related interest expense, as it
      relates to interest rate exposure, in the United States is currently not
      material to our operations.





**Item
                4.**
            **Controls
                and Procedures.**





We
      maintain disclosure controls and procedures that are designed to ensure that
      information required to be disclosed in our Exchange Act reports is recorded,
      processed, summarized and reported within the time periods specified in the
      Securities and Exchange Commission’s rules and forms, and that such information
      is accumulated and communicated to our management, including our Principal
      Executive Officer and our Principal Financial Officer, as appropriate, to allow
      timely decisions regarding required disclosures. Our management, including
      our
      Principal Executive Officer and our Principal Financial Officer, does not expect
      that our disclosure controls or procedures will prevent all error and all fraud.
      A control system, no matter how well conceived and operated, can provide only
      reasonable, not absolute, assurance that the objectives of the control system
      are met. Further, the benefits of controls must be considered relative to their
      costs. Because of the inherent limitations in all control systems, no evaluation
      of controls can provide absolute assurance that all control issues and instances
      of fraud, if any, within IFT have been detected. These inherent limitations
      include the realities that judgments in decision-making can be faulty, and
      that
      breakdowns can occur because of simple error or mistake. Additionally, controls
      can be circumvented by the individual acts of some persons, by collusion of
      two
      or more people, or by management override of the control. The design of any
      system of controls is also based in part upon certain assumptions about the
      likelihood of future events, and there can be no assurance that any design
      will
      succeed in achieving its stated goals under all potential future conditions.
      Because of the inherent limitations in a cost-effective control system,
      misstatements due to error or fraud may occur and not be detected.





We
      carried out an evaluation, under the supervision and with the participation
      of
      our management, including our Principal Executive Officer and our Principal
      Financial Officer, of the effectiveness of the design and operation of our
      disclosure controls and procedures as of June 30, 2005, the end of the quarterly
      period covered by this report. Based on the foregoing, our Principal Executive
      Officer and our Principal Financial Officer concluded that our disclosure
      controls and procedures were effective at the reasonable assurance
      level.





There
      has
      been no change in our internal controls over financial reporting during our
      most
      recent fiscal quarter that has materially affected, or is reasonably likely
      to
      materially affect, our internal controls over financial reporting.





**PART
      II — OTHER INFORMATION**


**Item 1.**
              **Legal
                  Proceedings.**




The
      following supplements and amends our discussion set forth under Part I,
      Item 3, “Legal Proceedings” in our Annual Report on Form 10-K for the year
      ended December 31, 2004 and Part II, Item 1 in our Quarterly
      Report on Form 10-Q for the quarter ended March 31, 2005.





*(a)*
            *Plymouth
                Industries, Inc. vs. Urecoats Industries Inc,. Urecoats Manufacturing,
                Inc., et. al., Defendants*





The
      litigation between Plymouth Industries, Inc., Plaintiff, and Urecoats Industries
      Inc. and its wholly-owned subsidiaries Urecoats Manufacturing, Inc. and Urecoats
      Technologies, Inc. and Richard J. Kurtz, Defendants, has been settled pursuant
      to a Court approved Confidential Settlement Agreement, wherein none of the
      parties admitted liability or made any admissions with respect to the
      allegations or claims made in the litigation.





(b)
            V*arious
                Lawsuits and Claims Arising in the Ordinary Course of
                Business*





We
      are
      involved in various lawsuits and claims arising in the ordinary course of
      business, which are, in our opinion, immaterial both individually and in the
      aggregate with respect to our consolidated financial position, liquidity or
      results of operations.





Because
      of the uncertainties related to the incurrence, amount and range of loss on
      any
      pending litigation or claim, we are currently unable to predict the ultimate
      outcome of any litigation or claim. In view of the unpredictable nature of
      such
      matters, we cannot provide any assurances regarding the outcome of any
      litigation or claim to which we are a party or the impact on us of an adverse
      ruling in such matters.


14
 *Index*


**Item
                2.**
            **Changes
                in Securities and Use of
                Proceeds.**




**Recent
      Sales of Unregistered Securities**





During
      the quarterly period ended June 30, 2005, we issued restricted common stock
      for
      certain private transactions, in reliance on Section 4(2) of the Act, as
      described below:





(a) On
      May
      28, 2005, the third increment of 292,000 shares of restricted common stock
      granted and issued to our Chairman pursuant to a one time grant of 1,168,000
      shares under the Director Compensation Plan (“Director Plan”), vested. We did
      not consider these shares issued and outstanding due to a vesting provision
      and
      non-delivery of the shares pending vesting and as such no value was ascribed
      to
      these shares when originally issued on May 28, 2002. The value ascribed to
      these
      vested shares was recorded at $277,400. There are 292,000 shares remaining
      issued but in our custody until such time that they are earned and vested
      (“Fourth Increment”).





(b) On
      May
      28, 2005, we established a value pursuant to SFAS No. 123R to account for the
      Fourth Increment of 292,000 unvested shares of restricted common stock granted
      and issued pursuant to the Director Plan described above, using the closing
      price of our common stock as traded on the American Stock Exchange (“Amex”) of
      $.95 per share. The portion of the Fourth Increment allocable to this quarterly
      period totaled 26,400 shares and was valued and recorded at
      $25,080.





(c) On
      June
      29, 2005, an aggregate of 68,767 shares of restricted common stock automatically
      granted and issued to non-employee directors pursuant to the Director Plan
      upon
      election at the annual meeting of stockholders held on June 22, 2004 or upon
      appointment thereafter, vested. We did not consider these shares issued and
      outstanding due to a vesting provision and non-delivery of the shares pending
      vesting and as such no value was ascribed to these shares when originally
      issued. The value ascribed to these vested shares was recorded at
      $61,890.





(d) On
      June
      29, 2005, an aggregate of 72,000 shares of restricted common stock were
      automatically granted and issued to non-employee directors pursuant to the
      Director Plan upon election at the annual meeting of stockholders held on June
      29, 2005, which shares generally vest at the next annual meeting of
      stockholders. Due to a vesting provision in the Director Plan, these shares
      are
      not treated as issued and outstanding and remain in our custody until earned
      and
      vested. We established a value pursuant to SFAS No. 123R to account for the
      unvested shares of restricted common stock, using the closing price of our
      common stock of as traded on the Amex of $.90 per share. The portion of the
      72,000 shares allocable to this quarterly period totaled 438 shares and was
      valued and recorded in the aggregate at $394.





(e) On
      June
      30, 2005, we issued 4,000 shares of restricted common stock to our CEO, as
      other
      compensation, pursuant to his employment agreement, which was valued and
      recorded at $3,600.


**Item
                  3.**
              **Defaults
                  Upon Senior Securities.**
  None.
  **Item
                  4.**
              **Submission
                  of Matters to a Vote of Security
                  Holders.**




We
      held
      our Annual Meeting of Stockholders on June 29, 2005. At the Annual Meeting,
      our
      stockholders elected four directors as more fully described below. At our Annual
      Meeting, there were present in person or by proxy 46,063,931 votes, representing
      approximately 92% of the total outstanding eligible votes. The result of the
      proposal considered at the Annual Meeting was as follows:





**Proposal
      One - Election of Directors**


**Affirmative
                Votes**
            
            **Withheld**1.  
                Richard J. Kurtz
            
            44,689,664
            
            374,2672.  
                Lt. General Arthur J. Gregg, US Army (Retired)
            
            44,689,413
            
            374,5183.  
                Michael T. Adams
            
            44,689,328
            
            374,6034.  
                Gilbert M. Cohen
            
            45,162,063
            
            901,868





**Item 5.**
            **Other
                Information.**





None.





**Item
                6.**
            **Exhibits.**




***See*** Index of
      Exhibits on Page 17.


15
 *Index*


**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 thereunto
      duly authorized.





**IFT
                CORPORATION**Date: 7/20/05
            By:
            /s/ Michael
              T. Adams, CEOMichael T. AdamsCEO




**IFT
                CORPORATION**Date: 7/20/05
            By:
            /s/ Charles
              R. Weeks, CFOCharles R. WeeksCFO
              and Treasurer


16
 *Index*


**INDEX
      OF EXHIBITS**





**Exhibit**
              **Number**
            
            **Description**31.1
            
            Certification
                of Principal Executive Officer pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.31.2
            
            Certification
                of Principal Financial Officer pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.32
            
            Certification
                of Principal Executive Officer and Principal Financial Officer pursuant
                to
                § 906 of Sarbanes-Oxley Act of
                2002.





17