FORM
10-Q





SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
DC 20549





x QUARTERLY REPORT UNDER
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934





For the quarterly period
endedJUNE 30, 2010





 ̈TRANSITION REPORT UNDER
SECTION 13 OR 15(d) OF THE EXCHANGE ACT





For the
transition period from____________ to _____________





Commission
file number   000-31385





GLOBAL
FOOD TECHNOLOGIES, INC.


(Exact
name of registrant as specified in charter)





Delaware
                52-2257546(State
      incorporation)
                (IRS
      EmployerIdentification
      No.)





113
      Court Street,  Hanford,  California
              93230(Address
      of principal executive offices)
              (zip
      code)





559-589-0100


(Issuer’s
telephone number)





Indicate
by check mark whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.


Yes  x    No
 ̈





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such
files).   Yes   ̈    No
 ̈





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer,  non-accelerated filer, or a smaller reporting
company.


Large
accelerated filer  ̈   accelerated
filer  ̈  non
accelerated filer  ̈  smaller
reporting company x





Indicate
by check mark whether registrant is a shell company  Yes ̈  Nox





Indicate
the number of shares outstanding of each issuer’s classes of common equity, as
of the last practicable date:


Class
                Outstanding as of June 30,
    2010Common
      stock, par value $0.0001
                29,833,667










GLOBAL
FOOD TECHNOLOGIES, INC.


QUARTERLY
REPORT ON FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2010





TABLE OF
CONTENTS





PART
      I – FINANCIAL INFORMATION
                3ITEM
      1.      FINANCIAL STATEMENTS
                3ITEM
      2.      MANAGEMENT’S DISCUSSION AND ANALYSIS OF
      FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                10ITEM
      3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
    RISK
                15ITEM
      4. CONTROLS AND PROCEDURES
                15PART
      II - OTHER INFORMATION
                15ITEM
      1.  LEGAL PROCEEDINGS
                15ITEM
      1A.   RISK
    FACTORS
                15ITEM
      2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
      PROCEEDS
                18ITEM
      3.  DEFAULTS UPON SENIOR SECURITIES
                18ITEM
      4.  RESERVED
                18ITEM
      5.  OTHER INFORMATION
                18ITEM
      6.  EXHIBITS
                20


2





PART
I – FINANCIAL INFORMATION





ITEM
1.        FINANCIAL STATEMENTS





GLOBAL
FOOD TECHNOLOGIES, INC.


CONDENSED
CONSOLIDATED BALANCE SHEETS





June 30,
                        2010
                        (Unaudited)
                      
                      
                      December 31,
                        2009ASSETSCurrent
      AssetsCash
                      
                      $
                      72,432
                      
                      
                      $
                      22,135Accounts receivable
                      
                      
                      69,668
                      
                      
                      
                      190,098Inventory
                      
                      
                      582,200
                      
                      
                      
                      662,609Prepaid expenses
                      
                      
                      52,719
                      
                      
                      
                      36,224Total Current Assets
                      
                      
                      777,019
                      
                      
                      
                      911,066Fixed
      Assets – net
                      
                      
                      951,211
                      
                      
                      
                      993,172Other
      Asset
                      
                      
                      26,089
                      
                      
                      
                      26,089TOTAL
      ASSETS
                      
                      $
                      1,754,319
                      
                      
                      $
                      1,930,327LIABILITIES AND STOCKHOLDERS’
      DEFICITCurrent
      LiabilitiesAccounts
      payable
                      
                      $
                      635,895
                      
                      
                      $
                      628,039Accrued
      liabilities
                      
                      
                      881,413
                      
                      
                      
                      514,388Notes
      payable – related parties
                      
                      
                      640,000
                      
                      
                      
                      640,000Note
      payable – others
                      
                      
                      246,000
                      
                      
                      
                      126,000Notes
      payable – trade and equipment
                      
                      
                      967,000
                      
                      
                      
                      812,000Total
      Current Liabilities
                      
                      
                      3,370,308
                      
                      
                      
                      2,720,427Commitments
      and ContingenciesStockholders’
      Deficit:Preferred
      stock, $.0001 par value, 20,000,000 shares authorized, Series A and B ,
      none issued and outstanding, Series C,  399,613 and 257,222
      shares issued and outstanding at June 30, 2010 and December 31, 2009,
      respectively
                      
                      
                      40
                      
                      
                      
                      26Common
      stock, $.0001 par value, 100,000,000 shares authorized, 29,833,667 and
      29,752,513 shares issued and outstanding at June 30, 2010 and December 31,
      2009, respectively
                      
                      
                      2,983
                      
                      
                      
                      2,976Additional
      paid-in capital
                      
                      
                      60,829,099
                      
                      
                      
                      59,823,171Accumulated
      deficit
                      
                      
                      (62,448,111
                      )
                      
                      
                      (60,616,273
                      )Total
      Stockholders’ Deficit
                      
                      
                      (1,615,989
                      )
                      
                      
                      (790,100
                      )TOTAL
      LIABILITIES AND STOCKHOLDERS’ DEFICIT
                      
                      $
                      1,754,319
                      
                      
                      $
                      1,930,327





See
accompanying notes to condensed consolidated financial
statements


3





GLOBAL
FOOD TECHNOLOGIES, INC.


CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS


(Unaudited)




For the Three Months Ended
                  June 30,
                
                
                For the Six Months Ended
                  June 30,2010
                
                
                2009
                
                
                2010
                
                
                2009Revenues
                
                $
                314,476
                
                
                $
                -
                
                
                $
                635,800
                
                
                $
                -Cost
      of goods sold
                
                
                314,332
                
                
                
                -
                
                
                
                645,396
                
                
                
                -Gross
      profit (loss)
                
                
                144
                
                
                
                -
                
                
                
                (9,596
                )
                
                
                -ExpensesMarketing
                
                
                354,572
                
                
                
                399,931
                
                
                
                633,985
                
                
                
                709,761General
      and administrative
                
                
                302,178
                
                
                
                496,603
                
                
                
                719,678
                
                
                
                887,290Research
      and development
                
                
                188,899
                
                
                
                174,140
                
                
                
                363,819
                
                
                
                346,256Depreciation
                
                
                20,981
                
                
                
                17,292
                
                
                
                41,962
                
                
                
                38,422Interest
                
                
                34,962
                
                
                
                14,038
                
                
                
                62.798
                
                
                
                24,838Total
      Expenses
                
                
                901,592
                
                
                
                1,102,004
                
                
                
                1,822,242
                
                
                
                2,006,567NET
      LOSS
                
                $
                (901,448
                )
                
                $
                (1,102,004
                )
                
                $
                (1,831,838
                )
                
                $
                (2,006,567
                )Loss
      per common share, basic and diluted
                
                $
                (0.03
                )
                
                $
                (0.04
                )
                
                $
                (0.06
                )
                
                $
                (0.07
                )Weighted
      average common shares outstanding, basic and diluted
                
                
                29,810,542
                
                
                
                29,288,920
                
                
                
                29,790,254
                
                
                
                29,199,165




See
accompanying notes to condensed consolidated financial
statements


4





GLOBAL
FOOD TECHNOLOGIES, INC.


CONDENSED
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT


(Unaudited)





Preferred Stock
                  
                  
                  Common Stock
                  
                  
                  Additional
                    Paid-in
                  
                  
                  Accumulated
                  
                  
                  Total
                    Stockholders’Shares
                  
                  
                  Amount
                  
                  
                  Shares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  Deficit
                  
                  
                  DeficitBalance,
      December 31, 2009
                  
                  
                  257,222
                  
                  
                  
                  26
                  
                  
                  
                  29,752,513
                  
                  
                  
                  2,976
                  
                  
                  
                  59,823,171
                  
                  
                  
                  (60,616,273
                  )
                  
                  
                  (790,100
                  )Sales
      of common stock and warrants for cash
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  12,125
                  
                  
                  
                  1
                  
                  
                  
                  54,562
                  
                  
                  
                  -
                  
                  
                  
                  54,563Sale
      of preferred stock for cash
                  
                  
                  142,391
                  
                  
                  
                  14
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  640,744
                  
                  
                  
                  -
                  
                  
                  
                  640,758Common
      stock issued for services
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  69,029
                  
                  
                  
                  6
                  
                  
                  
                  310,622
                  
                  
                  
                  -
                  
                  
                  
                  310,628Net
      loss
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (1,831,838
                  )
                  
                  
                  (1,831,838
                  )Balance,
      June 30, 2010
                  
                  
                  399,613
                  
                  
                  $
                  40
                  
                  
                  
                  29,833,667
                  
                  
                  $
                  2983
                  
                  
                  $
                  60,829,099
                  
                  
                  $
                  (62,448,111
                  )
                  
                  $
                  (1,615,989
                  )





See
accompanying notes to condensed consolidated financial
statements


5




GLOBAL
FOOD TECHNOLOGIES, INC.


CONDENSED
STATEMENTS OF CASH FLOWS


(Unaudited)





For
      the Six Months Ended
                  June
      30,2010
                
                
                2009CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss
                
                $
                (1,831,838
                )
                
                $
                (2,006,567
                )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
                
                
                41,962
                
                
                
                38,422Stock
      issued for services
                
                
                310,628
                
                
                
                227,273Changes
      in operating assets and liabilities:Accounts
      Receivable
                
                
                120,430
                
                
                
                -Inventory
                
                
                80,409
                
                
                
                (86,782
                )Prepaid
      expenses
                
                
                (16,495
                )
                
                
                (13,387
                )Other
      assets
                
                
                -
                
                
                
                (300
                )Accounts
      payable and accrued liabilities
                
                
                374,880
                
                
                
                (17,045
                )Cash
      used in operating activities
                
                
                (920,024
                )
                
                
                (1,858,386
                )CASH
      FLOWS FROM INVESTING ACTIVITIESAcquisition
      of  fixed assets
                
                
                -
                
                
                
                (146,956
                )Net
      cash used in investing activities
                
                
                -
                
                
                
                (146,956
                )CASH
      FLOWS FROM FINANCING ACTIVITIESProceeds
      from notes payable
                
                
                275,000
                
                
                
                250,000Sale
      of preferred stock
                
                
                640,758
                
                
                
                1,000,000Sale
      of common stock
                
                
                54,563
                
                
                
                690,820Net
      cash provided by financing activities
                
                
                970,321
                
                
                
                1,940,820CHANGE
      IN CASH
                
                
                50,297
                
                
                
                (64,525
                )CASH
      – BEGINNING OF PERIOD
                
                
                22,135
                
                
                
                278,443CASH
      – END OF PERIOD
                
                $
                72,432
                
                
                $
                213,918SUPPLEMENTAL
      DISCLOSURESInterest
      paid
                
                $
                48,200
                
                
                $
                5,512Non-cash
      financing transactions:Issuance
      of common stock for accrued liabilities
                
                $
                -
                
                
                $
                697,500





See
accompanying notes to condensed consolidated financial
statements


6




GLOBAL
FOOD TECHNOLOGIES, INC.


NOTES TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


JUNE 30,
2010





1.
Description and nature
of the business, organization and basis of presentation.





Global
Food Technologies, Inc. (the “Company”, “we” or “us”) is a biotechnology company
focused on the development of food safety processes for the food processing
industry by using its proprietary scientific processes to make commercially
packaged seafood safer for human consumption and to increase the shelf life of
those products. The Company has developed a process using its developed
technology called the “iPuraTMFood
Processing System”. The Company’s ability to
generate revenue will depend, among other things, on its ability to demonstrate
the merits of the iPuraTMsystem as well as brand development and establishing alliances with
suppliers and vendors.  The Company has generated modest revenues to
date.





Unreviewed
Interim Financial Statements





Our
interim financial statements as of June 30, 2010 and for the three and six
months then ended have not been reviewed by our independent registered public
accounting firm as required by SEC rules and regulations. The required review of
such financial statements could not be completed without incurring undue
hardship and expense and the Company will file an amended Form 10-Q for this
period once the required review is completed.





Going
Concern





The
accompanying financial statements have been prepared on the basis that the
Company will continue as a going concern, which assumes the realization of
assets and the satisfaction of liabilities in the normal course of business.
Since inception, the Company has primarily been engaged in product development
and pre-operational activities.  Sales began during the quarter ended
September 30, 2009, however, only modest sales have been generated and the
Company has never earned a profit. At June 30, 2010, the Company has accumulated
losses totaling $62,448,111, negative working capital of $1,615,989, and
negative cash flows from operations of $920,024 for the quarter ended June 30,
2010. The Company’s ability to continue as a going concern is predicated on its
ability to raise additional capital, increase sales and margins, and ultimately
achieve sustained profitable operations.  The uncertainty related to
these conditions raises substantial doubt about the Company’s ability to
continue as a going concern. The accompanying financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.




Basis
of presentation





The
accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles in the
United States of America for interim financial information and pursuant to the
rules and regulations of the United States Securities and Exchange Commission
(“SEC”).  Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring adjustments) considered necessary for a fair presentation
have been included. These financial statements should be read in conjunction
with the Company’s Annual Report on Form 10-K for the fiscal year ended December
31, 2009, filed with the SEC on March 31, 2010.  The results of
operations for interim periods are not necessarily indicative of the results
expected for a full year or for any future period. The condensed balance sheet
as of June 30, 2010 and any related disclosures have been derived from the
December 31, 2009 audited financial statements filed in the Company’s 2009 Form
10-K.




7


Accounting
policies





Revenue
Recognition




The
Company recognizes revenues when all of the following conditions exist:  a)
persuasive evidence of an arrangement exists; b) delivery has occurred or
services have been rendered; c) the Company’s price to the buyer is fixed or
determinable, and d) collectability is reasonably assured.  To date, all of
the orders from our customers have met these criteria and therefore, the Company
recognizes revenue when product is shipped to the customer.





Use of
estimates





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 and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting periods.
Actual results could differ from those estimates.





Loss per common
share





Loss per
common share was computed using the weighted average number of shares of common
stock outstanding during the period. Preferred stock, purchase options, and
warrants were not used in the computation since their effect would be
antidilutive.





Income
taxes





The
Company has no significant income tax expense or benefit for the periods
presented due to its tax net operating loss carryforwards and related 100%
deferred tax asset valuation allowance.





Inventory





Inventory
is stated at the lower of cost (first-in, first-out) or
market.  Market is determined by comparison with recent sales or net
realizable value.





2.
Inventory.





At June
30, 2010, inventory consists of frozen tilapia fish available for sale.  It
is classified as finished goods and is recorded at delivered cost.





3. Trade and Equipment
Financing Notes Payable.





As an
alternative to commercial trade financing, leasing and factoring, we have
instituted a program of issuing promissory notes, secured by inventory or iPura
equipment systems, in series of maturities from one to three years with annual
interest rates from 8.2% to 9.8%. The funds are received and controlled by a
third party custodian to be disbursed only for third party costs of inventory or
equipment. As is typical of trade financing, the proceeds of sale of inventory
by the Company upon collection will be prorated and be used to repay the
financing. Equipment financing debt will be paid at maturity from working
capital derived from the commercial operation of the equipment. At June 30,
2010, the Company owed $815,000 in trade financing debt and $152,000 in
equipment financing debt, for a total of $967,000.




8


4.  Notes Payable
- others.





In July
2009, a note for $126,000 was entered into with a third party, independent of
the trade and equipment financing debt program. The note has a one year term,
has been renewed and is due July 2011, bears interest of 5% and is convertible
into common stock at the option of the lender at any time at a price of $4.50
per share. The third party loaned an additional $70,000 in March 2010 and an
additional $50,000 in June 2010, on the same terms.





5. Notes Payable Related
Parties.





On April
3, 2006, we arranged a 30 day bridge loan in the amount of $350,000 from a
non-principal shareholder. The loan bears interest at eight percent (8%) per
annum and is secured by all assets, including any intellectual assets, of the
Company. Additional consideration included the issuance of warrants to purchase
35,000 shares of our common stock. The warrants are exercisable at $4.50 per
share for two (2) years from the date of repayment. The Company determined the
fair value of the warrants to be $49,245 based upon the Black-Scholes option
pricing model. In July 2006, $100,000 of principal was repaid. The remaining
balance of $250,000 is due on demand. The loan is guaranteed by the President of
the Company.




In April
and May of 2006, we arranged for two loans aggregating $190,000 from a Director,
Gary Nielsen, of the Company. The loans bear interest of 8%. Additional
consideration for the loans was approved by the Board in August 2006, in the
form of warrants to purchase 29,000 shares of our common stock. The warrants are
exercisable at $4.50 per share for two (2) years from the date of repayment. The
Company determined the fair value of the warrants to be $40,803 based upon the
Black-Scholes option pricing model. In August 2006, we arranged for an
additional loan, a six month bridge loan, for $100,000 from the Director bearing
interest at 8%. The loan was renewed each subsequent maturity for an additional
six months and now matures in November 2010 and is expected to be renewed. Such
loans are unsecured.





In
January and May 2008, additional loans of $100,000 each were borrowed from a
Director, Gary Nielsen, with 12% annual interest rates.  The notes
were for 30 and 60 days respectively and were repaid at their due
dates.




In
September 2009, a Director, Gary Nielsen, advanced $100,000 on a 30 day note
bearing interest at 12% per annum. The note was not paid at maturity and
continues in effect as a demand note.





6. Stockholders’
Deficit.





Preferred
Stock Issuance.





In the
three months ended June 30, 2010, we issued an additional 16,667 shares of
Series C preferred stock and 33,333 warrants to purchase common stock in private
placements for total proceeds of $75,000. All unit stock sales were at $4.50 per
unit. All warrants are exercisable for three years at a price of the greater of
$3.00 or 50% of the bid price on an approved public exchange or the most recent
private offering price if there is no exchange.




9


The
Series C has preferential rights in liquidation over common stock at $4.50 per
share and is convertible into common stock at a one to one conversion rate.
There is mandatory conversion to common stock upon the earlier of certain events
or five years. The Series C bears a dividend of 8% payable in cash upon
declaration of the dividend by the Board of Directors and such accrued dividend
shall be payable in cash only in the event working capital requirements
permit.  Until such conditions are met, the dividends are not accrued.
Each issued share is accompanied by two warrants to purchase common stock for a
period of three years at an exercise price for the greater of $3.00 or 50% of
the bid price on an approved public exchange or the most recent private offering
price if there is no exchange. The cumulative, undeclared dividends were
approximately $22,200 at June 30, 2010.





Common Stock
Issuances.





We have
been selling stock to fund operations since inception and expect to continue to
sell stock to fund continued operations.





In the
three months ended June 30, 2010, there were no sales of common stock for
cash.





In the
three months ended June 30, 2010, a total of 46,250 shares of common stock were
issued for services received from consultants totaling $208,124.





Warrants.





There are
9,221,020 warrants outstanding as of June 30, 2010.





The above
securities were issued under exemption from Regulation under either Regulation D
or S promulgated by the Securities and Exchange Commission under the Securities
Act of 1933.





ITEM
      2.
            MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS





Company
Overview





Our iPuraTM System is the physical
on-site processing element of the “iPura
TM Food Safety
Program”, which
combines various food safety elements described below. Our latest generation
iPuraTM System is
designed to process seafood, with certain customization required for different
types of seafood and the specific requirements of a given installation
site.





In 2009,
we completed the installation of our iPuraTM System at a food
processor located in China, Tongwei (Hainan) Aquatic Products Co., and began
producing our first order of inventory and selling it in the United
States.  We completed installation of another iPuraTM System with a
processor in Vietnam,Binh An Seafood Joint
Stock Company, in early 2010, and expect production to begin at this facility by
the end of the fourth quarter of 2010, subject to our ability to raise adequate
capital and secure purchase orders.   We also have a contract for
the installation of our iPuraTM
System with a seafood processor in Chile.  Although this system
has been fabricated, it has not yet been delivered or
installed.




10


From the
commencement of our research and development activities in 2001, we have raised
substantial equity capital to fund the development of our iPuraTM System. As of June 30,
2010, we have generated only modest revenues and since inception we have
incurred accumulated losses totaling $62,448,111 and have negative cash flows
from operations of $920,024 for the quarter ended
June 30, 2010. Research on our first generation prototype was completed in 2004,
and development and refinement on the commercial system design continued through
2005, especially adapting the system to processing salmon. Further development
has resulted in a more efficient, less labor intensive and more easily
maintained processing system.





The
Company is executing its marketing strategy by promoting the iPuraTM brand to food
processors and industry associations as the world’s first food safety
label.In 2008, we
commenced limited marketing of the iPuraTM brand to
consumers.  The iPuraTM seal isanchored with a
descriptive and lasting slogan:“The Highest Standard in Food
SafetyTM”.





·   The
science and marketing connect well with world food safety issues.


·   The
iPuraTM label is a tool
which communicates that exceptional food safety measures have been taken to
protect consumer health.


·   The
label will serve to identify food products that have a higher level of safety
and quality.


·   GFT has
filed trade marks for its brand and slogan in every major food producing and
food consuming nation.


·   Trade
marks are expected to be listed on the primary registry at the USPTO and
internationally, as a global trademark search by counsel found no prior marks or
obstructions.





The iPuraTMFood Safety Program is
the constitution of the iPuraTM food safety brand,
which is anticipated to include:





· An organic pathogenic and spoilage microorganism “kill step” prior to
packaging.


· Intelligent packaging of product.


· Product traceability of handling and temperature.


· An independent third party certification of standards.


· A unique product insurance that follows theiPuraTM labeled product
throughout the distribution chain.


· A distribution chain and consumer “pull through” marketing program promoting
iPuraTM as “The Highest
Standard in Food SafetyTM.”





The iPuraTMFood Safety Program is
designed to help the food distribution chain grow their margins by increasing
the quality, safety, and economic value of their products by reducing or
eliminating the waste and liability associated with the distribution of
contaminated food, and by increasing shelf life.





We plan
to promote the iPuraTM
brand utilizing a media and educational campaign focusing on the health and
economic benefits of iPuraTMtreated products and the
potentially increased profit margins available to the entire distribution chain.
GFT has entered into a media-buying agreement with its strategic partner Global
Media Fund LLC. We believe that this strategy will allow us to gain exposure
through articles published in a large variety of newspapers, news, wire
services, as well as possible radio spots, web placements and social media
networks. 
GFT’s marketing campaign will begin with “Ask your grocer for iPuraTM”. Food safety is
public health news and we anticipate that the iPuraTMfood safety brand will
be publicized as news in media across the globe.





During
the next 12 months, we will continue limited marketing to consumers, as well as
continuing marketing efforts to processors and industry associations to create
awareness of our iPuraTM
brand. Due to capital constraints, direct marketing efforts to consumers have
been limited, other than articles placed by Global Media Fund LLC.




11


Processor
and Distribution Agreements





We have
executed contracts for the installation of our iPuraTM Systems with four
seafood processors, two in Vietnam, one in China and one in
Chile.  The installations have been completed at the processor in
China and with one of the processors in Vietnam.   All of the
current agreements are structured pursuant to our “importer” model (see our
Annual Report on Form 10-K for more details), with our wholly-owned subsidiary,
iPura Food Distribution Company (IFD) responsible for ordering and purchasing
the seafood from the processors, and then importing and distributing the seafood
products to retailers or other distributors.  IFD has also signed
agreements with the same four processors outlining the exclusive purchase
terms.  As detailed below, as of June 30, 2010, we have only commenced
processing seafood with one of these four processors.





Under
these agreements, GFT is generally responsible for the cost of manufacturing,
fabricating and installing the iPuraTM System at the processors’ facilities,
with the processors providing power and utility connections and certain other
operating expenses.  Our iPuraTM System would typically be
installed onto one or two processing lines at the processors’
facilities.  Our iPuraTM System will be operated and supervised by
GFT personnel, at GFT’s expense.  Seafood processed through our iPuraTM
System will then be packaged and labeled with our iPura
seal.  IFD has the exclusive rights to buy and distribute the seafood
processed with our iPuraTM System and the processors therefore cannot sell such
seafood to any other customers or distributors, or otherwise use our iPuraTM
System for any other seafood processing. The agreements have terms that range
from one to three years from the date of completion of the installation of our
iPuraTM System at the respective processor’s facility.  IFD has
obtained most favored nations pricing with respect to seafood purchased under
all of the agreements. None of the agreements have any minimum purchase
requirements for IFD, although one agreement has a target volume schedule, with
potential increases to the per pound seafood price if such targets are not
met.





GFT has
completed the China installation, and begun processing seafood at this facility,
although in limited quantities to date.  Sales of seafood in the U.S.
from this facility accounted for all of our sales to date. There is a second
iPuraTM System located at the processor in China that is available for future
installation if sales levels require it. We have also completed installation of
a larger iPuraTM System
with one processor in Vietnam.  This unit is not yet in production,
although we expect it to be by the end of the fourth quarter of
2010.





We have
received limited purchase orders to date for our products and continue
negotiations with certain select U.S. grocery store retailers, including
negotiations with regional and national retailers.  As discussed
herein, we will need to obtain adequate financing in order to purchase the
seafood from the processor and carry the seafood inventory costs until resold to
a sub-distributor or retailer.





Liquidity
and Capital Resources





Historically,
our sole source of cash has been the sale of equity to
investors.  Although we expect to generate increased revenue from
sales of seafood processed on our iPuraTM Systems
within the next 12 months, any funds generated from such sales during the next
12 months are not expected to cover our operating expenses.




12


Based on
our cash balance as of June 30, 2010, we are in need of immediate additional
financing to fund our current working capital requirements, including accounts
payable.  Furthermore, we believe that we will need approximately $3
million to manufacture iPuraTM Systemsand cover operating expenses during the next 12 months, in addition to a
line of creditor other financing to finance the inventory of iPuraTM  product.  As
an alternative to a traditional commercial bank line of credit, we have
implemented a program, described below, to finance inventory.  The
amount of capital required will vary depending on a variety of factors, many of
which are beyond our control.  We cannot assure you that funds from
our future operations or funds provided by our current financing activities
will meet the requirements of our operations, and in that event, we will
continue to seek additional sources of financing to maintain
liquidity.  Any additional capital we raise may involve issuing
additional shares of common stock or other equity securities, or obtaining debt
financing. However, at this point, we have not specifically identified the type
or sources of this funding.





As of
June 30, 2010, we had debt other than trade indebtedness in the ordinary course
of business in the form of short term loans of $640,000 from a Director and a
shareholder due on demand and three one year notes from a third party in the
amount of $246,000.  Currently, we do not have the ability or
resources to repay such loans if a demand is made for repayment in
full.


We have
implemented a trade financing program for individual accredited investors as an
alternative to traditional commercial inventory financing and
factoring.  This financing program consists of issuing promissory
notes, secured by inventory, in series of maturities from one to three years
with annual interest rates from 8.2% to 9.8%. The funds are received and
controlled by a third party custodian to be disbursed only for third party costs
of inventory. As is typical of trade financing, the Company’s collected sales
proceeds will be utilized to service this debt. At June 30, 2010, $815,000 in
trade financing debt has been received.





In July
2009, we also implemented an equipment financing program based on the same
structure as the trade finance program using short term notes secured by the
installed iPura
TM equipment located in
Vietnam. At June 30, 2010, $152,000 in equipment financing debt has been
received.





We are
actively pursuing all potential financing options as we look to secure
additional funds both to stabilize and to grow our business operations. Our
management will review any financing options at their disposal, and will judge
each potential source of funds on its individual merits. Since we have not
located any commercial bank inventory financing, we are developing options for
inventory debt financing with other private parties, as described in more detail
above.  Successful inventory financing is a critical need in order for
us to continue distributing our products and generating revenue.  We
cannot assure you that we will be able to secure additional funds from debt or
equity financing, as and when we need to, or if we can, that the terms of this
financing will be favorable to us or our stockholders. We are exploring
commercial and joint venture financing opportunities and relationships with
potential processor/customers with sale and lease-back
arrangements.





We
believe that we have adequate plant capabilities and capacity and sufficient
qualified personnel to achieve our planned operations over the next 12
months.  Historically, the fabrication of major components of our
iPuraTM System
have been outsourced.  We will likely continue this practice, and may
also elect to outsource the integration and installation of the units depending
on the number of units installed and the logistics of a particular site. We will
add non-technical support personnel as required to manage the increase in
administrative activity.




13


Results
of Operations





Sales:





We began
sales in July 2009, with sales of $343,179 recorded for the year ended December
31, 2009. In the first quarter ended March 31, 2010, sales were $321,324, of
which 65% were to Safeway, Inc., a large national chain. In the second quarter
ended June 30, 2010, sales were $314,476, of which 39% were to Safeway. The
remaining sales were to regional grocery distributors that sell to independent
grocery stores, food service distributors and restaurants in many regions
throughout the country. We anticipate an increase in volume from these existing
customers and additional sales to new chains and distributors as they respond to
our marketing programs. Our gross profit on these limited sales for the first
six months was a negative $9,596 or -1.5%. Whereas invoicing margins
remained consistent from prior periods, increased warehousing and transportation
costs included in cost of sales were not absorbed by the volume of sales
activity. We anticipate that our gross margins will continue to be very
small throughout the remainder of 2010, as we continue to roll out of products
with extremely competitive, commodity-based pricing.  If we are
successful in promoting our iPura brand and its benefits, we anticipate
increasing our prices and gross profit margins in the future.





Expenses:





Our net
loss for the quarter ended June 30, 2010 was $901,448 compared to $1,102,004 for
the previous quarter ended June 30, 2009, a decrease of 18% due to fewer non
cash expense charged to general and administrative expenses described below. For
the six months ended June 30, 2010, net loss decreased 9% over the comparable
2009 six month period, from $2,006,567 to $1,831,838 for the same reason as the
decrease in the three month periods.





The
decreases in net loss between both the three and six months comparative periods
are primarily attributable to decrease in General and Administrative expenses
the result a general decrease in spending especially for legal and travel but
also including a reduction of  non-cash charges to expense for
issuance of equity securities. The overall decrease also includes an approximate
10% reduction in marketing expenses resulting from a reduction in print
advertising and collateral materials between both the comparable periods.
Research and Development expense remained fairly constant between both
comparative periods, decreasing 5% between the six month periods, with no new
programs being undertaken. Depreciation expense remained fairly constant,
increasing 9% between the six month periods,  with only one iPura
system having been installed and depreciated but will increase as additional
systems are installed. Interest expense increased approximately 150% in both
comparative periods reflecting the increase debt levels  and is
expected to increase substantially as the trade finance and equipment finance
debt facilities are expanded. The cash used in operations increased by
approximately 50% from $1,858,386 to $920,024 between the six month periods
ended June 30, 2009 and 2010, respectively, resulting from a
substantial  increase in 2010 of accounts payable and accrued
liabilities used to fund operations.





Off
Balance Sheet Arrangements





We do not
have any off-balance sheet arrangements.





Customer
and Supplier Concentration





Our
revenue for the quarter ended June 30, 2010 was derived from a limited number
of  customers, with approximately 39% of our total revenue
attributable to one customer, Safeway, Inc.  We expect this customer
concentration to continue in the short-term as we seek to expand our sales with
Safeway, Inc, but anticipate that customer concentration will eventually begin
to decline if we are able to expand our customer base and effectively market and
brand iPura.





All of
our inventory for the quarter ended June 30, 2010 was derived from one supplier
at its processing plant in China.  As described above, subject to
financial resources and obtaining purchase orders, we anticipate purchasing and
processing additional inventory from another supplier located in Vietnam by the
fourth quarter of 2010.   Therefore, we anticipate continued
dependence upon a very small number of suppliers.  The future loss of
any major customer or supplier could have a material adverse effect on our
business, financial condition and results of operations.




14


ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK





A smaller
reporting company is not required to provide the information required by this
Item.





ITEM
4. CONTROLS AND PROCEDURES





We
maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and
Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended, which we
refer to as the Exchange Act) that are designed to ensure that information
required to be disclosed in our periodic reports filed under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified
in the rules and forms of the SEC, and that this information is accumulated and
communicated to our management, including our principal executive/financial
officer, to allow timely decisions regarding required disclosure.





Our
management, with the participation and supervision of our Chief Executive
Officer and Chief Financial Officer (“Certifying Officers”), evaluated the
effectiveness of our disclosure controls and procedures as of the end of the
period covered by this Quarterly Report on Form 10-Q. In designing and
evaluating the disclosure controls and procedures, management recognized that
any controls and procedures, no matter how well designed and operated, can
provide only reasonable assurance of achieving the desired control objectives.
In addition, the design of disclosure controls and procedures must reflect the
fact that there are resource constraints and that management is required to
apply its judgment in evaluating the benefits of possible controls and
procedures relative to their costs.





Based
upon that evaluation, our Certifying Officers concluded that as of the end of
the period covered by this Quarterly Report, our disclosure controls and
procedures were not effective.   Our primary material weakness
has been due to our limited number of personnel and, therefore, segregation of
duties.





Changes
in Internal Control Over Financial Reporting




There was
no change in our internal control over financial reporting that occurred during
the period covered by this Quarterly Report on Form 10-Q that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting





PART
II - OTHER INFORMATION





ITEM
1.  LEGAL PROCEEDINGS





We are
not a party to any legal proceedings and, to our knowledge, no such proceedings
are threatened or contemplated against us.





ITEM
      1A.
            RISK
      FACTORS





A smaller
reporting company is not required to provide the information required by this
Item. However, please note the following about Forward-Looking Statements and
the following brief description of certain risks that could have a material,
adverse impact on the Company and its operations.




15


Cautionary
Information Regarding “Forward-Looking Statements”




This
Quarterly Report on Form 10-Q includes certain statements about us that may be
deemed to be “forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995.  These forward-looking
statements relate to matters such as, among other things, product development
and acceptance, our anticipated financial performance, business prospects,
technological developments, new products, future distribution or license rights,
international expansion, possible strategic alternatives, new business concepts,
capital expenditures, consumer trends and similar matters.





Forward-looking
statements necessarily involve known and unknown risks, uncertainties and other
factors that may cause our actual results, levels of activity, performance or
achievements to be materially different from any future results, levels of
activity, performance or achievement expressed or implied by these
forward-looking statements.  In some cases, you can identify
forward-looking statements by terminology such as “may,” “will,” “should,”
“could,” “intend,” “expect,” “anticipate,” “assume,” “hope,” “plan,” “believe,”
“seek,” “estimate,” “predict,” “approximate,” “potential,” “continue” or the
negative of these terms.  Statements including these words and
variations of these words, and other similar expressions, are forward-looking
statements.  Although we believe that the expectations reflected in
our forward-looking statements are reasonable based upon our knowledge of our
business, we cannot absolutely predict or guarantee any future results, levels
of activity, performance or achievements.  Moreover, neither we nor
any other person assumes responsibility for the accuracy and completeness of
these statements.





We note
that a variety of factors could cause our actual results and future experiences
to differ materially from the anticipated results or other expectations
expressed in these forward-looking statements. The risks and uncertainties that
may affect our operations, performance, development and results include, but are
not limited to, the following:





·
            whether
      we will be able obtain additional financing to continue or expand
      operations and to finance inventory costs, and the terms on which we will
      be able to obtain this financing, if at
all;




·
            whether
      our initial system installation will perform as expected in commercial
      applications;




·
            our
      ability to obtain any commercial financing to allow us to purchase seafood
      inventory for processing in our iPuraTM System, and to
      obtain such financing in amounts required and on commercially reasonable
      terms;




·
            our
      dependence on a small number of customers and
  suppliers;




·
            our
      ability to negotiate contracts and purchase orders with distributors and
      retailers;




·
            our
      ability to obtain brand related premium pricing to yield an acceptable
      sales margin;




·
            risks
      related to inventory costs, shipping and handling and
      spoilage;




·
            our
      ability to obtain one or more third-party manufacturers for our system
      components and other products;




·
            the
      cost at which we will be able to have our system components and other
      products manufactured, if at all, and the time it will take to have our
      system components and other products
  manufactured;




16


·
            our
      ability to obtain all required components for our systems on a timely
      basis and at the prices we
anticipate;




·
            whether
      our systems and products are viewed as providing the benefits we claim and
      whether these benefits are marketable by any customers we may seek to
      obtain;




·
            our
      ability to enter into additional contracts with food processors, the time
      it takes for us to enter into any of these contracts and the licensing or
      pricing models we are able to
implement;




·
            our
      systems and products performing in the manner we expect in customer
      applications and without any material
  modifications;




·
            our
      ability to obtain all necessary governmental approvals for our systems and
      other products, including all required import-exporter licenses and
      permits;




·
            whether
      the introduction of the iPuraTM brand will succeed in
      creating preferences with the consuming
public;




·
            whether
      we will be able to apply our technology to products other than fish or use
      our technology in any other fields;




·
            the
      pace at which we will utilize our existing working capital and whether our
      existing working capital will be sufficient for us to continue to develop
      our systems and products to the extent we
  anticipate;




·
            our
      ability to protect our intellectual property and obtain and maintain
      patents and other protections for our intellectual
    property.




·
            the
      possible impact from competing products or
  technologies;




·
            possible
      reductions in consumer demand for fish and poultry, including as a result
      of  any outbreaks of disease, including avian flu, or negative
      reports regarding the health benefits of fish and
  poultry;




·
            our
      ability to hire, train and retain a consistent supply of reliable and
      effective employees, both domestically and in any countries in which we
      might be able to install one of our processing
  system;




·
            the
      risk of non-payment by, and/or insolvency or bankruptcy of, any of our
      future customers or others with indebtedness to
  us;




·
            the
      costs of complying with applicable labor laws and requirements, including,
      without limitation, with respect to health
care;




·
            economic
      and political instability in foreign countries or restrictive actions by
      the governments of foreign countries in which we may seek to conduct our
      business or obtain customers;




·
            changes
      in tax laws or the laws and regulations governing food processing and on
      income generated outside the United
States;




·
            general
      economic, business and social conditions in the United States and in
      foreign countries where we may conduct our
  business;




·
            fluctuation
      in interest rates, insurance, shipping, energy, fuel and other business
      utilities in any countries in which we conduct
  business;




·
            the
      stability of and fluctuations in currencies in which we conduct
      business;




17


·
            threats
      or acts of terrorism or war; strikes, work stoppages or slow downs by
      labor organizations in any countries in which we conduct business;
      and




·
            natural
      or man-made disasters that could adversely impact the industries or
      countries in which we conduct
business.




ITEM
2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS





Sales
of Unregistered Securities





During
the period covered by this Quarterly Report, we issued the following securities,
discussed below, which were not registered under the Securities Act of
1933.  We did not employ any form of general solicitation or
advertising in connection with the offer and sale of the securities described
below.  In addition, we believe the purchasers of the securities are
“accredited investors” for the purpose of Rule 501 of the Securities
Act.  For these reasons, among others, the offer and sale of the
securities listed below were made in reliance on the exemption from registration
provided by Section 4(2) of the Securities Act, Regulation D and/or Regulation S
promulgated by the Securities and Exchange Commission under the Securities
Act.





In the
three months ended June 30, 2010, a total of 16,667 shares of preferred stock
and 33,333 warrants to purchase common stock were issued in private placements
for total proceeds of $75,000. All stock and unit sales were at $4.50 per share
or unit. All warrants are exercisable for a three year term at a price of the
greater of $3.00 or 50% of the bid price on an approved public exchange or the
most recent private offering price if there is no exchange.





In the
three months ended June 30, 2010, a total of 46,250 shares of common stock were
issued for services to consultants. Related expense of approximately $208,124
was recorded as operating expenses in the quarter ended June 30,
2010.





Purchases
of Equity Securities





We are
required by the Securities Act of 1933 to disclose, in tabular format, any
repurchases of our securities during this reporting period. We did not
repurchase any of our securities during this reporting period, and accordingly,
we have eliminated such table.





ITEM
3.  DEFAULTS UPON SENIOR SECURITIES





During
the three month period ended March 31, 2010, there were no material defaults in
the payment of principal or interest, a sinking or purchase fund installment, or
any other material default not cured within 30 days or with the consent of the
lender, with respect to any of our indebtedness exceeding 5% of our total
assets. However, as noted above under “Liquidity and Capital Resources” in Part
I, Item 2, we have certain notes that are due upon demand, and we do not
currently have the resources to repay such notes if demands for immediate
payment in full were made.





ITEM
4.   RESERVED





ITEM
5.  OTHER INFORMATION





(a)    
  Information Required To Be Disclosed In A Report On Form 8-K, But
Not Reported





None




18


(b)       Item
407(c)(3) of Regulation S-K





During
our fiscal quarter covered by this Quarterly Report on Form 10-Q, there have not
been any material change to the procedures by which our security holders may
recommend nominees to our Board of Directors.


19





ITEM
6.  EXHIBITS





Exhibit
                                      No.
                                    
                                    Description3.1
      (1)
                                    
                                    Certificate
      of Amendment to Certificate of Incorporation dated August 18,
      2005.3.2
      (2)
                                    
                                    Certificate
      of Amendment to Certificate of Incorporation dated September 15,
      2005.3.3
      (3)
                                    
                                    Restated
      Certificate of Incorporation dated October 18, 2005.3.4
      (3)
                                    
                                    Second
      Amended and Restated Bylaws as of August 31, 2005.3.5
      (5)
                                    
                                    Restated
      Certificate of Incorporation dated October 18, 20053.6
      (5)
                                    
                                    Second
      Amended and Restated Bylaws as of August 31, 200531.1*
                                    
                                    Certification
      of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a), as
      adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
      2002.31.2*
                                    
                                    Certification
      of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a), as
      adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
      2002.32.1‡
                                    
                                    Certification
      of Chief Executive Officer and Chief Financial Officer pursuant to
      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
      the
      Sarbanes-Oxley  Act  of  2002





*
            Filed
      herewith


‡
            Furnished
      herewith





(1)
            Filed
      on August 19, 2005 as an exhibit to Global Food’s Report on Form 8-K and
      incorporated herein by reference.


(2)
            Filed
      on October 6, 2005 as an exhibit to Global Food’s Report on Form 8-K and
      incorporated herein by reference.


(3)
            Filed
      on November 23, 2005 as an exhibit to Global Food’s Report on Form 10-QSB
      and incorporated herein by
reference.


(4)
            Filed
      on December 11,2009, as an exhibit to our Report on Form 8-K and
      incorporated herein by reference


(5)
            Filed
      on November 23, 2005, as an exhibit to our Form 10-QSB and incorporated
      herein by reference




20





SIGNATURES





In
accordance with the requirements of the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.





GLOBAL
      FOOD TECHNOLOGIES, INC.Dated:    August
      12, 2010
                
                By:
                /s/ Keith MeeksKeith
      Meeks, President andChief
      Executive Officer(PRINCIPAL
      EXECUTIVE OFFICER)Dated:    August
      12, 2010
                
                By:
                /s/ Marshall F. SparksMarshall
      F. Sparks, Chief Financial Officer(PRINCIPAL
      ACCOUNTING OFFICER)




21