ONLINE DISRUPTIVE TECHNOLOGIES, INC. - FORM 10-Q

Attached files

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EXCEL - IDEA: XBRL DOCUMENT - ONLINE DISRUPTIVE TECHNOLOGIES, INC.	Financial_Report.xls
EX-31.1 - EXHIBIT 31.1 - ONLINE DISRUPTIVE TECHNOLOGIES, INC.	exhibit31-1.htm
EX-32.1 - EXHIBIT 32.1 - ONLINE DISRUPTIVE TECHNOLOGIES, INC.	exhibit32-1.htm

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

FORM 10-Q

[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2013

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE EXCHANGE ACT

For the transition period from _________ to ________

Commission File No. 000-54394

ONLINE DISRUPTIVE TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)

Nevada	27-1404923
(State or other jurisdiction	(I.R.S. Employer
of incorporation or organization)	Identification No.)

3120 S. Durango Drive, Suite 305, Las Vegas, Nevada 89117
(Address of principal executive offices) (zip code)

702-579-7900
(Registrant’s telephone number, including area code)

N/A
(Former name, former address and former fiscal year, if changed since last report)

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

Indicate by check mark whether the registrant has submitted electronically 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 [ x ] No [ ]

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

Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ] (Do not check if a smaller reporting company)	Smaller reporting company [ x ]

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities and Exchange Act of 1933 subsequent to the distribution of securities under a plan confirmed by a court.
Yes [ ] No [ ]

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer’s classes of common equity as of the latest practicable date: As of November 8, 2013, there were 82,636,433 shares of common stock, par value $0.001, outstanding.

iii

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION	1
ITEM 1. FINANCIAL STATEMENTS	1
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.	2
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	10
ITEM 4. CONTROLS AND PROCEDURES	10
PART II - OTHER INFORMATION	11
ITEM 1. LEGAL PROCEEDINGS	11
ITEM 1A. RISK FACTORS.	12
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	20
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	20
ITEM 4. MINE SAFETY DISCLOSURES	20
ITEM 5. OTHER INFORMATION	20
ITEM 6. EXHIBITS	21
SIGNATURES	23

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ONLINE DISRUPTIVE TECHNOLOGIES, INC.

(A Development Stage Company)

CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2013

(Unaudited)

Online Disruptive Technologies, Inc.
(A Development Stage Company)
Consolidated Balance Sheets
(Unaudited)
	September 30, 2013		December 31, 2012
	$		$
ASSETS

Current Assets
Cash and Cash Equivalents	909,680		414,478
VAT Receivable	9,066		161,827
Total Current Assets	918,746		576,305

Total Assets	918,746		576,305

LIABILITIES

Current Liabilities
Accounts Payable and Accrued Liabilities	322,173		466,578
Term Loan – Related Party (Note 6)	28,914		31,645
Loans Payable - Related Parties (Note 7)	-		400
Total Current Liabilities	351,087		498,623
Term Loan – Related Party (Note 6)	40,402		33,553
Total Liabilities	391,489		532,176

EQUITY

Authorized: 20,000,000 Preferred Shares, par value $0.001 500,000,000 Common Shares, par value $0.001
Issued and outstanding: Nil Preferred Shares 82,636,433 Common Shares (December 31, 2012: 82,636,433 Common Shares)	67,036		67,036
Additional Paid-in Capital	419,615		417,617
(Deficit) Accumulated During the Development Stage	(4,672,955	)	(3,969,179	)
Total Common Stockholders’ (Deficiency)	(4,186,304	)	(3,484,526	)

Non-Controlling Interests	4,713,561		3,528,655
Total Equity	527,257		44,129
Total Liabilities and Equity	918,746		576,305

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

F-2

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)
									For the period
	Three						Nine		from November
	months		Three months		Nine months		months		16, 2009
	ended		ended		ended		ended		(inception) to
	September		September		September		September		September 30,
	30, 2013		30, 2012		30, 2013		30, 2012		2013
General and Administrative Expenses	$		$		$		$		$
Accounting Fees	6,000		2,500		18,000		7,500		38,779
Audit & Tax Fees	4,035		3,751		25,735		18,188		92,086
Bank Fees	81		339		376		1,048		2,445
Amortization Expenses	-		50,000		-		51,495		3,490
Consulting Fees	146,353		33,333		431,977		58,333		701,759
Filing and Transfer Agent Fees	655		6,003		6,957		16,123		47,443
Legal Fees	14,993		21,194		83,899		42,356		230,027
Travel Expenses	-		2,679		3,754		6,395		24,529
Office and Miscellaneous Expense	1,677		825		4,288		785		8,461
Research and Development Expense	55,126		83,402		84,387		83,402		3,914,522
Marketing Expense	10,318		-		86,496		-		177,835
Insurance Expense	-		-		23,308		-		23,308
Stock-Based Compensation	(7,626	)	97,500		1,998		97,500		99,498
Meals & Entertainment Expenses	-		-		238		688		926
	231,612		301,526		771,413		383,813		5,365,108

(Loss) Before Other Expense	(231,612	)	(301,526	)	(771,413	)	(383,813	)	(5,365,108	)
Other Expense
Interest Expense	(1,866	)	(2,069	)	(5,577	)	(5,372	)	(22,784	)
Write-off of Website Development Costs	-		-		-		(5,485	)	(5,485	)
Gain related to dissolved subsidiary	-		-		430		-		430
Foreign Currency Gain (Loss)	(7,035	)	-		12,868		-		27,854
	(240,513	)	(303,595	)	(763,692	)	(394,670	)	(5,365,093	)

Net (Loss) and Comprehensive (Loss) for the Period	(240,513	)	(303,595	)	(763,692	)	(394,670	)	(5,365,093	)

Net (Loss) and Comprehensive (Loss) attributable to:
Common Stockholders	(221,643	)	(280,338	)	(703,776	)	(371,413	)	(4,672,955	)
Non-Controlling Interests	(18,870	)	(23,257	)	(59,916	)	(23,257	)	(692,138	)
	(240,513	)	(303,595	)	(763,692	)	(394,670	)	(5,365,093	)
Basic and Diluted Net Loss per Common Share	(0.00	)	(0.00	)	(0.00	)	(0.00	)

Weighted Average Number of Common Shares Outstanding – Basic and Diluted	82,636,433		48,423,177		82,636,433		36,211,638

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

F-3

Online Disruptive Technologies, Inc.
(A Development Stage Company)
Consolidated Statements of Equity (Deficiency)
For the period from November 16, 2009 to September 30, 2013
(Unaudited)
					(Deficit)
					Accumulated		Total
			Additional		During the		Common				Total
	Common Stock		Paid In		Development		Shareholders’		Non-Controlling		Equity
	Shares	Amount	Capital		Stage		Deficiency		Interests		(Deficiency)
		$	$		$		$		$		$
Shares issued for cash at $0.0001 per share on November 16, 2009	1,000	-	-		-		-		-		-
Shares issued for cash at $0.000025 per share on December 5, 2009	15,999,000	400	-		-		400		-		400
Net loss for the period	-	-	-		(1,179	)	(1,179	)	-		(1,179	)
Balance December 31, 2009	16,000,000	400	-		(1,179	)	(779	)	-		(779	)
Recapitalization – ODT	2,000,100	2,000	6,999		-		8,999		-		8,999
Imputed interest from shareholders	-	-	3,009		-		3,009		-		3,009
Net loss for the year	-	-	-		(66,056	)	(66,056	)	-		(66,056	)
Balance December 31, 2010	18,000,100	2,400	10,008		(67,235	)	(54,827	)	-		(54,827	)
Shares issued for cash at $0.01 per share on February 24^th, 2011	6,000,000	6,000	54,000		-		60,000		-		60,000
Imputed interest from shareholders	-	-	6,199		-		6,199		-		6,199
Restructured term loan – a related party	-	-	15,833		-		15,833		-		15,833
Net loss for the year	-	-	-		(100,394	)	(100,394	)			(100,394	)
Balance December 31, 2011	24,000,100	8,400	86,040		(167,629	)	(73,189	)	-		(73,189	)
Shares issued for cash at $0.001 per share on April 9, 2012	17,750,000	17,750	-		-		17,750		-		17,750
Shares issued for cash at $0.001 per share on May 23, 2012	12,000,000	12,000	-		-		12,000		-		12,000
Shares issued on debt settlement at $0.0075 per share on July 10, 2012	8,000,000	8,000	52,000		-		60,000		-		60,000
Shares issued for cash at $0.01 per share on July 23, 2012	3,413,000	3,413	30,717		-		34,130		-		34,130
Shares issued on debt settlement at $0.01 per share on July 23, 2012	500,000	500	4,500		-		5,000		-		5,000
Shares issued on debt settlement at $0.01 per share on November 16, 2012	14,873,333	14,873	133,860		-		148,733		-		148,733
Shares issued on debt settlement at $0.01 per share on November 23, 2012	2,100,000	2,100	18,900		-		21,000		-		21,000
Warrant certificate issued in subsidiary	-	-	-		-		-		2,998,682		2,998,682
Shares allotted and issued in subsidiary	-	-	-		-		-		1,162,192		1,162,192
Stock Option Expense			97,500				97,500				97,500
Share issuance costs	-		(5,900	)	-		(5,900	)			(5,900	)
Net loss for the year	-	-	-		(3,801,550	)	(3,801,550	)	(632,219	)	(4,433,769	)
Balance December 31, 2012	82,636,433	67,036	417,617		(3,969,179	)	(3,484,526	)	3,528,655		44,129
Shares allotted and issued in subsidiary	-	-	-		-		-		1,244,822		1,244,822
Stock Option Expense			1,998				1,998				1,998
Net loss for the period	-	-	-		(703,776	)	(703,776	)	(59,916	)	(763,692	)
Balance September 30, 2013	82,636,433	67,036	419,615		(4,672,955	)	(4,186,304	)	4,713,561		527,257

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

F-4

Online Disruptive Technologies, Inc.
(A Development Stage Company)
Consolidated Statements of Cash Flows
Unaudited
					From
					November
	Nine months		Nine months		16, 2009
	ended		ended		(inception) to
	September 30,		September 30,		September
	2013		2012		30, 2013
Cash flow from Operating Activities	$		$		$
Net loss for the period	(763,692	)	(394,670	)	(5,365,093	)
Adjustment for items not involving cash:
Stock-Based Compensation	1,998		97,500		99,498
Shares Issued for Consulting Services	-		-		234,733
Imputed Interest	4,118		4,559		20,294
Research and Development Expense	-		-		2,998,682
Gain related to dissolved subsidiary	(430	)	-		(430	)
Amortization – Intangible Assets			50,000		-
Amortization – Website Development Costs	-		1,495		3,490
Write-off of Website Developments Costs	-		5,485		5,485
Changes in non-cash working capital items:
(Increase) decrease in VAT receivable	152,761		(14,178	)	(9,066	)
Increase (decrease) in Accounts Payable and Accrued Liabilities	(144,375	)	79,546		311,746
Net Cash (Used in) Operating Activities	(749,620	)	(170,263	)	(1,700,661	)
Cash flow from Financing Activities
Common Shares Issued, Net of Issuance Costs	-		57,981		118,380
Non-Controlling Interests	1,244,822		958,743		2,407,014
Increase (Decrease) in Loan Payable – Related Parties	-		-		74,462
Share subscription received	-		25,000		-
Net Cash Provided by Financing Activities	1,244,822		1,041,724		2,599,856
Cash flow from Investing Activities
Cash Acquired on Acquisition of A Subsidiary	-		-		14,910
Website Development Costs	-		-		(4,425	)

Net Cash Provided by Investing Activities	-		-		10,485

Net Increase in Cash and Cash equivalents	495,202		871,461		909,680

Cash and Cash equivalents, Beginning of Period	414,478		7,492		-
Cash and Cash equivalents, End of Period	909,680		878,953		909,680
Supplementary Information
Interest Paid	-		-		-
Income Taxes Paid	-		-		-

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

F-5

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 1 - Nature of Operations

Online Disruptive Technologies, Inc. (“ODT” or the “Company”) was incorporated on November 16, 2009 in the State of Nevada, U.S.A. The Company was in the business of operating websites with advertising revenue platforms. However, as described below, the Company changed its primary business focus to the development and commercialization of a biotechnology platform. The Company has limited operations and in accordance with ASC 915, is considered a development stage company that has had no revenues from inception to date. The Company has a December 31 year-end.

Effective March 24, 2010, the Company acquired 100% of the issued and outstanding shares of RelationshipScoreboard.com Entertainment Inc. (“RS” or “RelationshipScoreboard.com”), a company incorporated on November 16, 2009 in the state of Nevada, U.S.A. in exchange for 16,000,000 shares of the Company’s common stock. Upon the completion of the acquisition, the former sole shareholder of RS held 89% of the Company’s issued and outstanding common stock. As a result, the transaction was accounted for as a reverse takeover transaction (“RTO”) for accounting purpose, as RS was deemed to be the acquirer, and these consolidated financial statements are a continuation of the financial statements of RS. On January 28, 2013, RelationshipScoreboard.com was closed and dissolved. The Company sold the website assets for $10 to an arm’s length individual and wrote off $430 supplier payable.

On April 23, 2012, the Company established an Israeli subsidiary named Savicell Diagnostic Ltd. (“Savicell”) with the intent of exploring business ventures in the biotechnology sector. On July 25, 2012, Savicell entered into a definitive licensing agreement with a division of Tel Aviv University for the purpose of developing and commercializing a new technology relative to the early detection of various forms of disease. With the consummation of this transaction, the Company is now primarily focused on its biotechnology efforts.

These financial statements have been prepared with the ongoing assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. The Company suffered a recurring loss and had positive working capital of $567,659 as at September 30, 2013 (December 31, 2012 –positive working capital of $77,682). Furthermore, additional future losses are anticipated which raise substantial doubt about the Company’s ability to continue as a going concern. These financial statements do no include any adjustments to the amounts and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern.

F-6

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 1 - Nature of Operations (Continued)

The operations of the Company have primarily been funded by the sale of common shares and loans received. Continued operations of the Company are dependent on the Company’s ability to complete equity financings or to generate profitable operations in the future. Management’s plan in this regard is to secure additional funds through future equity financings. Such financings may not be available or may not be available on reasonable terms to the Company.

In January of 2013, the Company commenced a process to effect a change of name. In order to do so, the Company incorporated a new Nevada subsidiary named Savicell, Inc. with the intention of then amalgamating with the subsidiary. ODT will be the surviving entity and will subsequently carry on business under the name Savicell, Inc.

Note 2 – Acquisition - ODT

In connection with the RTO described above and prior to the acquisition, ODT had no business and did not meet the definition of a business under ASC 805, “Accounting for Business Combinations”. Accordingly, the reverse takeover of ODT by RS has been accounted for as a capital transaction, in respect of which the net assets of ODT on March 24, 2010 were accounted for as a recapitalization of RS. A breakdown of ODT’s net assets as at March 24, 2010 is as follows:

		March 24, 2010
Total assets – cash only	$	14,910
Total liabilities		(5,911	)
Net assets acquired	$	8,999

F-7

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 3 - Significant Accounting Policies

a) Basis of Presentation
These financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“US GAAP”). All adjustments considered necessary for a fair presentation of financial position, results of operations and cash flows as at September 30, 2013 have been included.

b) Principles of Consolidation
These consolidated financial statements include the accounts of the Company, its wholly-owned subsidiary RS until January 28, 2013, Savicell Inc. and its 75.88% interest in Savicell. All significant intercompany accounts and transactions have been eliminated upon consolidation.

c) Use of Estimates
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

d) Foreign Currency Translation
The Company and its subsidiaries’ functional currency are U.S. dollars. Transactions in other currencies are recorded in U.S. dollars at the rates of exchange prevailing when the transactions occur. Monetary assets and liabilities denominated in other currencies are translated into U.S. dollars at rates of exchange in effect at the balance sheet dates. Exchange gains and losses are recorded in the statements of operations.

e) Cash and Cash Equivalents
Cash and cash equivalents consist entirely of readily available cash balances. There were no cash equivalents as at September 30, 2013 and December 31, 2012.

F-8

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements - Audited

September 30, 2013

(Unaudited)

Note 3 - Significant Accounting Policies (Continued)

f) Stock-based Compensation
The Company accounts its stock options and similar equity instruments issued in accordance with ASC 718, “Share-Based Payment”. Accordingly, compensation costs attributable to stock options or similar equity instruments granted are measured at the fair value at the grant date, and expensed over the expected vesting period. ASC 718 requires excess tax benefits be reported as a financing cash inflow rather than as a reduction of taxes paid.

As at and for the year ended December 31, 2012, the Company has issued 9,750,000 stock options and incurred stock compensation expense of $97,500 in 2012. For the nine month period ended September 30, 2013, the Company granted 1,762,358 options and incurred stock compensation expense of $1,998 (Also see note 9).

g) Revenue Recognition
Operating revenue previously consisted of advertising revenue. The Company currently has no ongoing revenues. The point in time at which revenues are recognized is determined in accordance with ASC 605-10 (formerly Staff Accounting Bulletin No. 104, “Revenue Recognition”). Revenues are recorded when the Company delivers services to its customers and collection is reasonably estimated.

h) Income Taxes
Income taxes are accounted for under the liability method of accounting for income taxes. Under the liability method, deferred tax liabilities and assets are recognized for the estimated future tax consequences attributable to differences between the amounts reported in the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted or substantially enacted income tax rates expected to apply when the asset is realized or the liability is settled. The effect of a change in income tax rates on deferred income tax liabilities and assets is recognized in income in the period in which the change occurs.

F-9

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements - Audited

September 30, 2013

(Unaudited)

Note 3 - Significant Accounting Policies (Continued)

h) Income Taxes (continued)
Deferred income tax assets are recognized to the extent that they are considered more likely than not to be realized.

The Financial Accounting Standards Board (FASB) has issued FASB ASC 740-10, “Accounting for Uncertainty in Income Taxes”. ASC 740-10 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with prior literature FASB Statement No. 109, Accounting for Income Taxes. This standard requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements. The implementation of this standard had no impact on the Company’s financial statements.

i) Comprehensive Income (Loss)
The Company accounts for comprehensive income under the provisions of ASC Topic 220-10, Comprehensive Income - Overall, which establishes standards for reporting and display of comprehensive income, its components and accumulated balances. The Company is disclosing this information on its Statements of Operations and Comprehensive Loss.

j) Earnings (Loss) Per Share
Basic loss per share is computed on the basis of the weighted average number of common shares outstanding during each period.

Diluted loss per share is computed on the basis of the weighted average number of common shares and dilutive securities outstanding. Stock options are considered to be common stock equivalents and were not included in the net loss per share calculation for the nine month periods ended September 30, 2013 and 2012 because the inclusion of such underlying shares would have had an anti-dilutive effect.

F-10

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements - Audited

September 30, 2013

(Unaudited)

Note 3 - Significant Accounting Policies (Continued)

k) Financial Instruments and Fair Value of Financial Instruments
Fair Value of Financial Instruments – the Company adopted SFAS ASC 820-10-50, “Fair Value Measurements”. This guidance defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:

Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3 inputs to valuation methodology are unobservable and significant to the fair measurement.

As at September 30, 2013, the fair value of cash and cash equivalents was measured using Level 1 inputs.

The carrying amounts reported in the consolidated balance sheets for the cash and cash equivalents, accounts payable and accrued liabilities, loans payable and term loan each qualify as financial instruments and are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization.

F-11

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 3 - Significant Accounting Policies (Continued)

l) Website Development Costs
Website development costs relate to the development of the Company's proprietary website. These costs had been capitalized as incurred and installed and were, prior to being written off in full (see Note 4 below), amortized over the estimated useful life of three years on a straight line basis. The Company accounts for these costs in accordance with ASC 350, Intangibles, which specifies the appropriate accounting for costs incurred in connection with the development and maintenance of websites.

m) Research and Development Costs
All research and development costs are charged to expense as incurred and consist principally of costs related to the License and Research Funding Agreement entered by the Company’s subsidiary with Ramot at Tel Aviv University (See Note 5).

n) Recently Adopted Accounting Pronouncements
In December 2011, the FASB issued ASU 2011-11 "Disclosures about offsetting assets and liabilities". Under the new guidance entities must disclose both gross information and net information on instruments and transactions eligible for offset on the balance sheet in accordance with the offsetting guidance in ASC 210-20-45 or ASC 815-10-45, and instruments and transactions subject to an agreement similar to a master netting arrangement. The new guidance will be effective for ASMI beginning January 1, 2013. The Company adopted ASU 2011-11 on January 1, 2013 and the adoption of the new amendments did not have a significant impact on our consolidated financial statements.

F-12

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 3 - Significant Accounting Policies (Continued)

n) Recently Adopted Accounting Pronouncements (continued)

In July, 2012, the FASB issued ASU 2012-02, “Intangibles – Goodwill and Other (Topic). ASU 2012-02 amends the required annual impairment testing of indefinite-lived intangible assets by providing an entity an option to first assess qualitative factors to determine whether it is more likely than not that the fair value of the indefinite-lived asset is less than its carrying amount. If, after assessing the totality of events and circumstances, an entity determines it is not more likely than not that the fair value of the indefinite-lived asset is less than its carrying amount, then performing the two-step impairment test under Topic 350-30 is unnecessary. However, if an entity concludes otherwise, then it is required to perform the impairment testing under Topic 350-30-35-18F by calculating the fair value of the reporting unit and comparing the results with the carrying amount. If the fair value exceeds the carrying amount, then the entity must perform the second step test of measuring the amount of the impairment test under Topic 350-30-35-19. An entity has the option to bypass the qualitative assessment and proceed directly to the two step goodwill impairment test. Additionally, the entity has the option to resume with the qualitative testing in any subsequent period. The pronouncement is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012 and early adoption is permitted. The Company adopted ASU 2012-02 on January 1, 2013 and the adoption of the new standard did not expect to have a material effect on the Company’s consolidated financial position or results of operations.

In October 2012, the FASB issued ASU 2012-04 "Technical corrections and improvements". This ASU makes certain technical correction to the FASB Accounting Standards Codification. The new guidance will be effective for fiscal years beginning after December 15, 2012. The Company adopted ASU 2012-04 on January 1, 2013 and the adoption of the new amendments is not expected to have a significant impact on our consolidated financial statements.

In February 2013, the FASB issued ASU 2013-02, "Comprehensive Income (Topic 220), Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income". The amendments do not change the current requirements for reporting net income or other comprehensive income in financial statements.

F-13

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 3 - Significant Accounting Policies (Continued)

n) Recently Adopted Accounting Pronouncements (continued)

However, the amendments require an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S.GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. The pronouncement is effective for fiscal years and interim periods ending after December 15, 2012. The Company adopted ASU 2013-02 on January 1, 2013 and the adoption of this pronouncement did not have a material effect on the Company's consolidated financial position or results of operations.

In March 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2013-05, "Foreign Currency Matters (Topic 830); Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity." This guidance applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business (other than a sale of in substance real estate or conveyance of oil and gas mineral rights) within a foreign entity. ASU No. 2013-05 is effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. We will adopt this guidance beginning with our fiscal quarter starting from April 1, 2014. We are currently reviewing the provisions of ASU No. 2013-05 on our consolidated financial statements.

F-14

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 3 - Significant Accounting Policies (Continued)

n) Recently Adopted Accounting Pronouncements (continued)

In July 2013, the FASB issued authoritative guidance under Accounting Standard Update ("ASU") 2013-11, which provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss (“NOL”) carryforward, a similar tax loss, or a tax credit carryforward exists. ASU 2013-11 requires entities to present an unrecognized tax benefit as a reduction of a deferred tax asset for a NOL or tax credit carryforward whenever the NOL or tax credit carryforward would be available to reduce the additional taxable income or tax due if the tax position is disallowed. This accounting standard update requires entities to assess whether to net the unrecognized tax benefit with a deferred tax asset as of the reporting date. ASU 2013-11 will be effective for the Company’s first quarter of fiscal 2014. The Company is currently evaluating the impact of this accounting standard update on its consolidated financial statements.

m) Recently Issued Accounting Pronouncements

Other accounting pronouncements that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s financial statements upon adoption.

Note 4 – Website Development Costs

The Company incurred and capitalized costs of $8,975 related to its website development. As at May 1, 2011, the development of the initial phase of the website was substantially completed. As such, the Company began amortizing the website cost over the estimated useful life of 3 years. As at June 30, 2012, the Company wrote off the remaining website development costs of $5,485 as a result of the Company changing its business focus. During the nine month period ended September 30, 2013, the Company sold the asset for nominal consideration. The following is a summary of website development assets.

F-15

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 4 – Website Development Costs (Continued)

		As of December 31, 2012
		Cost		Accumulated
				Amortization		Write-off		Net Book
								Value
Website development costs	$	8,975	$	3,490	$	5,485	$	-

Note 5 – License and Research Funding Agreement

On July 25, 2012, the Company’s subsidiary Savicell entered into a License and Research Funding Agreement (“R&D Agreement”) with Ramot at Tel Aviv University (“Ramot”) pursuant to which:

In the course of research performed at Tel-Aviv University ("TAU"), one of the chief professors has developed technology relating to early detection of diseases by measuring metabolic activity in the immune system;
Savicell wishes to fund further research at TAU relating to such technology; and
Savicell wishes to obtain a license from Ramot with respect to such technology and the results of such further funded research in order to develop and commercialize products in the diagnostics space, and Ramot wishes to grant the Company such license, all in accordance with the terms and conditions of this R&D Agreement.

Pursuant to the above noted R&D Agreement, Savicell will fund research expenditures amounting to a total of $1,600,000 according to the following schedule:

F-16

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 5 – License and Research Funding Agreement (Continued)

$81,000 within 5 business days of the R&D Agreement (paid)
Before October 2012; $359,500 plus VAT as applicable (paid)
Before January 3, 2013; $359,500 plus VAT as applicable (paid)
Before April 3, 2013; $400,000 plus VAT as applicable
Before July 3, 2013; $400,000 plus VAT as applicable

The payments originally due on April 3, 2013 and July 3, 2013 have been postponed by the parties until such time as the funds are actually required in furtherance of the joint research and development initiatives.

In addition, Savicell shall issue to Ramot warrants (the “Warrants”) to purchase a number of ordinary shares of Savicell which shall together comprise 15% of issued shares of Savicell on an as-converted, fully diluted basis (equivalent to 1,765 Warrant Shares of Savicell). The Warrants shall be exercisable at an exercise price equal to the par value of the Warrant Shares, at any time and from time to time or until Savicell completes a defined liquidity event. The fair value of the Warrant Shares has been estimated at $1,698.97 per Warrant Share which is equivalent to the price at which Savicell has issued shares to third party, for a total of $2,998,682.

Upon successful development and commercialization and in recognition of the rights and licenses granted to Savicell pursuant to this R&D Agreement, Savicell will be subject to certain royalty payments as specified in the Agreement.

For the year ended December 31, 2012, Savicell incurred research and development of $3,830,135 which included the funding of $831,453 in connection with R&D Agreement and the fair value ($2,998,682) of the Warrant Shares issued to Ramot. During the nine month period ended September 30, 2013, Savicell incurred research and development cost of $84,387 (September 30, 2012 -$83,402) which were included in the consolidated statements of operations and comprehensive loss.

F-17

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 6 – Term Loan – Related Party

On November 4, 2011, the Company entered into a loan Agreement (“Loan Agreement”) with a shareholder of the Company to settle a loan payable in the amount of $74,062. Pursuant to the Loan Agreement, the terms of repayment were amended to specify that ten per cent (10%) of the gross proceeds of any prospective debt or equity financing undertaken by ODT would be applied to the repayment of the principal of this loan until fully repaid. The term loan is unsecured, non-interest bearing and requires that any balance remaining outstanding on November 4, 2016 would then be fully due and payable.

The Company’s management has estimated that ODT will raise equity financing of $500,000 in each of 2013 and 2014 such that the loan payable will be fully repaid upon the equity raise in 2014. Management had determined the net present value of the term loan as at the date of restructuring to be $58,229 by discounting the future anticipated repayments at a relative market rate of 11.68% . As a result of the restructuring, the Company recorded $15,833 of additional paid-in capital. During the nine month ended September 30, 2013, the Company recorded interest accretion of $4,115 (September 30, 2012 - $4,560).

A summary of the Term Loan is as follows:

		September 30, 2013			December 31, 2012
Term loan – face value	$	74,062		$	74,062
Effective interest rate – 11.68%		(15,833	)		(15,833	)
Net present value		58,229			58,229
Interest accretion		11,087			6,969
Total		69,316			65,198
Current portion		28,914			31,645
Term loan – long term	$	40,402		$	33,553

F-18

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 7 – Loans Payable – Related Parties

During the period ended September 30, 2013, In connection with the dissolution of RS, a $400 loan payable owing to a shareholder of the Company was written off.

Note 8 – Related Party Transactions

The Company completed the following related party transactions:

During the nine month period ended September 30, 2013, the Company incurred consulting fees of $431,977 payable to its directors and officers and companies controlled by such directors and officers (for the nine month period ended September 30, 2012 - $58,333).

As at September 30, 2013, included in accounts payable and accrued liabilities, $69,533 (December 31, 2012- $12,833) was payable to a company controlled by a former director / officer of the Company and $241,500 (December 31, 2012-$Nil) was payable to officers or directors of the Company.

See Note 6, 7 and 10.

Note 9 –Equity

Common shares

On March 24, 2010, the Company issued 16,000,000 common shares (restricted shares) to the sole shareholder of RS to effect the acquisition and RTO. Prior to the acquisition and RTO (Note 1 and 2), RS engaged in the following equity transactions which have been restated using the exchange ratio established in the acquisition agreement to reflect 16,000,000 common shares issued in the reverse acquisition:

On November 16, 2009, RS issued 1,000 common shares at $0.0001 per share for total proceeds of $0.10.

F-19

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 9 –Equity (Continued)

Common shares (continued)

On December 5, 2009, RS issued 15,999,000 common shares at $0.000025 per share for total proceeds of $400.

Prior to the acquisition and RTO (Note 1 and 2), the Company engaged in the followings equity transactions:

On November 16, 2009, the Company issued 100 common shares at $0.001 per share for total proceeds of $0.10.
On December 2, 2009, the Company issued 200,000 common shares at $0.01 per share for total proceeds of $2,000.
On January 7, 2010, the Company issued 1,800,000 common shares at $0.01 per share for total proceeds of $18,000.

Upon the acquisition and RTO, 2,000,100 common shares issued by the Company prior to the acquisition were considered as a recapitalization to RS.

On February 24, 2011, the Company issued 6,000,000 common shares at $0.01 per share for total proceeds of $60,000.

On April 9, 2012, the Company issued 17,750,000 common shares at $0.001 per share for total proceeds of $17,750.

On May 23, 2012, the Company issued 12,000,000 common shares at $0.001 per share for total proceeds of $12,000.

The share issuance cost in connection with the issuance of 29,750,000 common shares was $5,900.

On July 10, 2012, the Company entered into debt settlement agreements with nine individuals whereby the Company collectively settled debts in the aggregate amount of $60,000 by the issuance of 8,000,000 common shares at a price per share of $0.0075. Included in the $60,000 total were the two related party loans of $25,000 each.

F-20

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 9 –Equity (Continued)

Common shares (continued)

On July 23, 2012, the Company issued 3,413,000 common shares at $0.01 per share for total proceeds of $34,130 and an additional 500,000 shares were issued as part of a debt settlement agreement in which $5,000 of an accounts payable debt was settled.

On November 16, 2012, the Company entered into debt settlement agreements with six employees or consultants of the Company whereby the Company collectively settled debts in the aggregate amount of $148,733 by the issuance of 14,873,333 common shares at a price per share of $0.01.

On November 23, 2012, the Company entered into debt settlement agreements with one director and one consultant of the Company pursuant to which the Company collectively settled debts in the aggregate amount of $26,000 by the issuance of 2,100,000 common shares at a price per share of $0.01 and a cash payment of $5,000.

As at September 30, 2013, the Company has 82,636,433 common shares issued and outstanding.

Stock Options

On September 1, 2012, the Company granted a total of 9,750,000 stock options to our directors, officers, consultants and employees. The stock options are exercisable at the exercise price of $0.01 per share until September 1, 2022 and vest immediately.

F-21

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 9 –Equity (Continued)

Stock Options (continued)

On May 28, 2013, the Company granted a total of 962,358 stock options to a consultant. The stock options are exercisable at an exercise price of $0.01 per share. A quarter of the options will vest on each of the first four anniversaries of the date of initial grant. The options were valued based on the Black Scholes model which utilizes the following assumptions: expected dividend yield of nil, expected volatility of 107%, expected life of 5years and risk free interest rate of 1.40% .

On August 22, 2013, the Company granted a total of 800,000 stock options to a consultant. The stock options are exercisable at the exercise price of $0.01 per share. 480,000 of the options so granted will vest as to one quarter of such options at the end of each completed year that the consultant provides the services. The remaining 320,000 options will vest based upon the completion of certain deliverables by the consultant. As at September 30, 2013, the Company recorded stock based compensation of $Nil for such options granted to the consultant, as the performance condition and the marketing condition have not yet been met as at September 30, 2013.

	Outstanding as at September 30, 2013
						Weighted
					Weighted	Average
	Number of	Number of			Average	Remaining
	Options	Options			Exercise	Contractual
Exercise price	outstanding	exercisable	Expire date		Price	Life (years)

$ 0.01	9,750,000	9,750,000	September 1, 2022	$	0.01	8.92
$ 0.01	962,358	-	May 28, 2018	$	0.01	4.66
$ 0.01	800,000	-	August 22, 2018	$	0.01	4.90

	11,512,358	9,750,000		$	0.01	7.74

F-22

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 9 –Equity (Continued)

Non-Controlling Interests

The Company’s subsidiary, Savicell, granted a third party a warrant certificate to purchase 1,765 common shares of Savicell that initially represented 15% of the underlying common equity of Savicell. On October 30, 2012, Savicell issued a total of 592 ordinary shares (the “Initial Closing”) to other third parties at $1,698.97 per share representing approximately 4.79% of the fully diluted common equity of Savicell for aggregate proceeds of $1,005,795. The Savicell investors are entitled to convert their Savicell shares into common shares of ODT at a price equal to 80% of the per share pricing of the first completed ODT financing of over $500,000 conducted after July 1, 2012 (the “Financing Price”) provided that for purposes of such conversion, the deemed maximum Financing Price shall be the per share price of the common shares of ODT based on (a) an aggregate ODT equity valuation of $30,000,000; and (b) the number of common shares of ODT outstanding at the time of the financing. Savicell continued its equity issuances following the Initial Closing.

As at December 31, 2012, Savicell issued a total of 684 shares at $1,698.97 per share representing approximately 5.23% of the fully diluted common equity of Savicell for aggregate proceeds of $1,162,192.

In the nine month period ended September 30, 2013, Savicell issued a total of 730 shares at $1,698.97 per share representing approximately 5.54% of the fully diluted common equity of Savicell for aggregate proceeds of $1,244,822. Following these share issuances, the Company, the Warrant holder and the Savicell investors held underlying interests in the equity of Savicell of 75.88%, 13.39% and 10.73% respectively.

As the exercise price inherent in warrant certificate to purchase 1,765 common shares of the Savicell is at nominal value, the warrant certificate is valued at the price of the subsequent equity issuance by Savicell ($1,698.97 per share) and the related common shares are deemed to be issued and outstanding.

F-23

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 10 – Commitments and Guarantees

The Company is not a guarantor to any parties as at September 30, 2013.

	1.	Effective November 1, 2011, the Company entered into a consulting agreement with 1367826 Ontario Limited (“OntarioCo”) pursuant to which OntarioCo is to provide certain consulting services to the Company including the provision of accounting, financial and regulatory advice. As consideration for the performance of the consulting services under the agreement, ODT agreed to pay OntarioCo the sum of $4,166.67 per month for the duration of the agreement, exclusive of any applicable sales tax. The agreement is for an indefinite period unless terminated by either party with sixty days advance written notice to the other party. Effective October 1, 2012 the quantum of the monthly fees was increased to $9,000 in recognition of the expanded scope of the Company’s activities.

	2.	Effective November 1, 2011, the Company entered into a consulting agreement with a third party, Kerry Chow, pursuant to which she will provide the following consulting services to ODT: maintaining the accounting books and records on behalf of our company and our subsidiaries; preparing consolidated quarterly and annual financial statements for our company and our subsidiaries as well as assisting in the preparation of the related disclosure documents; coordinating the quarterly reviews and annual audits on behalf of our company and our subsidiaries; coordinating the preparation and filing of the annual income tax returns of our company and our subsidiaries; and any other accounting-related functions. As consideration for the performance of the consulting services under the agreement, ODT agreed to pay Kerry Chow the sum of $833.33 per month for the duration of the agreement, exclusive of any applicable sales tax. The agreement is for an indefinite period unless terminated by either party with sixty days advance written notice to the other party. Effective October 1, 2012, the quantum of the monthly fee was increased to $2,000 in recognition of the expanded scope of the Company’s activities.

F-24

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 10 – Commitments and Guarantees (Continued)

	3.	On September 11, 2012, ODT signed an employment agreement with Giora Davidovits, its new chief executive officer and President, which agreement entailed an effective date of September 1, 2012. In return for acting as its chief executive officer, the Company will provide Mr. Davidovits an annual salary of $250,000 together with other benefits and the potential for additional bonuses as declared from time to time by the Company’s board of directors. The agreement will end on August 31, 2017 unless terminated early in accordance with the termination provisions contained within the employment agreement.

	4.	On October 30, 2012, ODT and Savicell signed an employment agreement with Eyal Davidovits, its new chief operating officer, which agreement entailed an effective date of September 1, 2012. In return for acting as its chief operating officer, the Company will provide Mr. Davidovits an annual salary, denominated in new Israeli shekels, approximately equal to $108,000 together with other benefits and the potential for additional bonuses as declared from time to time by the Company’s board of directors. The agreement will end on August 31, 2017 unless terminated early in accordance with the termination provisions contained within the employment agreement.

	5.	On November 8, 2012, ODT and Savicell signed an employment agreement with Dr. Irit Arbel, its new vice president, research and development, which agreement entailed an effective date of September 1, 2012. In return for acting as its new vice president, research and development officer, the

F-25

Online Disruptive Technologies, Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

September 30, 2013

(Unaudited)

Note 10 – Commitments and Guarantees (Continued)

Company will provide Dr. Arbel an annual salary, denominated in new Israeli shekels, approximately equal to $96,000 together with other benefits and the potential for additional bonuses as declared from time to time by the Company’s board of directors. The agreement will end on August 31, 2017 unless terminated early in accordance with the termination provisions contained within the employment agreement.

Note 11 – Subsequent Events

In April of 2013, Rami Hadar agreed to join the board of directors of Savicell, subject to the approval of the shareholders of Savicell. In conjunction with such appointment, on April 25, 2013 the Company reserved for issuance to Mr. Hadar options to acquire 1,924,717 common shares at a per share price of $0.01. The subject stock options entail a term of 7 years with 25% vesting immediately and a further 25% vesting on each of the first three anniversaries of the date of initial grant. As at September 30, 2013, the shareholders of Savicell had yet to approve Rami Hadar’s directorship. As such, the stock options granted to Mr. Hadar have not yet been issued. The approval was finally granted in November of 2013.

F-26

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

Forward Looking Statements

This report on Form 10-Q contains forward-looking statements. Forward-looking statements are projections in respect of future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. Forward-looking statements made in this Form 10-Q include statements about:

our marketing plan;
our anticipation that future broad clinical trial studies encompassing larger populations of cancer patients with varying cancers should reveal the full potential of the existing developed strategy;
our plans to hire industry experts and expand our management team;
our beliefs regarding the future of our competitors;
our belief that there is a large unmet need in cancer diagnostics exists in early diagnosis; accurate diagnosis;
our belief that there is a need in this segment for an easier blood-based test that will increase compliance and minimize discomfort;
our anticipated development schedule;
our expectation that the demand for our products will eventually increase; and
our expectation that we will be able to raise capital when we need it.

These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors” and the risks set out below, any of which may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These risks include, by way of example and not in limitation:

general economic and business conditions;
our ability to identify attractive products and negotiate their acquisition or licensing;
our ability to effectively develop our products;
volatility in prices for our products;
risks inherent in the pharmaceutical industry;
competition for, among other things, capital, pharmaceutical products and skilled personnel; and
other factors discussed under the section entitled “Risk Factors”.

While these forward-looking statements and any assumptions upon which they are based are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

As used in this interim report on Form 10-Q and unless otherwise indicated, the terms “we”, “us” and “our” refer to Online Disruptive Technologies Inc., our subsidiary, Savicell Diagnostic Ltd., an Israeli corporation (the “Subsidiary” or “Savicell”) and our subsidiary, Savicell Inc., a Nevada corporation. Unless otherwise specified, all dollar amounts are expressed in United States dollars.

Corporate Overview

We were incorporated in the State of Nevada on November 16, 2009 under the name “Online Disruptive Technologies, Inc.” with authorized capital of 500,000,000 shares of common stock with a par value of $0.001 per share and 20,000,000 shares of preferred stock with a par value of $0.001 per share. On March 24, 2010, we entered into a share purchase agreement with Benjamin Cherniak, whereby we acquired all of the issued and outstanding shares of RelationshipScoreboard.com Entertainment, Inc. in consideration for the issuance of 16,000,000 of our common shares. RSE was incorporated in the State of Nevada on November 16, 2009. There were no related party interests in the acquisition of RelationshipScoreboard.com Entertainment, Inc.

Pursuant to a license agreement and research funding agreement (the “License Agreement”) dated July 24, 2012 but entered into on July 25, 2012 executed by our Subsidiary and Ramot at Tel Aviv University Ltd. (“Ramot”), a private company incorporated in the State of Israel and having a place of business at 5 Shenker Street, Herzliah, Israel, our Subsidiary was granted a license to certain patented technology relating to the early detection of diseases by measuring metabolic activity in the immune system (the “Technology”). The products (the “Products”) means any instrument, device, process, method, product, component, or system that contain or is based on, in whole or in part, the Technology.

As consideration for the worldwide exclusive license of the Products, our Subsidiary will pay, issue and fund the following to Ramot:

	(a)	a royalty (the “Royalty”) on worldwide net sales of the Products by our company and its affiliates or sublicensee;

	(b)	a minimum annual royalty, credited against the Royalty;

	(c)	percentages of all payments received in connection with a sublicense;

	(d)	issue warrants to purchase, for nominal consideration, the number of common shares of the Subsidiary such that Ramot holds a minority interest in the Subsidiary; and

	(e)	fund research expenditures for the research of the Technology.

After the entry into of the License Agreement, we are focused on the development of Savicell.

Our Current Business

Savicell

Savicell uses a revolutionary diagnostic platform that is positioned initially in the cancer diagnostic market. The technology uses blood samples to rapidly measure the body's response to disease intrusion and cell malformation. The immune system is the first to “read” cancer and Savicell interprets the language of the immune system’s response.

Savicell technology is a ground-breaking, high-throughput, in-vitro test for rapid quantitative measurement of the metabolic activity of the cell populations that the body deploys to diagnose disease. Initial application will focus on cancer diagnostics using blood samples. The Savicell patent pending approach maps the different metabolic response profiles as a method for early diagnosis and staging.

The immune system is designed to detect disease intrusion and cell malformation in our bodies, which includes cancer, and to eliminate them. In reaction to the presence of cancer the immune system is energized to respond. The initial reaction is intricate, deploying different metabolic pathways and different subtypes of cells. It is these differential responses that Savicell technology powerfully detects. The immune system is the first to “read” cancer and Savicell interprets the language of the immune system’s response.

The clinical results obtained show the capability to simply and rapidly diagnose cancer in a preliminary large population of cancer patients in comparison to a control healthy group. We anticipate that future broad clinical trial studies involving larger populations of cancer patients with varying cancers should reveal the full potential of the existing developed strategy.

Obviously, many more tests are required in order to construct a meaningful and significant diagnostic classification. However, what is revealed to date is a major clear-cut shift of immune system metabolic activity pathways from oxidative phosphorylation to aerobic glycolysis between healthy patients and those with various cancer types.

Cancer Diagnostic Market

Cancer cases are increasing, with more than 20 million new cases predicted in 2025, compared to 12 million in 2008. (WHO) The worldwide in-vitro diagnostic market is estimated at $44 billion, growing 8% annually Market reseach.com press release Feb 7, 2012 – Yahoo Finance). The cancer diagnostic market is estimated at $8 billion annually and is the fastest growing segment (Kalorama Information Inc. news release March 12, 2008).

Cancer drug and diagnostic markets have grown impressively, driven by expanding patient populations and technological advances, especially in biomolecular medicine. Current treatments are better tolerated and more effective. The introduction of innovative products on the market is expected to continue and to drive double-digit annual growth. Helping to expand the treated patient population, 25 to 30 new anti-cancer agents are expected to be approved for a variety of new indications. (IMS Health Forecasts, Biopharma Forecasts & Trends). Expanding treatment options will further enhance growth of diagnostic products for monitoring treatment response, recurrence, and improved typing/staging. These enhanced treatment options will also accelerate market growth of companion diagnostics by linking sales of diagnostics to therapeutics (Dx-Rx model.). In 2010 alone, 25 companion diagnostics partnerships with pharma were established (pwc Diagnostics 2011 (PricewaterhouseCoopers LLP)).

Product innovations in cancer molecular diagnostics with biomarker discoveries have enhanced patient outcomes and helped drive market growth. However, the difficulty of discovering new bio-markers remains a significant limiting factor to growth. Importantly, the diagnostic efficacy of bio-markers in detecting cancer cells may be greater at relatively advanced stages of the disease, where the cancer growth is more pronounced.

We believe a significant and very large unmet need in cancer diagnostics exists in early diagnosis; accurate diagnosis, especially where technique-based biopsy limits accuracy; staging; diagnosis confirmation; recurrence and treatment monitoring; and tissue of origin diagnosis.

Early detection is very important because it can improve outcomes dramatically. Typically, more treatment options are available when diagnosed early and the resulting survival rates improve. Survival rate improves by at least four times when cancer is diagnosed early and before it has spread. (American Cancer Society) Key issues with current early diagnosis tests include low sensitivity, low specificity, discomfort (e.g., colonoscopy), exposure to radioactivity, and cost.

The early diagnosis market can be divided into two broad segments. One is cancers with commercialized diagnostic tests. These generate multibillion dollars that are significantly supported by the existence of guidelines. Breast and colon cancers are examples, with guidelines for mammograms yearly and colonoscopies every 5 to 10 years. There are 14.5 million annual screening tests for colon cancer in the USA (Anesth Analg 2008;106:434 –9). There are estimated at 40 million mammograms annually (FDA news release Feb. 11, 2011). We believe that there is a need in this segment for an easier blood-based test that will increase compliance and minimize discomfort.

The second segment is comprised of cancers that lack early diagnostic solutions. For example, lung and ovarian cancers do not have good screening tests and we believe represent a new market. Organizations that determine guidelines already support a screening regimen for ovarian cancer. So, once a reliable test is developed, market adaptation should be faster because the need has already been recognized. According to the American Cancer Society, it and "other health organizations, and ovarian cancer advocacy groups encourage additional research to develop an accurate and valid test for early detection of ovarian cancer."

Results of Operations

Revenues

We have not earned any revenue from operations since our inception and further losses are anticipated in the development of our business. We are currently in the development stage of our business and we can provide no assurances that we will generate revenue in the foreseeable future.

Expenses

For the three and nine months ended September 30, 2013 and 2012, we incurred the following expenses:

	Three months		Three months	Nine months	Nine months
	ended		ended	ended	ended
	September		September 30,	September 30,	September
	30, 2013		2012	2013	30, 2012
General and Administrative Expenses	$		$	$	$
Accounting Fees	6,000		2,500	18,000	7,500
Audit & Tax Fees	4,035		3,751	25,735	18,188
Bank Fees	81		339	376	1,048
Amortization Expenses	-		50,000	-	51,495
Consulting Fees	146,353		33,333	431,977	58,333
Filing and Transfer Agent Fees	655		6,003	6,957	16,123
Legal Fees	14,993		21,194	83,899	42,356
Travel Expenses	-		2,679	3,754	6,395
Office and Miscellaneous Expense	1,677		825	4,288	785
Research and Development Expense	55,126		83,402	84,387	83,402
Marketing Expense	10,318		-	86,496	-
Insurance Expense	-		-	23,308	-
Stock-Based Compensation	(7,626	)	97,500	1,998	97,500
Meals & Entertainment Expenses	-		-	238	688
	231,612		301,526	771,413	383,813

Following the incorporation of Savicell and the entering into of the License Agreement, the scope of consolidated activities increased markedly. As a result, there was a substantial increase in all aspects of professional fees and other compliance related expenses. We are now represented by counsel in both the United States as well as Israel. Given that Savicell has been undertaking continuous equity financing initiatives, heavier reliance has been placed on professionals and consultants in furtherance of such endeavors.

Liquidity And Capital Resources

Working Capital
		September 30,		December 31,
		2013		2012
Current Assets	$	918,746	$	576,305
Current Liabilities	$	351,087	$	498,623
Working Capital (Deficiency)	$	567,659	$	77,682

The working capital has increased primarily due to the ongoing equity issuances conducted by Savicell.

Cash Flows
		Nine Months			Nine Months
		ended			ended
		September 30,			September 30,
		2013			2012
Net Cash (Used in) Operating Activities	$	(749,620	)	$	(170,263	)
Net Cash Provided by Financing Activities	$	1,244,822		$	1,041,724
Net Cash Provided by (Used in) Investing Activities	$	-		$	-
Net Increase (Decrease) in Cash and Cash equivalents	$	495,202		$	871,461

Cash (Used in) Operating Activities

The increase in cash used in operating activities compared to the same period last year is due to the increased scope of activities including those of Savicell. Such increase has in turn led to sizeable augmentation of consulting fees and professional fees.

Cash Provided by Financing Activities

The increase in cash provided by financing activities compared to the same period last year results from the equity financings completed by Savicell in furtherance of its medical diagnostics research initiatives.

Financings

On October 30, 2012, we entered into a conversion and participation rights agreement (the “Agreement”) with 17 investors who have purchased ordinary shares (the “Savicell Shares”) of Savicell for gross proceeds of $1,005,795 (the “Initial Subscription Amount”). Savicell sold approximately 5% of its ordinary shares in total and our company retained about 80% of Savicell’s equity shares on a fully diluted basis after considering warrants issued to Ramot that can be exercised for the acquisition of ordinary shares of Savicell. Pursuant to the Agreement, we have permitted the investors to convert (the “Conversion Right”) the Savicell Shares into shares of our company (the “Online Shares”) as follows in respect of any particular investor:

A divided by B equals the number of Online Shares issuable on conversion of the Savicell Shares

where

A equals the portion of the Subscription Amount invested by the particular investor; and

B equals 80% of the per share pricing of the first completed financing of over US$500,000 conducted after July 1, 2012 (the “Financing”).

The deemed maximum per share price of the Financing shall be the per share price of Online assuming (a) an aggregate Online equity valuation of $30,000,000; and (b) the number of common shares of Online outstanding at the time of the Financing.

The investors may exercise the Conversion Right at any time during the period beginning on the date of the Agreement and ending on the earlier of (i) three years from the date of the Agreement; and (ii) on a date within ten business days if the average volume over a period of 30 trading days of our company’s shares on a United Sates stock exchange or quotation system totals 50,000 shares traded per day and the market capitalization of our company’s closing trading price on each such trading day multiplied by the number of common shares of our company totals a minimum of $40,000,000.

At any time commencing from the date of exercise of the Conversion Right by the investors until a date which is two years from the date of the Agreement, if our company wishes to raise financing by selling securities to the public in a non-brokered private placement (the “Private Placement”), we will offer to the investors the opportunity to participate in such Private Placement to the extent that the investor may retain its then currently held percentage of the outstanding Online Shares.

As at December 31, 2012, Savicell had issued total shares representing approximately 5.23% of the fully diluted common equity of Savicell for aggregate proceeds of $1,162,192.

In the nine month period ended September 30, 2013, Savicell issued additional shares representing approximately 5.54% of the fully diluted common equity of Savicell for aggregate proceeds of $1,244,822. Following these share issuances, the Company, Ramot and the Savicell investors held underlying interests in the fully diluted equity of Savicell of 75.88%, 13.39% and 10.73% respectively.

Plan of Operation

We are an early-stage company. There exists substantial doubt that we can continue as an on-going business for the next 12 months unless we obtain additional capital to pay our expenses. This is because we have not generated any revenues and no material revenues are anticipated until we further develop our business. There is no assurance we will reach this point.

Our primary objectives for the next 12 month period are to further develop the Technology and to advance the Technology so that it may be appropriate for clinical safety testing.

We estimate our operating expenses and working capital requirements for the next 12 months to be as follows:

Expense		Amount
Product development	$	2,000,000
Employee and consultant compensation		650,000
General and administration		75,000
Professional services fees		150,000
Regulation and compliance		50,000
Sales, Marketing and Business development		75,000
Total:	$	3,000,000

If we are not able to obtain the additional financing on a timely basis, if and when it is needed, we may be forced to cease the operation of our business.

Milestones for Development

The following is our anticipated development schedule:

Stage 1 0-6 months:

Finalize lab set up to expand the laboratory capability to enhance the sample processing capacity. This includes the purchasing of additional lab equipment and the recruitment of lab workers and company personnel required to analyze more samples. Continue with initial phase of clinical testing.

Stage 2 6-24 months:	Solidify preliminary results. This includes optimization of the reagent matrix for the metabolic profile (MA) identification of breast followed by lung cancer and optimization of data mining algorithm. Based on results, a decision will be made if we continue to stage 3 or adjust the plan based on the research findings.

Stage 3 24-36 months:	Verifying data on more patients: we anticipate concentrating on increasing the patient population and the number of test essays to a total of 1,100 patients.

Savicell has received approval of the Ethics Committee of the Institutional Review Board of the Tel Aviv Sourasky Medical Center to perform clinical trials on human blood for Savicell’s blood test for early diagnosis of breast cancer. No further approvals are necessary to commence clinical trials for a human blood test at the Sourasky Medical Center for the detection of breast cancer. Savicell commenced such trials during the month of August, 2013.

Going Concern

The financial statements accompanying this report have been prepared on a going concern basis, which implies that our company will continue to realize its assets and discharge its liabilities and commitments in the normal course of business. Our company has not generated revenues since inception and has never paid any dividends and is unlikely to pay dividends or generate earnings in the immediate or foreseeable future. The continuation of our company as a going concern is dependent upon the continued financial support from our shareholders, the ability of our company to obtain necessary equity financing to achieve our operating objectives, and the attainment of profitable operations. As at September 30, 2013, our company has accumulated deficit of $4,672,955 since inception. We do not have sufficient working capital to enable us to carry out our stated plan of operation for the next 12 months.

Due to the uncertainty of our ability to meet our current operating expenses and the capital expenses noted above in their report on the financial statements for the year ended December 31, 2012, our independent auditors included an explanatory paragraph regarding concerns about our ability to continue as a going concern. Our financial statements contain additional note disclosures describing the circumstances that lead to this disclosure by our independent auditors.

The continuation of our business is dependent upon us raising additional financial support. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

Future Financings

We will require additional financing to fund our planned operations, including further development, clinical testing, regulatory requirements, and commercializing our existing assets. We currently do not have committed sources of additional financing and may not be able to obtain additional financing, particularly, if the volatile conditions in the stock and financial markets, and more particularly the market for early development stage pharmaceutical company stocks persist.

There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, if and when it is needed, we will be forced to delay or scale down some or all of our development activities or perhaps even cease the operation of our business.

Since inception we have funded our operations primarily through equity and debt financings and we expect that we will continue to fund our operations through the equity and debt financing. If we raise additional financing by issuing equity securities, our existing stockholders’ ownership will be diluted. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

There is no assurance that we will be able to maintain operations at a level sufficient for an investor to obtain a return on his, her, or its investment in our common stock. Further, we may continue to be unprofitable.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

ITEM 4. CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

As required by paragraph (b) of Rules 13a-15 or 15d-15 under the Securities Exchange Act of 1934, our management, with the participation of our principal executive officer and principal financial officer evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, management concluded that as of the end of the period covered by this quarterly report on Form 10-Q, these disclosure controls and procedures were ineffective.

Because of the inherent limitations in all control systems, our management believes that no evaluation of controls can provide absolute assurance that all control issues, if any, within our company 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.

Management’s Report on Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over our financial reporting. In order to evaluate the effectiveness of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, our management, with the participation of our principal executive officer and principal financial officer has conducted an assessment, including testing, using the criteria in Internal Control — Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Our system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Our Management, including our principal executive officer and principal financial officer, conducted an evaluation of the design and operation of our internal control over financial reporting as of September 30, 2013 based on the criteria set forth in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. This evaluation included a review of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, our management concluded our internal control over financial reporting was not effective as at September 30, 2013 due to the following material weaknesses which are indicative of many small companies with small staff: (i) inadequate segregation of duties and ineffective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.

Our company plans to take steps to enhance and improve the design of our internal controls over financial reporting. During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we intend to implement the following changes during our fiscal year ending December 31, 2013: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out in (i) is largely dependent upon our company securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely effected in a material manner.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company 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.

This report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Our internal control over financial reporting was not subject to attestation by our independent registered public accounting firm pursuant to rules of the SEC that permit us to provide only management’s report in this report.

Changes in internal control over financial reporting

There were no changes in our internal control over financial reporting during the period ended September 30, 2013 that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We know of no material pending legal proceedings to which our company or our subsidiary is a party or of which any of our properties, or the properties of our subsidiary, is the subject. In addition, we do not know of any such proceedings contemplated by any governmental authorities.

We know of no material proceedings in which any of our directors, officers or affiliates, or any registered or beneficial stockholder is a party adverse to our company or our subsidiary or has a material interest adverse to our company or our subsidiary.

ITEM 1A. RISK FACTORS.

An investment in our common stock involves a number of very significant risks. You should carefully consider the following risks and uncertainties in addition to other information in this quarterly report on Form 10-Q in evaluating our company and our business before purchasing shares of our common stock. Our business, operating results and financial condition could be seriously harmed as a result of the occurrence of any of the following risks. You could lose all or part of your investment due to any of these risks. You should invest in our common stock only if you can afford to lose your entire investment.

Risks Related to our Company

The worldwide economic downturn may reduce our ability to obtain the financing necessary to continue our business and may reduce the number of viable products and businesses that we may wish to acquire. If we cannot raise the funds that we need or find a suitable product or business to acquire, we may go out of business and investors will lose their entire investment in our company.

Since 2008, there has been a downturn in general worldwide economic conditions due to many factors, including the effects of the subprime lending and general credit market crises, slower economic activity, decreased consumer confidence, reduced corporate profits and capital spending, adverse business conditions, increased unemployment and liquidity concerns. In addition, these economic effects, including the resulting recession in various countries and slowing of the global economy, will likely result in fewer business opportunities as companies face increased financial hardship. Tightening credit and liquidity issues will also result in increased difficulties for our company to raise capital for our continued operations. We may not be able to raise money through the sale of our equity securities or through borrowing funds on terms we find acceptable. If we cannot raise the funds that we need or find a suitable product or business to acquire, we will go out of business. If we go out of business, investors will lose their entire investment in our company.

Our independent auditors have expressed substantial doubt about our ability to continue as a going concern.

We have not generated any revenue from operations since our incorporation. We expect that our operating expenses will increase over the next 12 months as we ramp-up our business. We estimate our average monthly expenses over the next 12 months to be approximately $83,000, including general and administrative expenses but excluding acquisition costs and the cost of any research expenditures and product development. In addition, we anticipate expending $2,000,000 in aggregate research and development and product development costs. On September 30, 2013, we had cash and cash equivalents of $909,680. As of September 30, 2013, we had total debt of approximately $391,489. If we are unable to meet our debt service obligations and other financial obligations, we could be forced to restructure or refinance, seek additional equity capital or sell our assets. We might then be unable to obtain such financing or capital or sell our assets on satisfactory terms

We may need to raise additional funds in the future which may not be available on acceptable terms or at all.

We may consider issuing additional debt or equity securities in the future to fund potential acquisitions or investments, to refinance existing debt, or for general corporate purposes. If we issue equity or convertible debt securities to raise additional funds, our existing stockholders may experience dilution, and the new equity or debt securities may have rights, preferences and privileges senior to those of our existing stockholders. If we incur additional debt, it may increase our leverage relative to our earnings or to our equity capitalization, requiring us to pay additional interest expenses. We may not be able to market such issuances on favorable terms, or at all, in which case, we may not be able to develop or enhance our products, execute our business plan, take advantage of future opportunities, or respond to competitive pressures or unanticipated customer requirements.

We are an early-stage company with a limited operating history, which may hinder our ability to successfully meet our objectives.

We are an early-stage company with only a limited operating history upon which to base an evaluation of our current business and future prospects. As a result, the revenue and income potential of our business is unproven. In addition, because of our limited operating history, we have limited insight into trends that may emerge and affect our business. Errors may be made in predicting and reacting to relevant business trends and we will be subject to the risks, uncertainties and difficulties frequently encountered by early-stage companies in evolving markets. We may not be able to successfully address any or all of these risks and uncertainties. Failure to adequately do so could cause our business, results of operations and financial condition to suffer.

Because our directors and officers are not all residents of the United States, investors may find it difficult to enforce, within the United States, any judgments obtained against our directors and officers.

Our directors and officer are not all residents of the United States, and all or a substantial portion of their assets are located outside the United States. As a result, it may be difficult for investors to enforce within the United States any judgments obtained against our directors and officers, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state thereof.

If we are unable to successfully recruit and retain qualified personnel, we may not be able to continue our operations.

In order to successfully implement and manage our business plan, we will depend upon, among other things, successfully recruiting and retaining qualified personnel having experience in the pharmaceutical industry. Competition for qualified individuals is intense. We may not be able to find, attract and retain qualified personnel on acceptable terms. If we are unable to find, attract and retain qualified personnel with technical expertise, our business operations could suffer.

Future growth could strain our resources, and if we are unable to manage our growth, we may not be able to successfully implement our business plan.

We hope to experience rapid growth in our operations, which will place a significant strain on our management, administrative, operational and financial infrastructure. Our future success will depend in part upon the ability of our executive officers to manage growth effectively. This will require that we hire and train additional personnel to manage our expanding operations. In addition, we must continue to improve our operational, financial and management controls and our reporting systems and procedures. If we fail to successfully manage our growth, we may be unable to execute upon our business plan.

Risks Relating to our Operations in Israel

Conditions in Israel and the surrounding Middle East may materially adversely affect our Subsidiary’s operations and personnel.

Our Subsidiary has significant operations in Israel, including research and development. Since the establishment of the State of Israel in 1948, a number of armed conflicts and terrorist acts have taken place, which in the past, and may in the future, lead to security and economic problems for Israel. In addition, certain countries in the Middle East adjacent to Israel, including Egypt and Syria, recently experienced and some continue to experience political unrest and instability marked by civil demonstrations and violence, which in some cases resulted in the replacement of governments and regimes. Current and future conflicts and political, economic and/or military conditions in Israel and the Middle East region may affect our operations in Israel. The exacerbation of violence within Israel or the outbreak of violent conflicts involving Israel may impede our Subsidiary’s ability to engage in research and development, or otherwise adversely affect its business or operations. In addition, our Subsidiary’s employees in Israel may be required to perform annual mandatory military service and are subject to being called to active duty at any time under emergency circumstances. The absence of these employees may have an adverse effect on our Subsidiary’s operations. Hostilities involving Israel may also result in the interruption or curtailment of trade between Israel and its trading partners, which could materially adversely affect our results of operations.

The ability of our Subsidiary to pay dividends is subject to limitations under Israeli law and dividends paid and loans extended by our Subsidiary may be subject to taxes.

The ability of our Subsidiary to pay dividends is governed by Israeli law, which provides that dividends may be paid by an Israeli corporation only out of its earnings as defined in accordance with the Israeli Companies Law of 1999, provided that there is no reasonable concern that such payment will cause such subsidiary to fail to meet its current and expected liabilities as they come due. Cash dividends paid by an Israeli corporation to United States resident corporate parents are subject to provisions of the Convention for the Avoidance of Double Taxation between Israel and the United States, which may result in our Subsidiary having to pay taxes on any dividends it declares.

Risks Relating to the Pharmaceutical Business

If we are unable to successfully acquire, develop or commercialize new products, our operating results will suffer.

Our future results of operations will depend to a significant extent upon our ability to successfully develop and commercialize new products and businesses in a timely manner. There are numerous difficulties in, developing and commercializing new products, including:

there are still major developmental steps required to bring the product to a clinical testing stage;
clinical testing may not be positive;

developing, testing and manufacturing products in compliance with regulatory standards in a timely manner;
failure to receive requisite regulatory approvals for such products in a timely manner or at all;
developing and commercializing a new product is time consuming, costly and subject to numerous factors, including legal actions brought by our competitors, that may delay or prevent the development and commercialization of new products;
incomplete, unconvincing or equivocal clinical trials data;
experiencing delays or unanticipated costs;
significant and unpredictable changes in the payer landscape, coverage and reimbursement for our products;
experiencing delays as a result of limited resources at regulatory agencies; and
changing review and approval policies and standards at regulatory agencies.

As a result of these and other difficulties, products in development by us may or may not receive timely regulatory approvals, or approvals at all, necessary for marketing by us or other third-party partners. If any of our products are not approved in a timely fashion or, when acquired or developed and approved, cannot be successfully manufactured, commercialized or reimbursed, our operating results could be adversely affected. We cannot guarantee that any investment we make in developing products will be recouped, even if we are successful in commercializing those products.

Our expenditures may not result in commercially successful products.

We cannot be sure our business expenditures will result in the successful acquisition, development or launch of products that will prove to be commercially successful or will improve the long-term profitability of our business. If such business expenditures do not result in successful acquisition, development or launch of commercially successful brand products our results of operations and financial condition could be materially adversely affected.

Third parties may claim that we infringe their proprietary rights and may prevent us from manufacturing and selling some of our products.

The manufacture, use and sale of new products that are the subject of conflicting patent rights have been the subject of substantial litigation in the pharmaceutical industry. These lawsuits relate to the validity and infringement of patents or proprietary rights of third parties. Litigation may be costly and time-consuming, and could divert the attention of our management and technical personnel. In addition, if we infringe on the rights of others, we could lose our right to develop, manufacture or market products or could be required to pay monetary damages or royalties to license proprietary rights from third parties. Although the parties to patent and intellectual property disputes in the pharmaceutical industry have often settled their disputes through licensing or similar arrangements, the costs associated with these arrangements may be substantial and could include ongoing royalties. Furthermore, we cannot be certain that the necessary licenses would be available to us on commercially reasonable terms, or at all. As a result, an adverse determination in a judicial or administrative proceeding or failure to obtain necessary licenses could prevent us from manufacturing and selling our products, and could have a material adverse effect on our business, results of operations, financial condition and cash flows.

Extensive industry regulation has had, and will continue to have, a significant impact on our business, especially our product development, manufacturing and distribution capabilities.

All pharmaceutical companies are subject to extensive, complex, costly and evolving government regulation. For the U.S., this is principally administered by the FDA and to a lesser extent by the DEA and state government agencies, as well as by varying regulatory agencies in foreign countries where products or product candidates are being manufactured and/or marketed. The Federal Food, Drug and Cosmetic Act, the Controlled Substances Act and other federal statutes and regulations, and similar foreign statutes and regulations, govern or influence the testing, manufacturing, packing, labeling, storing, record keeping, safety, approval, advertising, promotion, sale and distribution of our products.

Under these regulations, we may become subject to periodic inspection of our facilities, procedures and operations and/or the testing of our products by the FDA, the DEA and other authorities, which conduct periodic inspections to confirm that we are in compliance with all applicable regulations. In addition, the FDA and foreign regulatory agencies conduct pre-approval and post-approval reviews and plant inspections to determine whether our systems and processes are in compliance with GMP and other regulations. Following such inspections, the FDA or other agency may issue observations, notices, citations and/or warning letters that could cause us to modify certain activities identified during the inspection. FDA guidelines specify that a warning letter is issued only for violations of “regulatory significance” for which the failure to adequately and promptly achieve correction may be expected to result in an enforcement action. We may also be required to report adverse events associated with our products to the FDA and other regulatory authorities. Unexpected or serious health or safety concerns would result in labeling changes, recalls, market withdrawals or other regulatory actions.

The range of possible sanctions includes, among others, FDA issuance of adverse publicity, product recalls or seizures, fines, total or partial suspension of production and/or distribution, suspension of the FDA’s review of product applications, enforcement actions, injunctions, and civil or criminal prosecution. Any such sanctions, if imposed, could have a material adverse effect on our business, operating results, financial condition and cash flows. Under certain circumstances, the FDA also has the authority to revoke previously granted drug approvals. Similar sanctions as detailed above may be available to the FDA under a consent decree, depending upon the actual terms of such decree. If internal compliance programs do not meet regulatory agency standards or if compliance is deemed deficient in any significant way, it could materially harm our business.

The product would be licensed for sale in the EU through an EC certification process, frequently shorthanded as “CE Mark” under the IVDD 98/79/EC. It is possible that general controls are sufficient and a conformity assessment of a QMS would be sufficient to support clinical testing in the EU. If a Notified Body must be used, the CE Marking process has two stages: a certification of the manufacturer’s QMS (ability to safely develop devices) and the certification of the device performance and safety itself. Regulatory approval may be delayed, limited or denied for a number of reasons, including insufficient clinical data, the product not meeting safety or efficacy requirements or any relevant manufacturing processes or facilities not meeting applicable requirements.

Further trials and other costly and time-consuming assessments of the product may be required to obtain or maintain regulatory approval. We may be required to conduct additional trials beyond those currently planned, which could require significant time and expense.

The diagnostic industry is highly competitive.

The diagnostic industry has an intensely competitive environment that will require an ongoing, extensive search for technological innovations and the ability to market products effectively, including the ability to communicate the effectiveness, safety and value of products to healthcare professionals in private practice, group practices and payers in managed care organizations, group purchasing organizations and Medicare & Medicaid services. We are smaller than almost all of our competitors. Most of our competitors have been in business for a longer period of time than us, have a greater number of products on the market and have greater financial and other resources than we do. Furthermore, recent trends in this industry are toward further market consolidation of large drug companies into a smaller number of very large entities, further concentrating financial, technical and market strength and increasing competitive pressure in the industry. If we directly compete with them for the same markets and/or products, their financial strength could prevent us from capturing a profitable share of those markets. It is possible that developments by our competitors will make any products or technologies that we acquire non-competitive or obsolete.

Even if our product candidates receive regulatory approval, they may still face future development and regulatory difficulties.

Even if U.S. regulatory approval or clearance is obtained, the FDA can impose significant restrictions on a product’s indicated uses or marketing or may impose ongoing requirements for potentially costly post-approval studies. Any of these restrictions or requirements could adversely affect our potential product revenues. Our product candidates will also be subject to ongoing FDA requirements for the labeling, packaging, storage, advertising, promotion, record-keeping and submission of safety and other post-market information on the drug. In addition, approved products, manufacturers and manufacturers’ facilities are subject to continual review and periodic inspections. If a regulatory agency discovers previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility where the product is manufactured, a regulatory agency may impose restrictions on that product or us, including requiring withdrawal of the product from the market. If our product candidates fail to comply with applicable regulatory requirements, such as current Good Manufacturing Practices, or “CGMPs”, a regulatory agency may:

issue warning letters or untitled letters;
require us to enter into a consent decree, which can include imposition of various fines, reimbursements for inspection costs, required due dates for specific actions and penalties for noncompliance;
impose other civil or criminal penalties;
suspend regulatory approval;
suspend any ongoing clinical trials;
refuse to approve pending applications or supplements to approved applications filed by us;
impose restrictions on operations, including costly new manufacturing requirements; or
seize or detain products or require a product recall.

Our commercialization efforts will be greatly dependent upon our ability to demonstrate product efficacy in clinical trials. Laboratories will be reluctant to order our products, and medical practitioners will be reluctant to prescribe our products, without compelling supporting data. The failure to demonstrate efficacy in our clinical trials, or a delay or failure to complete our clinical trials, would have a material adverse effect on our business, prospects, financial condition and operating results.

Our failure to convince medical practitioners to use our technologies will limit our revenue and profitability.

If we, or our commercialization partners, fail to convince medical practitioners to prescribe products using our technologies, we will not be able to sell our products or license our technologies in sufficient volume for our business to become profitable. We will need to make leading physicians aware of the benefits of products using our technologies through published papers, presentations at scientific conferences and favorable results from our clinical studies. Our failure to be successful in these efforts would make it difficult for us to convince medical practitioners to prescribe products using our technologies for their patients. Failure to convince medical practitioners to prescribe our products will damage our commercialization efforts and would have a material adverse effect on our business, prospects, financial condition and operating results.

We may not be able to market or generate sales of our products to the extent anticipated.

Assuming that we are successful in receiving regulatory clearances to market any of our products, our ability to successfully penetrate the market and generate sales of those products may be limited by a number of factors, including the following:

certain of our competitors in the field have already received regulatory approvals for and have begun marketing similar products, which may result in greater physician awareness of their products as compared to ours;
information from our competitors or the academic community indicating that current products or new products are more effective than our products could, if and when it is generated, impede our market penetration or decrease our existing market share;
the price for our products, as well as pricing decisions by our competitors, may have an effect on our revenues; and
our revenues may diminish if third-party payers, including private health coverage insurers and health maintenance organizations, do not provide adequate coverage or reimbursement for our products.

If any of our future marketed products were to experience problems related to their efficacy, safety, or otherwise, or if new, more effective treatments were to be introduced, our revenues from such marketed products could decrease.

If any of our current or future marketed products become the subject of problems, including those related to, among others:

efficacy or safety concerns with the products, even if not justified;
regulatory proceedings subjecting the products to potential recall;
publicity affecting doctor prescription or patient use of the product;
pressure from competitive products; or
introduction of more effective tests.

Our revenues from such marketed products could decrease. For example, efficacy or safety concerns may arise, whether or not justified, that could lead to the recall or withdrawal of such marketed products. In the event of a recall or withdrawal of a product, our revenues would significantly decline.

Risks Relating to our Common Stock

If we issue additional shares in the future, it will result in the dilution of our existing shareholders.

Our articles of incorporation authorize the issuance of up to 500,000,000 shares of common stock with a par value of $0.001 per share and 20,000,000 shares of preferred stock with a par value of $0.001 per share. Our board of directors may choose to issue some or all of such shares to acquire one or more companies or products and to fund our overhead and general operating requirements. The issuance of any such shares will reduce the book value per share and may contribute to a reduction in the market price of the outstanding shares of our common stock. If we issue any such additional shares, such issuance will reduce the proportionate ownership and voting power of all current shareholders. Further, such issuance may result in a change of control of our corporation.

Trading of our stock is restricted by the Securities Exchange Commission’s penny stock regulations, which may limit a stockholder’s ability to buy and sell our common stock.

The Securities and Exchange Commission has adopted regulations which generally define “penny stock” to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and “accredited investors”. The term “accredited investor” refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the Securities and Exchange Commission, which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.

FINRA sales practice requirements may also limit a stockholder’s ability to buy and sell our stock.

In addition to the “penny stock” rules described above, the Financial Industry Regulatory Authority (known as “FINRA”) has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Our common stock is illiquid and the price of our common stock may be negatively impacted by factors which are unrelated to our operations.

Although our common stock is currently listed for quotation on the OTC Bulletin Board, there is no market for our common stock. Even when a market is established and trading begins, trading through the OTC Bulletin Board is frequently thin and highly volatile. There is no assurance that a sufficient market will develop in our stock, in which case it could be difficult for shareholders to sell their stock. The market price of our common stock could fluctuate substantially due to a variety of factors, including market perception of our ability to achieve our planned growth, quarterly operating results of our competitors, trading volume in our common stock, changes in general conditions in the economy and the financial markets or other developments affecting our competitors or us. In addition, the stock market is subject to extreme price and volume fluctuations. This volatility has had a significant effect on the market price of securities issued by many companies for reasons unrelated to their operating performance and could have the same effect on our common stock.

We do not intend to pay dividends on any investment in the shares of stock of our company.

We have never paid any cash dividends and currently do not intend to pay any dividends for the foreseeable future. Because we do not intend to declare dividends, any gain on an investment in our company will need to come through an increase in the stock’s price. This may never happen and investors may lose all of their investment in our company.

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

Since the beginning of the three month period ended September 30, 2013, we have not sold any equity securities that were not registered under the Securities Act of 1933 that were not previously reported in an annual report on Form 10-K, in a quarterly report on Form 10-Q or in a current report on Form 8-K.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

Exhibit Number	Description
(2)	Plan of acquisition, reorganization, arrangement, liquidation or succession
2.1	License and Research Funding Agreement dated July 25, 2012 between Ramot at Tel Aviv University Ltd. and Savicell Diagnostic Ltd. (portions of the exhibit has been omitted pursuant to a request for confidential treatment) (incorporated by reference to an exhibit to a current report on Form 8-K filed July 16, 2013)
(3)	Articles of Incorporation and Bylaws
3.1	Articles of Incorporation (incorporated by reference to an exhibit to a registration statement on Form S-1 filed on August 10, 2010)
3.2	Bylaws (incorporated by reference to an exhibit to a registration statement on Form S-1 filed on August 10, 2010)
(10)	Material Contracts
10.1	Consulting Agreement dated November 1, 2011 with 1367826 Ontario Limited and Robbie Manis (incorporated by reference to an exhibit to a current report on Form 8-K filed on November 3, 2011)
10.2	Consulting Agreement dated November 1, 2011 with Kerry Chow (incorporated by reference to an exhibit to a current report on Form 8-K filed on November 3, 2011)
10.3	Loan Terms Agreement dated November 4, 2011 with Peter Hough (incorporated by reference to an exhibit to a current report on Form 8-K filed on November 8, 2011)
10.4	Mineral Property Acquisition Agreement dated November 21, 2011 with Minera Del Pacifico, S.A. (incorporated by reference to an exhibit to a current report on Form 8-K filed November 21, 2011)
10.5	Loan Terms Agreement dated November 24, 2011 with Amir Rachmani (incorporated by reference to an exhibit to a current report on Form 8-K filed November 24, 2011)
10.6	Loan Terms Agreement dated February 13, 2012 with Ori Ackerman (incorporated by reference to an exhibit to a current report on Form 8-K filed February 13, 2012)
10.7	Form of Subscription Agreement for Non-US Subscribers (incorporated by reference to an exhibit to a current report on Form 8-K filed May 24, 2012)
10.8	Form of Subscription Agreement for US Subscribers (incorporated by reference to an exhibit to a current report on Form 8-K filed May 24, 2012)
10.9	Form of Shares for Debt Agreement for Canadian Subscribers (incorporated by reference to an exhibit to a current report on Form 8-K filed July 18, 2012)
10.10	Form of Subscription Agreement for Non-US Subscribers (incorporated by reference to an exhibit to a current report on Form 8-K filed July 18, 2012)
10.11	Warrant Agreement dated July 25, 2012 between Savicell Diagnostic Ltd. and Ramot at Tel Aviv University Ltd. (incorporated by reference to an exhibit to a current report on Form 8-K filed August 19, 2013)
10.12	Employment Agreement with Giora Davidovits dated September 1, 2012 (incorporated by reference to an exhibit to a current report on Form 8-K filed September 19, 2012)
10.13	Form of Conversion and Participation Rights Agreement (incorporated by reference to an exhibit to a current report on Form 8-K filed November 1, 2012)
10.14	Employment Agreement with Eyal Davidovits dated October 30, 2012 (incorporated by reference to an exhibit to a current report on Form 8-K filed November 5, 2012)

Exhibit Number	Description
10.15	Form of Debt Conversion Agreement (incorporated by reference to an exhibit to a current report on Form 8-K filed November 16, 2012)
10.16	Form of Offshore Debt Conversion Agreement (incorporated by reference to an exhibit to a current report on Form 8-K filed November 16, 2012)
10.17	Form of Canadian Debt Conversion Agreement (incorporated by reference to an exhibit to a current report on Form 8-K filed November 16, 2012)
(21)	Subsidiaries
21.1	Savicell Diagnostic Ltd. our approximately 75.88% subsidiary incorporated in Israel on April 23, 2012
(33)	Certification
31.1*	Section 302 of the Sarbanes-Oxley Act of 2002 of Giora Davidovits
32.1*	Section 906 Certifications under Sarbanes-Oxley Act of 2002 of Giora Davidovits
(101)	XBRL
101.INS*	XBRL INSTANCE DOCUMENT
101.SCH*	XBRL TAXONOMY EXTENSION SCHEMA
101.CAL*	XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
101.DEF*	XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
101.LAB*	XBRL TAXONOMY EXTENSION LABEL LINKBASE
101.PRE*	XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

*Filed herewith.

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.

ONLINE DISRUPTIVE TECHNOLOGIES, INC.

By	/s/ Giora Davidovits

	Giora Davidovits
	Chief Executive Officer, Chief Financial Officer,
	President, Secretary, Treasurer and Director
	(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

November 13, 2013

ONLINE DISRUPTIVE TECHNOLOGIES, INC. - FORM 10-Q - November 13, 2013

Attached files

ONLINE DISRUPTIVE TECHNOLOGIES, INC. Reports