What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-03-19 compared with 2024-03-26 · 79 added, 80 removed, 142 unchanged (53% of the section changed)

39 unchanged sentences

In 2023, the Company

completed the build-out of a pilot plant based on a modified Komarek machine and is in the process of further testing and optimizing

The Company believes that it can optimize the pre and post processing elements at this pilot scale plant to finalize design

and operational parameters to provide operating cost estimates of a full-scale commercial volume system.

Due to its mechanical nature

and modularity, we anticipate that one plant would have multiple modular CTS systems.

completed the build-out of a pilot plant based on a modified Komarek machine and is in the process of further upscaling and optimizing

the pre and post processing elements at this pilot scale plant to finalize design and operational parameters to provide operating cost

estimates of a full-scale commercial volume system.

Due to its mechanical nature and modularity, we anticipate that one plant would have

multiple modular CTS systems.

addition, the Company has licensed the Vertimass Process to convert ethanol into sustainable aviation fuel (SAF) and other renewable

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As of this date, the Company has generated $194,319 in revenue, however it has not generated any revenues from its core business.

January 1, 2023 through the date of filing, 5,950,148 warrants were exercised for proceeds of $97,251.

January 1, 2023 through the date of filing, no options were exercised.

January 1, 2023, through the date of filing, the Company issued 6,684,998 shares at prices ranging from $0.15 to $0.15 per share for

proceeds of $1,002,772.

January 1, 2023, through the date of filing, the Company issued 312,500 shares for the conversion of debt for proceeds of $25,000.

January 1, 2023 through the date of filing, the Company issued an aggregate of 226,694 shares of its common stock for services valued

January 1, 2023 through the date of filing, the Company issued an aggregate of 856,500 warrants for services.

Using a Black-Scholes asset-pricing

model, these warrants were valued at $88,259.

of Operations

of the year ended December 31, 2024, to December 31, 2023

the year ended December 31, 2024, the Company has a net loss of $1,418,981, as compared to a net loss of $3,055,194 in 2023.

primarily attributed to a gain on extinguishment of debt of $2,417,502.

the year ended December 31, 2024, the Company recognized $0 in revenue and $0 in 2023.

the year ended December 31, 2023, the Company’s general and administrative expenses decreased by $202,170 to $1,339,789 from $1,541,959

This decrease is primarily due to the vesting and expensing of options in 2022 valued at $526,636, as compared to $169,382 non-cash

stock compensation in 2023.

expense increased in the year ended December 31, 2023 by $68,371 to $97,778 from $29,407 in 2022.

the year ended December 31, 2023, the Company received grants valued at $233,5000 versus $13,000 in 2022.

The grant money comes from

the Department of Energy SBIR Phase I grant.

the year ended December 31, 2024, the Company’s general and administrative expenses increased by $386,317 to $1,726,106 from $1,339,789

This increase is primarily due to higher stock-based compensation recognized in 2024 which was $535,395 compared to $169,382

expense decreased in the year ended December 31, 2024 by $33,175 to $64,604 from $97,779 in 2023.

the year ended December 31, 2024, the Company was awarded a grant valued at $1,150,000 , of which $285,000 was recognized as grant

income in 2024,versus $233,500 in 2023.

The grant money in 2024 comes from the Department of Energy SBIR Phase II grant, and in 2023

comes from the Department of Energy SBIR Phase I grant.

and Development

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to research and development expenses were $2,329,413 and $1,849,967, respectively.

The decrease is largely due to the vesting of options

in 2022 valued at $1,038,953, versus $467,646 in 2023.

The increase is largely due to the vesting and expensing

of options in 2024 valued at $1,114,160, versus $467,646 in 2023.

and Capital Resources

of December 31, 2023, the Company had $41,007 in cash and total stockholders’ equity as of December 31, 2023, was negative $3,561,082.

As of December 31, 2022 the Company had $211,901 in cash and total stockholders’ equity at December 31, 2022 was negative $2,356,917.

Total debt, including advances, accounts payable and other notes payable at December 31, 2023, together with interest payable thereon

and contingent liabilities, was $4,591,301, an increase of $1,128,465 from December 31, 2022, where it stood at $3,462,836.

This increase

is primarily attributable to deferred wages of management and board, and notes to related parties of $350,000.

$2,738,132 of the remaining

debt has been renegotiated to be payable out of future revenue or future profits and otherwise does not come due.

$2,417,502 of the $2,738,132

will be discharged if not paid by September 18, 2024.

the fiscal year ended December 31, 2023, the Company’s operating expenses decreased $974,861 to $2,957,415 from $3,932,276 in 2022.

This decrease can primarily be attributed to equity-based compensation of $1,565,589 in 2022 due to the vesting of options.

the fiscal year ended December 31, 2023, the Company’s investing activities used $320,504 in cash.

This can be attributed to $287,829

used to purchase machinery and equipment and $32,675 in patent costs.

These are to be compared to $205,520 cash used in 2022 with $138,170

used to purchase machinery and equipment, and $67,350 in patent costs.

the fiscal year ended December 31, 2023, the Company generated an aggregate of $1,750,023 through its financing activities, which is

an increase of $461,123 from $1,288,900 raised during fiscal year ended December 31, 2022.

This increase from the prior year can be attributed

to $700,000 net proceeds from issuance of convertible notes as compared to zero in 2022, and $1,002,772 raised in private placements

as compared to $1,168,000 in 2022, and $97,251 received from the exercise of warrants as compared to $120,900 in 2022, and a $50,000

debt repayment in 2023 versus $0 in 2022.

of December 31, 2024, the Company had $48,797 in cash and stockholders’ deficit of $2,845,903.As of December 31, 2023, the Company

had $41,008 in cash and stockholders’ deficit of $3,561,082.

At December 31, 2024, total current liabilities is $2,212,115 compared

to $1,503,169 at December 31, 2023.

This increase is primarily attributable to deferred wages of management and directors fees.

liabilities at December 31, 2024 total $2,023,375 as compared to $3,088,132 in 2023.

The decrease is attributable to the discharging

of notes payable with balances of $2,417,502 as of September 18, 2024 in accordance with the Company’s 2019 bankruptcy, offset

by additional borrowings of $930,000.

the fiscal year ended December 31, 2024, the Company’s operating expenses increased $865,964 to $4,056,879 from $3,190,915 in 2023.

This increase can primarily be attributed to stock-based compensation of $1,674,710 in 2024 due to the vesting and expensing of options

versus $728,911 in 2023.

the fiscal year ended December 31, 2024, the Company’s investing activities used $115,791 in cash versus $320,505 in 2023.

decrease can be attributed to $287,828 used to purchase machinery and equipment and $32,677 in patent costs in 2023 versus $71,138 and

$44,653 respectively in 2024.

the fiscal year ended December 31, 2024, the Company generated an aggregate of $1,127,000 through its financing activities which is a

decrease of $623,024 from fiscal year 2023 where it was $1,750,024.

This decrease from the prior year can be attributed to $197,000 net

proceeds raised in private placements as compared to $1,002,773 in 2023, offset by the issuance of $930,000 in convertible notes in 2024

versus $700,000 in 2023.

There was also $97,251 received from the exercise of options and warrants in 2023 as compared to $0 in 2024,

and a $50,000 debt repayment in 2023 versus $0 in 2024.

this time, the Company has limited liquidity and capital resources.

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revenue or obtain additional financing for current and future operations.

The Company anticipates needing around $25 million to pay for

its share of the Vertiblue Fuels joint venture and start commercial production of Sustainable Aviation Fuel.

The Company anticipates

generating revenue from this joint venture 18-24 months from financing.

There is no guarantee that we will achieve all of the additional

funding that is needed.

of the date of filing, the Company has raised $100,000 through the issuance of convertible notes in 2024, $1,800,023 through a private

placement, the exercise of warrants and the issuance of convertible notes in 2023, $1,288,900 in 2022, through the issuance of common

stock and the exercise of warrants and options, in addition to $14,826,952 raised through the end of 2021 through its private placement

offerings, and in addition to capital raised through debt or convertible notes.

However, there is no guarantee that the company will

be able to raise any additional capital on terms acceptable to the Company.

The Company anticipates needing between $15 million and $100

million to pay for its share of the VertiBlue Fuels joint venture and start commercial production of Sustainable Aviation Fuel.

anticipates generating revenue from this joint venture 18-24 months from financing.

There is no guarantee that we will achieve all of

the additional funding that is needed.

of the date of filing, the Company has raised $930,000 through the issuance of convertible notes in 2024, and $197,000 from the

issuance of common stock.

The Company also was awarded a grant for $1,150,000 from the Department of Energy, $285,000 of which was

received in 2024.

The Company raised $1,800,024 through a private placement, the exercise of warrants and options and the issuance

of convertible notes in 2023, in addition to $16,115,852 raised through the end of 2022 through its private placement offerings, and

in addition to capital raised through debt or convertible notes.

However, there is no guarantee that the company will be able to

raise any additional capital on terms acceptable to the Company.

inability to obtain this funding either in the near term and/or longer term will materially affect the ability of the Company to implement

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Company has paid no dividends.

Accounting Policies

of Presentation

accompanying consolidated financial statements of the Company were prepared in accordance with generally accepted accounting principles

GAAP”) and include the assets, liabilities, revenues and expenses of the Company’s majority-owned

subsidiaries over which the Company exercised control, if any, and there are currently none.

of Consolidation

Company’s consolidated financial statements include the accounts of the Company and its then-existing subsidiaries, after elimination

of intercompany accounts and transactions.

Investments in business entities in which the Company lacks control but has the ability to

exercise significant influence over operating and financial policies are accounted for using the equity method.

The Company’s proportionate

share of net income or loss of the entity is recorded in the Consolidated Statements of Earnings.

Accounting Estimates

preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management

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liabilities as of the dates presented and reported amounts of revenues and expenses during the reporting periods presented.

estimates inherent in the preparation of the accompanying Consolidated Financial Statements include estimates of impairment assessment

of identifiable intangible assets and valuation allowance for deferred tax assets.

Estimates are based on past experience and other considerations

reasonable under the circumstances.

estimates inherent in the preparation of the accompanying Financial Statements include estimates of impairment assessment of identifiable

intangible assets, valuation allowance for deferred tax assets, and stock based compensation.

Estimates are based on past experience

and other considerations reasonable under the circumstances.

Actual results may differ from these estimates.

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made under the stock option plan described below, the Company accounts for the payments in accordance with the provisions of ASC Topic

718, “Stock Compensation” (formerly referred to as SFAS No.

Share-based payments to consultants, service providers

and other non-employees are accounted for under in accordance with ASC Topic 718, ASC Topic 505, “Equity Payments to Non-Employees”

or other applicable authoritative guidance.

718, “Stock Compensation”.

We account for all share-based payments and awards under the fair

value-based method.

We account for the granting of stock options and warrants using the fair value method whereby all awards will be

recorded at fair value on the date of the grant.

The fair value of all stock options and warrants is expensed over their vesting period

with a corresponding increase to additional paid-in capital.

The fair value of stock options and warrants is determined using a Black-Scholes

valuation model.

Option pricing models require the input of subjective assumptions including the length of time employees will retain

their vested stock options and warrants before exercising them, expected share price volatility, and interest rate.

The fair value of

share-based awards is based on the valuation of the common stock on the date of grant.

The fair value of time-based awards that are ultimately

expected to vest is recognized as an expense on a straight-line basis over the requisite service period.

The fair value of performance-based

awards is adjusted for the probability of achieving the performance conditions and is recognized on a straight-line basis over the term

of the award agreement.

Changes in the input assumptions for options and warrants can materially affect the fair value estimate and the

Company’s net loss.

of Long-Lived Assets

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Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell.

Company monitors its investment for impairment at least annually and makes appropriate reductions in the carrying value if it determines

that an impairment charge is required based on qualitative and quantitative information.

Company monitors its investment in property, equipment, and patents and trademarks for impairment at least annually and makes appropriate

reductions in the carrying value if it determines that an impairment charge is required based on qualitative and quantitative information.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis