What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2026-03-19 compared with 2025-03-19 · 83 added, 97 removed, 124 unchanged (59% of the section changed)

19 unchanged sentences

estimated or expected.

The accompanying information contained in this registration statement, including, without limitation, the information

set forth under the heading “Management’s Discussion and Analysis and Plan of Operation — Risk Factors” identifies

The accompanying information contained in this 10-K, identifies

important additional factors that could materially adversely affect actual results and performance.

6 unchanged sentences

early 2018, our chief executive officer (“CEO”) Ben Slager invented a new technology system referred to as Cellulose-to-Sugar

or CTS, and the Company filed, and received, two patents for this technology.

The CTS process is a continuous mechanical/chemical dry

or CTS, and, to date, the Company filed, and received, three patents for this technology.

The CTS process is a continuous mechanical/chemical

process for converting cellulose material into sugar and lignin.

Three additional patent applications have been filed and are pending.

CTS system converts plant-based feedstock into one primary product, soluble sugars, which can be further processed into cellulosic ethanol

and other biofuels like jet fuel, and potentially into bio chemicals.

2022, the Company partnered with K.R.

Komarek to build its CTS machines going forward.

Komarek is an industry leading manufacturing company

that builds briquetting machines and compaction/granulation systems with throughput capacities up to 50 tons per hour.

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 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.

and other biofuels like jet fuel, bio-gasoline, and potentially into bio chemicals.

2025, the Company finalized the upscaling, testing, and optimizing of the pilot plant and is in the process of finalizing design and

operational parameters for cost estimates of a full-scale commercial volume system.

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

biofuels including bio-gasoline.

The license agreement with Vertimass is the subject to a confidentiality agreement between the parties.

total process from cellulosic feedstock to SAF consists basically of three steps:

4 unchanged sentences

January 2024, the Company formed a 50-50 joint venture partnership with Vertimass called VertiBlue Fuels, LLC, that has the mission to

build an ethanol-to-SAF facility in Florida with the initial goal to produce around 10 million gallons of Sustainable Aviation Fuel (SAF)

and related products, and then expand SAF and related product production to approximately 70 million gallon per year.

VertiBlue Fuels

plans to initially convert sugarcane ethanol, and then, when the Company’s CTS technology is fully commercialized, to build commercial

CTS and ethanol facilities on the front-end to produce cellulosic SAF and generate the large D7 RIN and other government credits.

commercial production will require project financing.

build an ethanol-to-SAF facility in Florida with the initial goal to produce around 10-25 million gallons of Sustainable Aviation Fuel

(SAF), and then expand SAF production to approximately 70 million gallon per year.

VertiBlue Fuels plans to initially convert sugarcane

ethanol, and then, as soon as the Company’s first CTS technology factory is finalized, switch to cellulosic ethanol.

to build commercial CTS and ethanol facilities on the front-end of ethanol-to-SAF facilities to produce cellulosic SAF and generate the

large D7 RIN and other government credits.

Commencing commercial production will require project financing.

Energy Policy Act of 2005, which included the Renewable Fuel Standard Program enforced by the US Environmental Protection Agency (“EPA”),

19 unchanged sentences

California is currently offering around $71 per metric ton of CO2 reduction.

When it is closer to commercial production, the Company plans to analyze the cost effectiveness of applying for these LCFS credits to

When it is closer to commercial production, the Company plans to analyse the cost effectiveness of applying for these LCFS credits to

determine in which state it could earn the most credits.

9 unchanged sentences

Company believes that its management and consultants have significant experience in the development of technologies from concept to commercialization.

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

As of this date, the Company has generated $194,319 in revenue not including government grants, however it has not generated any revenues

from its core business.

of Operations

1 unchanged sentence

the year ended December 31, 2025, the Company has a net loss of $2,874,601 as compared to a net loss of $1,418,981 in 2024.

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

primarily attributed to a gain on extinguishment of debt of $2,417,502 in 2024.

the year ended December 31, 2025, the Company recognized $0 in revenue and $0 in 2024.

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.

the year ended December 31, 2025, the Company’s general and administrative expenses decreased by $316,313 to $1,409,793 from $1,726,106

This decrease is primarily due to higher professional fees and stock-based compensation in 2024.

During the fiscal year ended December 31, 2025, the Company’s

operating expenses decreased $341,746 to $3,715,133 from $4,056,879 in 2024.

This decrease can primarily be attributed to stock-based

compensation of $1,674,710 in 2024 due to the vesting and expensing of options versus $956,611 in 2025.

Interest expense- related party decreased in the year ended December

31, 2025 by $30,270 from $54,747 in 2024 to $24,477 in 2025.

the year ended December 31, 2024, the Company was awarded a grant valued at $1,150,000, of which $865,000 was recognized as grant income

in 2025 versus $285,000 in 2024.

The grant money in both years comes from the Department of Energy SBIR Phase II grant.

and Development

2 unchanged sentences

to research and development expenses were $2,305,340 and $2,329,413, respectively.

The increase is largely due to the vesting and expensing

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

The decrease is largely due to the vesting and expensing

of options in 2025 valued at $606,837, versus $1,114,160 in 2024 offset by bonuses of $514,265 in 2025 versus $4,500 in 2024.

and Capital Resources

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.

of December 31, 2025, the Company had $65,200 in cash and stockholders’ deficit of $3,706,083 versus $48,797 and $2,845,903 in

Total current liabilities is $2,984,402 compared to $2,212,115 at December 31, 2024.

This increase is primarily attributable to

deferred wages and bonuses of management and deferred directors fees.

Long-term liabilities at December 31, 2025 total $2,129,060 as

compared to $2,023,375 in 2024.

The increase is attributable to $185,000 additional notes payable to related parties.

the fiscal year ended December 31, 2025, the Company’s investing activities used $137,345 in cash versus $115,791 in 2024.

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.

increase can be attributed to $50,000 deposit on land and $68,898 used to purchase machinery and equipment in 2025 versus $71,138 in

2024, as well as $18,447 spent on patents in 2025 versus $44,653 in 2024.

the fiscal year ended December 31, 2025, the Company generated an aggregate of $998,750 through its financing activities versus $1,127,000

in fiscal year 2024, which is a decrease of $128,250.

This decrease from the prior year can be attributed to $185,000 net proceeds raised

in convertible notes versus $930,000 offset by $745,000 raised in private placements as compared to $197,000 in 2024.

There was also

$68,750 received from the exercise of options and warrants in 2025 as compared to $0 in 2024.

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

1 unchanged sentence

revenue or obtain additional financing for current and future operations.

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.

The Company anticipates needing around $90 million to pay for

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

The Company anticipates

raising the majority of this through project financing, and generating revenue from this joint venture 18-24 months from financing.

is no guarantee that we will achieve all of the additional funding that is needed.

of the date of filing, the Company has raised $185,000 through the issuance of convertible notes in 2025, $68,750 from the exercise

of warrants, and $745,000 from the issuance of common stock, in addition to $272,000 raised in 2026 thus far.

The Company also was awarded a

grant for $1,150,000 from the Department of Energy, $865,000 of which was received in 2025 and $285,000 of which was received in

The Company raised $1,127,000 through a private placement and the issuance of convertible notes in 2024, in addition to

$16,963,625 raised through the end of 2023 through its private placement offerings, and in addition to $2,245,916 in capital raised

through notes that have been converted, in addition to other notes currently on the books.

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

4 unchanged sentences

At December 31, 2025, the Company had a working

capital deficit of $2,130,829 and had incurred accumulated losses of $57,255,761 since its inception.

The Company expects to incur significant

additional losses in connection with its continued start-up activities.

As disclosed in Note 2 to the financial statements, there is

substantial doubt as to the Company’s ability to continue as a going concern based upon recurring operating losses and its need

to obtain additional financing to sustain operations.

The Company’s ability to continue as a going concern is dependent upon its

ability to obtain the necessary financing to meet its obligations and repay its liabilities when they become due and to generate sufficient

revenues from its operations to pay its operating expenses.

capital deficit of $2,907,651 and had incurred accumulated losses of $60,130,362 since

its inception.

The Company expects to incur significant additional losses in connection with its start-up and commercialization activities.

As disclosed in Note 2 to the financial statements, there is substantial doubt as to the Company’s ability to continue as a going

concern based upon recurring operating losses and its need to obtain additional financing to sustain operations.

The Company’s ability

to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and repay its liabilities

when they become due and to generate sufficient revenues from its operations to pay its operating expenses.

of December 31, 2025, shareholders’ equity was negative $3,706,083.

18 unchanged sentences

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.

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

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.

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

14 unchanged sentences

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