BLUE BIOFUELS, INC. 10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter ended March 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-54942 BLUE BIOFUELS, INC. (Exact name of small Business Issuer as specified in its charter) Nevada 45-4944960 (State or other jurisdiction (IRS Employer of incorporation or organization) Identification No.) 3710 Buckeye Street , Suite 120 Palm Beach Gardens , FL 33410 (Address of principal executive offices) (Zip Code) Registrant’s telephone number, including area code: (888) 607-3555 n/a Former name or former address if changed since last report Securities registered pursuant to Section 12(b) of the Act: None. Securities registered pursuant to Section 12(g) of the Exchange Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock par value $0.001 BIOF OTCQB Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒. Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒ Check whether the issuer (1) 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 ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ 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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. Large Accelerated Filer ☐ Accelerated Filer ☐ Non-Accelerated Filer ☒ Emerging Growth Company ☐ Smaller reporting company ☒ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised accounting standards provided to Section 7(a)(2)(B) of the Securities Act. ☐ If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐ Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No State the number of shares outstanding of the registrant’s $ .001 par value common stock as of the close of business on the latest practicable date (April 11, 2025): 309,129,508 . TABLE OF CONTENTS Page PART I—FINANCIAL INFORMATION 3 ITEM 1. Condensed Financial Statements (unaudited) 4 ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 15 ITEM 3. Quantitative and Qualitative Disclosures About Market Risk 20 ITEM 4. Controls and Procedures 20 PART II—OTHER INFORMATION 21 ITEM 1. Legal Proceedings 21 ITEM 1A. Risk Factors 21 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 2 1 ITEM 3. Defaults Upon Senior Securities 22 ITEM 4. Mine Safety Disclosures 22 ITEM 5. Other Information 22 ITEM 6. Exhibits 22 Signatures 23 2 PART I – FINANCIAL INFORMATION TABLE OF CONTENTS Index to Financial Statements Page Condensed Balance Sheets as of March 31, 2025, and December 31, 2024 (unaudited) 4 Condensed Statements of Operations for the Three Months Ended March 31, 2025 and 2024 (unaudited) 5 Condensed Statements of Stockholders’ Deficit for the Three Months Ended March 31, 2025 and 2024 (unaudited) 6 Condensed Statements of Cash Flows for the Three Months Ended March 31, 2025 and 2024 (unaudited) 7 Notes to Condensed Financial Statements (unaudited) 8 3 Blue Biofuels, Inc. Financial Statements UNAUDITED FINANCIAL STATEMENTS OF BLUE BIOFUELS, INC. Blue Biofuels, Inc. CONDENSED BALANCE SHEETS (unaudited) March 31, 2025 December 31, 2024 ASSETS Current Assets Cash and Cash Equivalents $ 7,583 $ 48,797 Prepaid Expenses 32,489 32,489 TOTAL CURRENT ASSETS 40,072 81,286 Other Assets Property and Equipment, net of accumulated depreciation and amortization of $ 391,813 and $ 361,887 at March 31, 2025 and December 31, 2024, respectively 641,988 539,648 Security Deposits 80,276 30,276 Right of Use Assets, net of accumulated amortization 422,208 440,298 Patents and Trademarks 298,079 298,079 TOTAL OTHER ASSETS 1,442,551 1,308,301 TOTAL ASSETS $ 1,482,623 $ 1,389,587 LIABILITIES AND STOCKHOLDERS’ DEFICIT Current liabilities Accounts Payable $ 267,440 $ 227,195 Accounts Payable - Related Party 72,670 72,670 Accounts Payable 72,670 72,670 Deferred Wages and Directors’ Fees - Related party 1,732,731 1,607,870 Right of Use Lease Liability - Current 71,234 68,677 Convertible Notes Payable — Other - 50,000 Interest Payable - Related Party 185,703 185,703 TOTAL CURRENT LIABILITIES 2,329,778 2,212,115 Long term liabilities Right of Use Lease Liability, Long Term 353,786 372,745 Notes Payable — Related Party 1,240,000 1,140,000 Convertible Notes Payable — Related Party 190,000 190,000 Legacy Notes Payable — Related Party 200,630 200,630 Legacy Notes Payable — Other 120,000 120,000 TOTAL LONG TERM LIABILITIES 2,104,416 2,023,375 TOTAL LIABILITIES 4,434,194 4,235,490 COMMITMENTS AND CONTINGENCIES (NOTES 8 AND 9) - STOCKHOLDERS’ DEFICIT Preferred stock; $ 0.001 par value; 10,000,000 shares authorized; zero shares issued and outstanding - - Common stock; $ 0.001 par value; 1,000,000,000 shares authorized; 308,629,508 and 307,960,508 issued and outstanding at March 31, 2025 and December 31, 2024, respectively. 308,630 307,961 Additional paid-in capital 54,239,393 54,101,897 Accumulated deficit ( 57,499,594 ) ( 57,255,761 ) TOTAL STOCKHOLDERS’ DEFICIT $ ( 2,951,571 ) $ ( 2,845,903 ) TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT $ 1,482,623 $ 1,389,587 The accompanying notes to the Condensed Financial Statements are an integral part of these statements. 4 Blue Biofuels, Inc CONDENSED STATEMENTS OF OPERATIONS (unaudited) Three Months Ended March 31 2025 2024 Revenue $ - $ - Operating expense: General and administrative 338,098 295,982 Research and development 350,707 607,635 Total operating expenses 688,805 903,617 Loss from operations: ( 688,805 ) ( 903,617 ) Other (income) expense: Government grant income ( 444,970 ) - Interest expense - related party - 42,092 Other (income) expense ( 2 ) 1,163 Total other (income) expense ( 444,972 ) 43,255 Income (Loss) before provisions for income taxes $ ( 243,833 ) $ ( 946,872 ) Provisions for income taxes - - Net Income (Loss) $ ( 243,833 ) $ ( 946,872 ) Net income (loss) per share - basic and diluted $ ( 0.001 ) $ ( 0.003 ) Weighted average common shares outstanding Basic 308,459,719 302,788,463 Diluted 308,459,719 302,788,463 The accompanying notes to the Condensed Financial Statements are an integral part of these statements. 5 Blue Biofuels, Inc. CONDENSED STATEMENTS OF STOCKHOLDERS’ DEFICIT (Unaudited) Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Capital Deficit Deficit Balance as of December 31, 2023 302,750,963 $ 302,751 $ 51,972,947 $ ( 55,836,780 ) $ ( 3,561,082 ) Issuance of common stock for services 52,500 $ 52 $ 4,148 - $ 4,200 Issuance of 87,500 warrants for services - - 5,494 - 5,494 Issuance of warrants for services - - 5,494 - 5,494 Stock based compensation recognized under the employee, director plan - - 279,248 - 279,248 Net Income (Loss) ( 946,872 ) $ ( 946,872 ) Balance as of March 31, 2024 302,803,463 $ 302,803 $ 52,261,837 $ ( 56,783,652 ) $ ( 4,219,012 ) Balance as of December 31, 2024 307,960,508 $ 307,961 $ 54,101,897 $ ( 57,255,761 ) $ ( 2,845,903 ) Balance 307,960,508 $ 307,961 $ 54,101,897 $ ( 57,255,761 ) $ ( 2,845,903 ) Employee director stock options exercised on a cashless basis 44,000 44 ( 44 ) - - Issuance of common stock and warrants on the conversion of notes 625,000 625 49,375 - 50,000 Stock based compensation recognized under the employee, director plan - - 88,165 - 88,165 Net Income (Loss) ( 243,833 ) ( 243,833 ) Balance as of March 31, 2025 308,629,508 $ 308,630 $ 54,239,393 $ ( 57,499,594 ) $ ( 2,951,571 ) Balance 308,629,508 $ 308,630 $ 54,239,393 $ ( 57,499,594 ) $ ( 2,951,571 ) The accompanying notes to the Condensed Financial Statements are an integral part of these statements. 6 Blue Biofuels, Inc. CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) For the Three Months Ended March 31 2025 2024 Cash flows from operating activities Net Income (Loss) $ ( 243,833 ) $ ( 946,872 ) Reconciliation of net loss to net cash used in operating activities Depreciation and amortization 29,926 29,810 Stock based compensation 88,165 288,942 Changes in operating assets and liabilities Prepaid expenses - 2,999 Accounts payable 12,609 2,484 Deferred wages and directors fees — related party 124,861 325,700 Interest payable - related party - 42,092 Right of use lease 1,688 ( 1,019 ) Net cash provided by (used in) operating activities 13,416 ( 255,864 ) Cash flows from investing activities Purchase of property and equipment ( 104,630 ) - Deposit on land ( 50,000 ) - Patent and trademark costs - ( 20,825 ) Net cash used in investing activities ( 154,630 ) ( 20,825 ) Cash flows from financing activities Proceeds from issuance of convertible note payable - 260,000 Proceeds from the issuance of notes payable — RP 100,000 Net cash provided by financing activities 100,000 260,000 Net increase (decrease) in cash and cash equivalents ( 41,214 ) ( 16,689 ) Cash and cash equivalent at beginning of the period 48,797 41,008 Cash and cash equivalent at end of the period $ 7,583 $ 24,319 Non-cash financing and investing activities Issuance of common stock and warrants on the conversion of notes payable $ 50,000 $ - The accompanying notes to the Condensed Financial Statements are an integral part of these statements. 7 Blue Biofuels, Inc. NOTES TO CONDENSED FINANCIAL STATEMENTS (Unaudited) NOTE 1 – ORGANIZATION Blue Biofuels, Inc., was incorporated in Nevada on March 28, 2012, as Alliance Media Group Holdings, Inc. Since December 2013, Blue Biofuels, Inc. (the “Company”) has been a technology company focused on emerging technologies in renewable energy, biofuels, and lignin. NOTE 2 – GOING CONCERN The accompanying condensed financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate continuation of the Company as a going concern, which assumes the Company will realize its assets and discharge its liabilities in the normal course of business. The Company has not generated any significant revenue since inception and has incurred losses since inception. As of March 31, 2025, the Company has incurred accumulated losses of $ 57,499,594 . The Company expects to incur significant additional losses and liabilities in connection with its start-up and commercialization activities. These factors, among others, raise substantial doubt as to the Company’s ability to continue as a going concern. 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. These financial statements do not include any adjustments related to the recoverability and classifications of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty. There are no assurances that the Company will continue as a going concern. Management believes that the Company’s future success is dependent upon its ability to achieve profitable operations, generate cash from operating activities, and obtain additional financing. There is no assurance that the Company will be able to generate sufficient cash from operations, or sell additional shares of stock or borrow additional funds. The Company’s inability to obtain additional cash could have a material adverse effect on its financial position, results of operations, and its ability to continue in existence. NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The condensed financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The condensed financial statements do not include all disclosures required of annual financial statements and, accordingly, should be read in conjunction with our financial statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. 8 Operating results for the three months ended March 31, 2025, may not be indicative of full year 2025 results. In management’s opinion, the accompanying condensed financial statements contain all adjustments necessary for a fair statement of our financial position as of March 31, 2025, and our results of operations, changes in stockholders’ deficit and cash flows for the three months ended March 31, 2025 and 2024. Net Income (Loss) per Common Share : Basic net earnings per share amounts have been calculated using the weighted-average number of common shares outstanding during each reporting period. Diluted earnings per share has been calculated using the weighted-average number of common shares plus the potentially dilutive effect of securities such as common stock that potentially could be issued upon the conversion of convertible notes or upon the exercise of outstanding options and warrants. The computation of potential common shares has been performed using the treasury stock method. For the three months ended March 31, 2025 and 2024, due to net losses, all potential dilutive securities are antidilutive. Grant Income Government grants income is recognized in earnings on a systematic basis in a manner that mirrors the manner in which the Company recognizes the underlying costs for which the grant is intended to compensate. A grant receivable is recognized for expenses or losses already incurred but for which grant funding has not yet been received. Grant funding received in excess of expenses or losses incurred is recognized as deferred revenue. The Company has adopted the disclosure requirements of Accounting Standards Codification (“ASC”) 832 Government Assistance. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies that may have an impact on the Company’s accounting and reporting. The Company believes that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future either will not have an impact on its accounting or reporting or that such impact will not be material to its financial position, results of operations, and cash flows when implemented. 9 NOTE 4 – PROPERTY AND EQUIPMENT SCHEDULE OF PROPERTY AND EQUIPMENT PROPERTY AND EQUIPMENT Life March 31, 2025 December 31, 2024 Building and Improvements 15 $ 9,370 $ 9,370 Construction and Engineering 10 171,817 45,342 Machinery and Equipment 10 827,193 821,402 Furniture and Fixtures 5 13,596 13,596 Computer Equipment 3 11,825 11,825 Property and Equipment, gross 1,033,801 901,535 Less Accumulated Depreciation $ ( 391,813 ) $ ( 361,887 ) Property and Equipment $ 641,988 $ 539,648 Total depreciation expense was $ 29,926 and $ 29,810 for the three months ended March 31, 2025 and 2024, respectively. NOTE 5 – PATENTS AND TRADEMARKS The Company has been granted one patent on its technology and one continuation patent in the United States and various international jurisdictions, has filed for three others that are pending, and has also applied for international patents on all of its patents. The Company has capitalized the legal and filing fees of $ 298,079 and $ 298,079 as of March 31, 2025 and December 31, 2024, respectively. NOTE 6 – DEBT Notes Payable – Related Party In 2023 and 2024, the Company borrowed a total of $1,140,000 from board member Chris Kneppers.The notes are now payable on the earliest of the date on which the Company (1) uplists to the Nasdaq or NYSE; (2) receives $5 million in equity financing; or (3) begins generating revenue from its first facility. In the first quarter of 2025, the Company borrowed an additional $100,000 from Mr. Kneppers with the same terms. In lieu of interest, the Company will pay Mr. Kneppers 100% of the outstanding loan balance due him contingent upon the financing of the first plant. All interest and loan amounts automatically come due upon a change of control of the Company or if the Company files for bankruptcy under Chapter 11 or Chapter 7. During the quarters ended March 31, 2025 and 2024, the Company recognized $0 and $11,500, respectively, in interest expense on these notes due to Mr. Kneppers. At March 31, 2025, accrued interest payable to Mr. Kneppers is $46,651. Convertible Notes Payable – Related Party In June and November 2023, the Company entered two long-term convertible notes with board member Edmund Burke with principal amounts of $25,000 and $15,000, respectively, to be repaid when the Company receives an equity investment of at least $3 million. The notes may convert into common stock at $0.13/share at the option of the holder for a total of 307,692 shares. Until repayment, the note agreement requires the Company to issue to Mr. Burke 80,000 warrants having a strike price of $0.15 and an expiration of 5 years every twelve months in lieu of interest. During the quarter ended March 31, 2025, and March 31, 2024, no warrants were issued as they are issued each June and November for the prior year. In April 2023, the Company entered a long-term convertible note with board member Edmund Burke, with a principal balance of $150,000, to be repaid when the Company receives an equity investment of at least $1.5 million. The notes may convert into common stock at $0.13/share at the option of the holder for a total of 1,153,846 shares. Until repayment, the note agreement requires the Company to issue to Mr. Burke 100,000 warrants having a strike price of $0.15 and an expiration of 5 years every six months in lieu of interest. During the quarter ended March 31, 2025, and March 31, 2024, no warrants were issued as they are issued each April. When issued, the fair value of these warrants is included in interest expense – related parties on the statement of operations. Convertible Notes Payable – Non-Related Parties In December 2023, the Company issued a convertible note to one individual for $50,000. The note was non-interest bearing and had a term of thirteen months. In January 2025, the note was converted into 625,000 shares of the Company’s common stock and 625,000 warrants with a strike price of $0.10 per share and a five year expiration. A summary of all Notes that remain including those indicated in the Notes above is as follows: SCHEDULE OF NOTES PAYABLE Notes Payable March 31, 2025 December 31, 2024 Current Convertible Notes — Other $ - $ 50,000 Long Term Convertible Notes Payable – Related Party 190,000 190,000 Long-Term Notes Payable – Related Party 1,240,000 1,140,000 Long Term Notes Payable from future revenue — Related Party 200,630 200,630 Long Term Notes Payable from future revenue — Other 120,000 120,000 TOTAL NOTES $ 1,750,630 $ 1,700,630 Of the $1,750,630 payable as of March 31, 2025, none is payable in cash at a specific point in time. $1,430,000 is due only after achieving certain milestones. $320,630 is due out of future revenue with no specific due date. At March 31, 2025, there are $190,000 in convertible notes that, if converted, would convert into 1,461,538 shares. 10 NOTE 7 – STOCKHOLDERS’ EQUITY During the three months ended March 31, 2025 and 2024, the Company issued an aggregate of 0 and 52,500 shares, respectively, of its common stock for services with a fair value based on the trading price of the Company’s stock on the date of issuance of $ 0 and $ 4,200 , respectively. During the three months ended March 31, 2025 in connection with the conversion of debt with a balance of $ 50,000 , the Company issued 625,000 shares of its common stock and 625,000 warrants with an exercise price $ 0.10 and term of five years . See Note 6. During the three months ended March 31, 2025, the Company issued 44,000 shares of its common stock due to the cashless exercise of 100,000 options by one of its directors. Warrants : During the three-month period ended March 31, 2025 and 2024, the Company issued 0 and 87,500 warrants for services with a fair value of $ 0 and $ 5,494 , respectively. A summary of warrant activity for the year ended December 31, 2024 and three months ended March 31, 2025 is as follows: SCHEDULE OF WARRANT ACTIVITY Number of Warrants Weighted Average Exercise Price Balance, December 31, 2023 24,015,976 0.22 Issued in connection with: Common stock units sold for cash 1,970,000 0.15 Services 303,500 0.11 Debt-related interest 180,000 0.15 Debt conversion 3,125,000 0.10 Expired or rescinded ( 3,397,981 ) 0.09 Exchanged for stock options 1,250,000 0.20 Balance, December 31, 2024 27,446,495 $ 0.21 Issued in connection with: Debt conversion 625,000 0.10 Expired or rescinded 0 - Balance, March 31, 2025 28,071,495 0.21 Warrants outstanding at March 31, 2025 have a weighted average exercise price of $ 0.21 and a weighted average remaining term of 3.0 years. 11 Stock Options: During the three-month period ended March 31, 2025 and 2024, the Company recognized $ 88,165 and $ 279,248 of stock based compensation, respectively. Of this amount, $ 33,709 (2024: $ 16,940 ) was classified as general and administrative expense and $ 54,456 (2024: $ 262,308 ) was classified as research and development expenses. A summary of option activity for the year ended December 31, 2024 and three months ended March 31, 2025 is as follows: SCHEDULE OF OPTION ACTIVITY Number of Options Weighted Average Exercise Price Balance, December 31, 2023 61,555,000 0.15 Options granted 29,166,571 0.11 Options expired ( 500,000 ) 0.05 Exchanged for warrant ( 1,250,000 ) 0.20 Balance, December 31, 2024 88,971,571 $ 0.13 Options granted 1,659,090 0.11 Options expired ( 3,158,334 ) 0.18 Options exercised ( 100,000 ) 0.07 Balance, March 31, 2025 87,372,327 0.13 Vested, March 31, 2025 44,259,324 0.13 The weighted average exercise price of outstanding and vested options is $ 0.13 and $ 0.13 , respectively. The weighted average remaining life of outstanding and vested options is 7.0 years and 6.3 years, respectively. At March 31, 2025, outstanding vested options had an intrinsic value of $ 468,668 , and the total intrinsic value of all options is $ 901,962 . At March 31, 2025, remaining compensation to be recognized as future vesting of stock options is approximately $5.1 million of which approximately $0.15 million will vest over the next year and approximately $4.9 million will vest upon the probability of achieving performance milestone criteria. Black Scholes Model Variables: The fair value associated with warrants and options issued or modified during the three months ended March 31, 2025 were valued on the date of issuance or modification. The following ranges of assumptions were used in calculations of the Black-Scholes option pricing models for option and warrant-based stock compensation issued in the quarters ended March 31, 2025 and 2024: SCHEDULE OF BLACK-SCHOLES OPTION PRICING MODELS FOR WARRANT-BASED STOCK COMPENSATION March 31, 2025 March 31, 2024 Exercise price $ 0.11 $ 0.10 Risk-free interest rate 4.54 % 3.93 % - 4.20 % Expected term (in years) 10.0 5.0 to 10.0 Expected share price volatility 109.69 % 89.73 % to 92.01 % Expected dividend yield 0.0 % - 0.0 % 0.0 % - 0.0 % 12 NOTE 8 - COMMITMENTS AND CONTINGENCIES Litigation The Company is subject, from time to time, to litigation, claims and suits arising in the ordinary course of business. The Company is not in any litigation at this time. Leases The Company currently leases office and laboratory space in Palm Beach Gardens, FL, that is classified as operating lease right-of-use (“ROU”) assets and operating lease liabilities in the Company’s condensed balance sheet. During the three month period ended March 31, 2025, the Company renewed the leases when they expired. The new lease has a term of five years and has escalating monthly payments range from $ 9,100 to $ 10,242 . At inception, the lease was classified as an operating lease and the Company recorded a ROU lease asset and liability of $ 452,132 and $ 452,132 , respectively, at a discount rate of 10 %. Rent expense for the three months ending March 31, 2025, and 2024 were $ 57,579 and $ 42,151 , respectively, which is expensed as part of G&A in the statement of operations. At March 31, 2025, minimum lease payments to be paid by the Company are as follows: SCHEDULE OF MINIMUM LEASE PAYMENTS Remainder of 2025 $ 82,450 2026 113,043 2027 116,434 2028 119,928 2029 102,426 Total lease payments 534,281 Less imputed interest ( 109,261 ) Present value of lease liabilities 425,020 Current portion ( 71,234 ) Long term portion $ 353,786 NOTE 9 – RELATED PARTY TRANSACTIONS Related Party transactions with the Company are as follows: 1) Short-term notes payable, convertible notes, and legacy liabilities issued to related parties are described in NOTE 6. 2) A board resolution was passed on February 13, 2020 that pledged the patents and pending patents to secure the back pay claims of Ben Slager, CEO, Anthony Santelli, CFO, and Charles Sills, Director. This was done to ensure the continued involvement of management to build the Company while they receive less than full salaries. 3) During 2024, the board of directors approved an increase in salaries to two officers of the Company retroactive to August 1, 2023, in light of the fact that they are not receiving payments of salaries on a consistent basis. CEO Ben Slager is to receive annual salary of $ 525,000 and CFO Anthony Santelli $ 325,000 . 4) In June 2024, the board of directors approved a partial anti-dilution compensation for CEO Ben Slager, CFO Anthony Santelli, and Director Chris Kneppers to be paid in restricted stock units and options of 4 %, 3 %, and 3 %, respectively, of the equity and warrants granted to investors on the next $ 50 million in equity raised into the Company or its subsidiaries. This is compensation for their deferring salary or lending funds to the Company until such raise(s) is affected. These restricted share units will be issued as the Company raises capital through sale of its common stock. As of March 31, 2025, Ben Slager is to be issued 88,800 RSUs and options with a 15 cent exercise price and expiring on November 14, 2029, and both Anthony Santelli and Chris Kneppers are each to be issued 66,600 RSUs and 66,600 options. None of the RSUs nor options have been issued as of March 31, 2025. 13 5) As of April 1, 2024, the board of directors approved ceasing accruing interest on back pay due to officers and on directors fees. In lieu of interest, the Company will pay an additional $ 25,000 to each director contingent upon the financing of the first plant or the successful uplisting to the NYSE or Nasdaq. Similarly, a performance bonus equal to 100 % of the outstanding back pay balance due to Officers Ben Slager and Anthony Santelli shall be paid contingent upon the financing of the first plant. These amounts automatically come due upon a Change of Control or if the Company files for bankruptcy under Chapter 11 or Chapter 7. 6) As of August 28, 2024, each Director that is not an Officer shall receive 3.5% in cash and 3.5% in warrants for any investor first introduced to the Company by the Director. The warrants shall either be at the same price as any warrants being offered in the raise, or, if there are no warrants in the raise, then at the closing market price on the date in which the funds are received. All warrants will have a 5-year expiration from the date of the investment. No such cash/warrants have been earned to date. NOTE 10 – GRANT INCOME In September 2024, the Company was awarded a Small Business Innovation Research (“SBIR”) grant by the U.S. Department of Energy (DOE) in the amount of $ 1.15 million to be received subject to meeting certain terms and conditions. The purpose of the grant is to support the further development of the Company’s patented CTS process and to bring it to the point of being commercially ready. Accounting for this DOE grant does not fall under Accounting Standard Codification 606, Revenue from Contracts with Customers , as the DOE does not meet the definition of a customer under this standard. During the three month periods ended March 31, 2025, $ 440,970 was recognized as grant income for this grant. The Company anticipates recognizing an additional $ 420,030 on this grant over the next 12 months. NOTE 11 – SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date the financial statements were issued. Based on this evaluation, the Company has identified the following subsequent events: From April 1, 2025 to the date of this filing, the Company issued 500,000 shares and warrants for $ 50,000 to an unrelated party. From April 1, 2025 to the date of this filing, the Company received $ 75,000 from a board member in exchange for a note. 14 ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Forward-Looking Statements This quarterly report contains forward-looking statements and information relating to the Company that are based on the beliefs of its management as well as assumptions made by, and information currently available to, its management. When used in this report, the words “believe,” “anticipate,” “expect,” “estimate,” “intend”, “plan” and similar expressions, as they relate to the Company or its management, are intended to identify forward-looking statements. These statements reflect management’s current view of the Company concerning future events and are subject to certain risks, uncertainties and assumptions, including among many others: a general economic downturn; a downturn in the securities markets; federal or state laws or regulations having an adverse effect on proposed transactions that the Company desires to effect; Securities and Exchange Commission regulations which affect trading in the securities of “penny stocks”; and other risks and uncertainties. Some of those risks and uncertainties include the risk factors set forth in this report and our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Should any of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this report as anticipated, estimated or expected. The accompanying information contained in this financial statement identifies important additional factors that could materially adversely affect actual results and performance. You are urged to carefully consider these factors. All forward-looking statements attributable to the Company are expressly qualified in their entirety by the foregoing cautionary statement. Business Overview Blue Biofuels, Inc., was incorporated in Nevada on March 28, 2012, as Alliance Media Group Holdings, Inc. Since December 2013, Blue Biofuels, Inc. (the “Company”) has been a technology company focused on emerging technologies in renewable energy, biofuels, and lignin. In early 2018, the Company’s chief executive officer (“CEO”) Ben Slager invented a new reactor technology with a higher yield and a continuous throughput in the Cellulose-to-Sugar process, or CTS, and the Company filed a process patent application for this technology. Mr. Slager has since further developed the system with the technical staff of the Company. The CTS patent was awarded in 2021 in the United States (U.S. Patent No. 10,994,255) and has subsequently been granted in Japan, Australia, Russia, and El Salvador. The Company also filed this patent in other major jurisdictions of the world including the European Patent Organization, Brazil, China, and the African Regional Intellectual Property Organization. The patent applications are currently pending in all of these international jurisdictions. In addition to this patent, the Company has received one additional patent in the United States (U.S. Patent No. 11,484,858B2), for which it has also applied in all the above-mentioned jurisdictions. Further, the company has filed for 3 other patents in the United States which are currently pending. Mr. Slager has since further developed the system with the technical staff of the Company. The patented CTS process is a continuous mechanical/chemical dry process for breaking down cellulosic material for conversion into biofuels. CTS can break down any cellulosic material – including grasses and agricultural waste. The CTS mechanical/chemical process allows for exact process control to ensure that all the material passing through it does so on the optimum reaction parameters through which optimal efficiency is achieved. The new technology made it worthwhile to financially restructure the Company through Chapter 11. The Company voluntarily filed for Chapter 11 on October 22, 2018, in the U.S. Bankruptcy Court in the Southern District of Florida. The Company exited Chapter 11 on September 18, 2019, while keeping all classes, including shareholders, unimpaired. The bankruptcy case was closed on October 25, 2019. CTS is environmentally friendly in that it has no toxic waste, and it has a low carbon footprint: the amount of added atmospheric carbon created by burning the biofuels produced by the CTS system was absorbed by the plant-based feedstock while growing and is merely released back into the atmosphere. No extra CO2 is released into the atmosphere when our biofuels are burned. This is to be distinguished from fossil fuels because new CO2 is released when fossil fuels are burned. The Company believes a significant difference between CTS cellulosic ethanol and corn ethanol is the wide range of abundantly available feedstocks that CTS can process compared to just corn as the feedstock. The CTS feedstocks are nonfood and have much lower costs than corn. In addition, while in corn ethanol only the corn kernels are used, CTS uses the whole plant or its waste products, meaning it could obtain much higher yields per acre. In 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 optimized the core process. The Company is now upscaling, testing 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. This process is partially funded by the $1.15 million SBIR Phase 2 Department of Energy grant, which followed up from the SBIR Phase 1 DOE grant that helped fund the finalizing of the proof of concept. In addition, the Company has licensed the Vertimass Process which is a patented one step process that converts 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. 15 Plan of Operation The total process from cellulosic feedstock to SAF consists basically of three steps: 1) Conversion from feedstock to fermentable cellulosic sugars (CTS) 2) Ferment the cellulosic sugars into cellulosic ethanol. 3) Covert the ethanol into SAF and related products. This third step happens with the Vertimass technology which the Company has licensed. In 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 5-10 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, 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. Commencing commercial production will require project financing. Any new biofuels plant that is built would require various government permits. In particular, renewable fuels are subject to rigorous testing and premarket approval requirements by the EPA’s Office of Transportation and Air Quality and regulatory authorities in other countries. In the U.S., various federal, and, in some cases, state statutes and regulations also govern or impact the manufacturing, safety, storage and use of renewable fuels. The process of seeking required approvals and the continuing need for compliance with applicable statutes and regulations requires the expenditure of resources. The Company anticipates raising the necessary capital for this as a part of its project-based financing. The ethanol industry is competitive with over 200 ethanol plants in the United States alone. Currently, the vast majority use corn as feedstock. Their profitability depends highly on the fluctuations between the price of corn and the price of ethanol. Since the Company does not plan to use corn, and plans on having long-term purchase agreements with cellulosic feedstock suppliers, we anticipate that our profitability will be more consistent. Further, cellulosic biofuels yield much higher incentives than non-cellulosic biofuels. The Energy Policy Act of 2005, which included the Renewable Fuel Standard Program enforced by the US Environmental Protection Agency (EPA), mandates a certain amount of renewable fuel be blended into the transportation fuel used by all vehicles in the country. This Program provides monetary incentives to companies that produce renewable transportation fuel, and establishes Renewable Identification Numbers (RINs) or credits for each gallon of renewable transportation fuel produced in the United States, and breaks down those fuels into different D-codes depending on the source of the renewable fuel. D3 is the code for renewable ethanol that comes from cellulosic materials. The EPA’s final D3 RIN volume mandates for cellulosic biofuel include 840 million gallons for 2023, 1.09 billion gallons for 2024, and 1.38 billion gallons for 2025 (the D3 mandate). This mandate has increased every year and is statutorily mandated to increase in the future and become a larger portion of the full renewable fuels mandate, if and when cellulosic biofuels can be produced profitably in larger and larger quantities. The RFS mandate for 2024 called for 21.54 billion gallons of total renewable fuel, whereas for 2025 it’s 22.33 billion gallons with 7.33 billion gallons from advanced biofuels, including cellulosic biofuels, leaving 15 billion gallons for conventional biofuels (corn ethanol). The “blend wall” (or upper limit to the amount of ethanol that can be blended into U.S. gasoline and automobile performance and comply with the Clean Air Act) of limiting ethanol content in gasoline to 10%, limits the total amount of ethanol consumed in the United States. Recent proposals have make 15% blending available year around in some states. The value of the D3 RIN fluctuates, but as of this filing, it is approximately $2.51 per gallon of ethanol. For comparison, the D6 RIN for corn ethanol is $0.96. To profit from these incentives, the Company plans to apply for these RIN credits as it brings its first plant into commercial operation. 16 Section 45Z of the Inflation Reduction Act passed on August 16, 2022, offers a Clean Fuel Production Credit (CFPC) per gallon of transportation fuel produced with a base amount of 20 cents per gallon or up to $1 per gallon for a qualified facility (depending on its carbon index) that was built while paying at least prevailing wages and which met apprenticeship requirements. For sustainable aviation fuel, those figures are 35 cents and $1.75 per gallon respectively. The Company plans to apply for CFPC credits when it begins building its commercial facilities. The CFPC currently does not apply to transportation fuel sold after December 31, 2027. A Low Carbon Fuel Standard Credit (LCFS) is offered by various states (primarily California) for any amount of reduced CO2 in the production lifecycle of transportation fuels as compared to the amount of CO2 emitted in the production lifecycle of fossil fuels. The production lifecycle includes transportation costs to the point of use. California is currently offering around $57 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 determine in which state it could earn the most credits. At commercial scale, management expects to be able to earn substantial renewable fuel credits and produce sustainable ethanol, sustainable aviation fuel, biogasoline, and other sustainable biofuels more profitably than they could be from existing commercial corn ethanol producers. Cellulosic ethanol comes with a much more valuable D3 RIN credit as compared to the D6 RIN allocated to corn ethanol; cellulosic SAF comes with a very valuable D7 RIN, and cellulosic bio-gasoline comes with a valuable D3 RIN. The Company also expects to receive Clean Fuel Production Credits related to section 45Z of the Inflation Reduction Act, and the Company also plans to pursue Low Carbon Fuel Standard Credits. After its first plant is profitable, the Company intends to grow with additional plants in the United States and explore international growth by either licensing the CTS technology or forming joint ventures with foreign domestic partners to build plants. The 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 not generated any material revenues from its business. 17 Capital Formation From January 1, 2025, through the date of filing, the Company issued an aggregate of 44,000 shares of its common stock for the cashless exercise of 100,000 options. From January 1, 2025, through the date of filing, the Company issued an aggregate of 1,125,000 shares and warrants for the conversion of $50,000 in debt and $50,000 in cash. From January 1, 2025, through the date of filing, 6,915,757 options vested. During the three months ended March 31, 2025, the Company recognized additional stock-based compensation of $88,165 in connection with the expensing of unvested options. From January 1, 2025, through the date of filing, 3,158,334 unvested options expired. Going Concern The Company has incurred losses since inception, has a working capital deficiency, and may be unable to raise further capital. As of March 31, 2025, the Company had a working capital deficit of $2,289,706 and had incurred accumulated losses of $57,499,594 since its inception. The Company expects to incur significant additional losses in connection with its continued start-up activities. As a result, there is substantial doubt about 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. Results of Operations Comparison of the three month period ended March 31, 2025 to March 31, 2024 For the three months ended March 31, 2025, the Company recognized $0 in revenue as opposed to $0 in 2024. For the three months ended March 31, 2025, the Company’s general and administrative expenses increased by $42,116 to $338,098 from $295,982 in 2024. This increase is primarily the result of $56,199 in consulting expenses in 2025 versus $20,847 in 2024. Interest expense decreased in the quarter ended March 31, 2025 by $43,255 to $0 from $43,255 in 2024. Research and development (R&D) costs for the quarter ended March 31, 2025, were $350,707 a decrease of $256,928 from $607,635 in 2024. The decrease in R&D expenses is primarily the result of equity-based compensation of $262,308 in 2024 versus $54,456 in 2025. Liquidity and Capital Resources Liquidity As of March 31, 2025, the Company had $7,583 in cash and cash equivalents, and total stockholders’ deficit on March 31, 2025, was $2,951,571. As of December 31, 2024, the Company had $48,797 in cash and cash equivalents, and total stockholders’ deficit at December 31, 2024, was $2,845,903. Total debt, including convertible notes, accounts payable and other notes payable at March 31, 2025, together with interest payable thereon and legacy liabilities, was $4,434,194 an increase of $198,704 from December 31, 2024, where it stood at $4,235,490. This increase is primarily attributable to an increase in deferred wages of $124,861 and a net increase in debt of $50,000. During the three months ended March 31, 2025, the Company’s net cash provided by operating activities was $13,416 compared to net cash used in operating activities of $255,864 in the three months ending March 31, 2024. This is primarily attributed to lower net loss and a smaller change in deferred wages from $325,700 to $124,861 in 2025. During the three months ended March 31, 2025, the Company generated an aggregate of $100,000 through its financing activities versus $260,000 in the three months ended March 31, 2024, which is a decrease of $160,000. This decrease from the prior year can primarily be attributed to net proceeds of $100,000 for the issuance of notes payable in 2025 versus $260,000 in 2024. 18 Capital Resources At this time, the Company has limited liquidity and capital resources. To continue funding its operations, the Company will need to generate revenue or obtain additional financing for current and future operations. The Company anticipates needing additional funds for G&A expenses and will seek project financing for a commercial ethanol to SAF facility in addition to funds needed to complete the commercialization of its CTS system. There is no guarantee that the Company will achieve all of the additional funding that is needed. As of the date of this filing, in 2025 the Company has raised $175,000 through the issuance of notes and $50,000 through the issuance of shares. The Company previously raised $17,160,625 in shares and $2,245,916 through converted notes and $1,430,000 in debt or convertible notes since inception. However, there is no guarantee that the Company will be able to raise any additional capital on terms acceptable to the Company. The inability to obtain this funding either in the near term and/or longer term will materially affect the ability of the Company to implement its business plan of operations and jeopardize the viability of the Company. In that case, the Company may need to reevaluate and revise its operations. Equity As of March 31, 2025, shareholders’ deficit was $2,951,571. There were 308,629,508 shares of common stock issued and outstanding as of March 31, 2025. There were no preferred shares outstanding. The Company has paid no dividends. 19 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item. ITEM 4. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. As required by Rule 13a-15(e) of the Exchange Act, our management has carried out an evaluation, with the participation and under the supervision of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as of March 31, 2025. Based upon, and as of the date of this evaluation, our chief executive officer and chief financial officer determined that our disclosure controls and procedures were effective. Changes in Internal Control over Financial Reporting There has been no change in our internal control over financial reporting during the quarter ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting. 20 PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS The Company is subject, from time to time, to litigation, claims and suits arising in the ordinary course of business. As of the date of filing, there are no material claims or suits whose outcomes could have a material effect on the Company’s financial statements. ITEM 1A. RISK FACTORS. As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item. ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES Below is a list of securities sold by the Company from January 1, 2025, through the date of filing which were not registered under the Securities Act. Entity Date of Investment Title of Security Amount of Securities Sold Consideration Clay Taylor 01/21/25 Common Stock 625,000 Note Conversion Peter Zimeri 02/18/25 Common Stock 44,000 Exercise of Options Anthony Santelli, Sr. 04/04/25 Common Stock 500,000 Purchase @ $0.10 per share The securities issued in the above-mentioned transactions were issued in connection with private placements exempt from the registration requirements of Section 5 of the Securities Act of 1933, as amended, pursuant to the terms of Section 4(a)(2) of that Act and Rules 504 and 506 of Regulation D. 21 ITEM 3. DEFAULTS UPON SENIOR SECURITIES None. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. ITEM 5. OTHER INFORMATION None. ITEM 6. EXHIBITS The exhibits listed below are filed as part of or incorporated by reference in this report. Exhibit No. Identification of Exhibit 3.1 Articles of Incorporation (incorporated by reference to the Company’s S-1 filed May 23, 2012) 3.2 Certificate of Amendment to Articles of Incorporation filed November 19, 2014 (incorporated by reference to the Company’s Form 10-12G/A filed on February 16, 2021) 3.3 Certificate of Amendment to Articles of Incorporation filed June 17, 2016 (incorporated by reference to the Company’s Form 10-12G/A filed on February 16, 2021) 3.4 Certificate of Amendment to Articles of Incorporation filed July 26, 2021 (incorporated by reference to the Company’s 8-K filed on July 30, 2021) 3.5 Bylaws (incorporated by reference to the Company’s Form 10-12G/A filed on February 16, 2021) 10.1 Employment Agreement, dated June 1, 2020, between the Company and Ben Slager (incorporated by reference to the Company’s Form 10-12G/A filed on February 16, 2021) 10.2 Employment Agreement, dated June 1, 2020, between the Company and Anthony Santelli (incorporated by reference to the Company’s Form 10-12G/A filed on February 16, 2021 10.3 2021 Employee, Director Stock Plan (incorporated by reference to definitive 14C filed with the SEC on June 24, 2021) 31.1. Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 31.2 Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1 Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2 Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 101.INS Inline XBRL Instance Document 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) 22 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Blue Biofuels, Inc. (Registrant) By /s/ Benjamin Slager Benjamin Slager Chief Executive Officer, (Principal Executive Officer) Date April 30, 2025 By /s/ Anthony Santelli Anthony Santelli Chief Financial Officer (Principal Financial and Accounting Officer) Date April 30, 2025 23