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

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~March~~ 31September 30, 2024

Commission File Number: 000-53239

Cavitation Technologies, Inc.
(Exact name of Registrant as Specified in its Charter)

Nevada	20-4907818
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)

10019 CANOGA AVENUE, CHATSWORTH, CALIFORNIA 91311
(Address, including Zip Code, of Principal Executive Offices)

(818) 718-0905
(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered

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 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 (§ 232.405 of this chapter) 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 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	☒	Small reporting company	☒
		Emerging growth 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 financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

As of ~~May~~November 1014, 2024 the issuer had 284,289,740 shares of of common stock outstanding.

TABLE OF CONTENTS

		Page
PART I.	FINANCIAL INFORMATION	3
Item 1.	Condensed Consolidated Financial Statements (unaudited)	3
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Operations	4
	Condensed Consolidated Statement of Stockholders' Deficit	5
	Condensed Consolidated Statements of Cash Flows	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	1416
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	1921
Item 4.	Controls and Procedures	1921
PART II	OTHER INFORMATION	2022
Item 1.	Legal Proceedings	2022
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2022
Item 3.	Defaults Upon Senior Securities	2022
Item 4.	Mine Safety Disclosure	2022
Item 5.	Other Information	2022
Item 6.	Exhibits	2123
Signatures		2224
Certifications

PART I - FINANCIAL INFORMATION

~~ITEM~~Item 1. Condensed Consolidated Financial Statements.

CAVITATION TECHNOLOGIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31,			June 30,
	September 30, 2024			June 30, 2024
	2024			2023
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	~~183~~2,000		$	18179,000
Accounts receivable		19,000			–
Prepaid expenses		40,000			16,000
Prepaid expenses		2,000			–
Total current assets		42,000			195,000
Total current assets		204,000			18,000
Property and equipment, net		–			1,000
Equity method investment		1,000			1,000
Operating lease right of use asset, net		60,000			113,000
Operating lease right-of-use asset		24,000			42,000
Other assets		10,000			10,000
Total assets	$	~~275~~77,000		$	~~143~~248,000
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable and accrued expenses	$	~~125~~187,000		$	~~120~~129,000
Accrued payroll and payroll taxes due to officers		408,000			280,000
Accrued payroll and payroll taxes – related parties		433,000			414,000
Note payable		59,000			59,000
Operating lease liability, current portion		6527,000			6846,000
Advances from distributor		382,000			391,000
Total current liabilities		656,000			598,000
Total current liabilities		985,000			864,000
Note payable, non-current		128,000			130,000
Note payable, non-current		145,000			145,000
Total liabilities		784,000			728,000
Operating lease liability, non-current portion		–			53,000
Total liabilities		1,130,000			1,062,000
Commitments and contingencies		–			–
Stockholders' deficit:
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding as of March 31, 2024 and June 30, 2023, respectively		–			–
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding as of September 30, 2024 and June 30, 2024		–			–
Common stock, $0.001 par value, 1,000,000,000 shares authorized, 284,289,740 shares issued and outstanding as of March 31, 2024 and June 30, 2023		284,000			284,000
Common stock, $0.001 par value, 1,000,000,000 shares authorized, 284,289,740 shares issued and outstanding as of September 30, 2024 and June 30, 2024		284,000			284,000
Additional paid-in capital		26,083,000			26,083,000
Accumulated deficit		(27,~~222~~074,000	)		(2726,~~286~~847,000	)
Total stockholders' deficit		(~~855~~707,000	)		(~~919~~480,000	)
Total liabilities and stockholders' deficit	$	~~275~~77,000		$	~~143~~248,000

See accompanying notes to the condensed consolidated financial statements

CAVITATION TECHNOLOGIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

AS OF ~~MARCH~~SEPTEMBER 3130, 2024 AND 2023

	For the Three Months Ended						~~For the Nine Months Ended~~
	March 31,						March 31,
	September 30,
	2024			2023			~~2024~~			~~2023~~
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Operating expenses:
Revenue	$	519,000		$	58,000		$	711,000		$	361,000
General and administrative expenses	$	218,000		$	214,000
Revenue from joint venture		–			3,000			–			20,000
Research and development expenses		8,000			36,000
Total revenue		519,000			61,000			711,000			381,000
Loss from operations		(226,000	)		(250,000	)
Cost of revenue		(7,000	)		(11,000	)		(41,000	)		(73,000	)
Other Expense
Gross profit		512,000			50,000			670,000			308,000
Interest expense		(1,000	)		(1,000	)
General and administrative expenses		170,000			273,000			556,000			872,000
Net loss	$	(227,000	)	$	(251,000	)
Research and development expenses		9,000			–			45,000			–
Net loss per share
Total operating expenses		179,000			273,000			601,000			872,000
Basic and diluted	$	(0.00	)	$	(0.00	)
Income (loss) from operations		333,000			(223,000	)		69,000			(564,000	)
Weighted average shares outstanding,
Other expense
Basic and diluted		284,289,740			284,289,740
Loss from equity method investment		–			(14,000	)		–			(43,000	)
Interest expense		(2,000	)		(1,000	)		(5,000	)		(3,000	)
Income (loss) before income taxes		331,000			(238,000	)		64,000			(610,000	)
Income taxes		–			–			–			–
Net income (loss)	$	331,000		$	(238,000	)	$	64,000		$	(610,000	)
Net income (loss) per share,
Basic and diluted	$	0.00		$	(0.00	)	$	0.00		$	(0.00	)
Weighted average shares outstanding,
Basic and diluted		284,289,740			277,809,942			284,289,740			277,063,795

See accompanying notes to the condensed consolidated financial statements

CAVITATION TECHNOLOGIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN IN STOCKHOLDERS' DEFICIT (Unaudited) AS OF ~~MARCH~~SEPTEMBER 3130, 2024 AND 2023

	Three Months Ended March 31, 2024 (unaudited)
	Three Months Ended September 30, 2024 (unaudited)
	Common Stock				Additional Paid-in		Accumulated
	Shares		Amount		Capital		Deficit			Total
Balance at December 31, 2023		284,289,740	$	284,000	$	26,083,000	$	(27,553,000	)	$	(1,186,000	)
Balance at June 30, 2024		284,289,740	$	284,000	$	26,083,000	$	(26,847,000	)	$	(480,000	)
Net income		–		–		–		331,000			331,000
Net loss		–		–		–		(227,000	)		(227,000	)
Balance at March 31, 2024		284,289,740	$	284,000	$	26,083,000	$	(27,222,000	)	$	(855,000	)
Balance at September 30, 2024		284,289,740	$	284,000	$	26,083,000	$	(27,074,000	)	$	(707,000	)

	Nine Months Ended March 31, 2024 (unaudited)
	Three Months Ended September 30, 2023 (unaudited)
	Common Stock				Additional Paid-in		Accumulated
	Shares		Amount		Capital		Deficit			Total
Balance at June 30, 2023		284,289,740	$	284,000	$	26,083,000	$	(27,286,000	)	$	(919,000	)
Net income		–		–		–		64,000			64,000
Net loss		–		–		–		(251,000	)		(251,000	)
Balance at March 31, 2024		284,289,740	$	284,000	$	26,083,000	$	(27,222,000	)	$	(855,000	)
Balance at September 30, 2023		284,289,740	$	284,000	$	26,083,000	$	(27,537,000	)	$	(1,170,000	)

	Three Months Ended March 31, 2023 (unaudited)
	Common Stock				Additional Paid-in		Accumulated
	Shares		Amount		Capital		Deficit			Total
Balance at December 31, 2022		276,698,831	$	277,000	$	26,005,000	$	(25,618,000	)	$	664,000
Fair value of common stock issued for services		2,000,000		2,000		38,000		–			40,000
Net loss		–		–		–		(238,000	)		(238,000	)
Balance at March 31, 2023		278,698,831	$	279,000	$	26,043,000	$	(25,856,000	)	$	466,000

See accompanying notes to the condensed consolidated financial statements

	Nine Months Ended March 31, 2023 (unaudited)
	Common Stock				Additional Paid-in		Accumulated
	Shares		Amount		Capital		Deficit			Total
Balance at June 30, 2022		276,698,831	$	277,000	$	26,005,000	$	(25,246,000	)	$	1,036,000
Fair value of common stock issued for services		2,000,000		2,000		38,000		–			40,000
Net loss		–		–		–		(610,000	)		(610,000	)
Balance at March 31, 2023		278,698,831	$	279,000	$	26,043,000	$	(25,856,000	)	$	466,000

~~See~~CAVITATION ~~accompanying~~TECHNOLOGIES, ~~notes to the condensed consolidated financial statements~~INC.

5CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

CAVITATION TECHNOLOGIES, INC.


	Three Months Ended September 30,
	2024			2023

Operating activities:
Net loss	$	(227,000	)	$	(251,000	)
Adjustments to reconcile net loss to net cash (used in) generated by operating activities:
Effect of changes in operating assets and liabilities
Prepaid expenses		(24,000	)		–
Operating lease right of use asset		18,000			18,000
Accounts payable and accrued expenses		58,000			24,000
Accrued payroll and payroll taxes – related parties		19,000			46,000
Advances from distributor, net		–			304,000
Operating lease liability		(19,000	)		(19,000	)
Net cash (used in) generated by operating activities		(175,000	)		122,000

Financing activities:
Repayment of note payable		(2,000	)		–
Cash generated by financing activities		(2,000	)		–

Net (decrease) increase in cash and cash equivalents		(177,000	)		122,000

Cash and cash equivalents, beginning of period		179,000			18,000
Cash and cash equivalents, end of period	$	2,000		$	140,000

Supplemental disclosures of cash flow information:
Cash paid for interest	$	1,000		$	2,000
Cash paid for income taxes	$	–		$	–

~~CONDENSED~~See ~~CONSOLIDATED~~accompanying ~~STATEMENTS~~notes OFto ~~CASH~~the ~~FLOWS~~condensed consolidated ~~(Unaudited)~~financial statements

	Nine Months Ended March 31,
	2024			2023
Operating activities:
Net income (loss)	$	64,000		$	(610,000	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		1,000			1,000
Stock based compensation		–			40,000
Loss from equity method of investment		–			43,000
Effect of changes in:
Accounts receivable		(19,000	)		1,000
Operating lease right of use asset		53,000			50,000
Accounts payable and accrued expenses		133,000			(6,000	)
Advances from distributor, net		(9,000	)		363,000
Operating lease liability		(56,000	)		(51,000	)
Prepaid expenses		(2,000	)		38,000
Net cash generated by (used in) operating activities		165,000			(131,000	)
Net increase (decrease) in cash and cash equivalents		165,000			(131,000	)
Cash and cash equivalents, beginning of period		18,000			441,000
Cash and cash equivalents, end of period	$	183,000		$	310,000
Supplemental disclosures of cash flow information:
Cash paid for interest	$	5,000		$	–
Cash paid for income taxes	$	–		$	–

~~See~~CAVITATION ~~accompanying~~TECHNOLOGIES, ~~notes to the condensed consolidated financial statements~~INC.

6NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Three months ended September 30, 2024 and 2023

~~CAVITATION~~Note ~~TECHNOLOGIES,~~1 ~~INC.~~– Organization and Summary of Significant Accounting Policies

~~NOTES~~Cavitation TOTechnologies, ~~CONDENSED~~Inc. ~~CONSOLIDATED~~(“the ~~FINANCIAL STATEMENTS~~Company,” ~~(UNAUDITED~~“CTi,” “we,” “us,” and “our”) is a Nevada corporation originally incorporated in January ~~Nine~~2007 ~~months~~under ~~ended~~the ~~March~~name 31Bio Energy, ~~2024~~Inc. The Company has developed, patented, and ~~2023~~commercialized proprietary technology used in our Nano Reactor® and LPN™ liquid processing applications.

~~Note~~Going ~~1 - Organization and Summary of Significant Accounting Policies~~Concern

~~Cavitation~~The ~~Technologies~~accompanying consolidated financial statements have been prepared on a going concern basis, ~~Inc~~which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. ~~(referred~~As toreflected ~~herein,~~in the accompanying unaudited condensed consolidated ~~unless~~financial ~~otherwise~~statements, ~~indicated~~during the three months ended September 30, as2024, “the Company recorded a net loss of $227,”000 and ~~“CTi~~used cash in operations of $175,”000. In ~~“we~~addition,” ~~“us~~as of September 30,” 2024, the Company had a stockholders’ deficit of $707,000, a working capital deficiency of $614,000 and ~~“our”)~~accumulated deficit of $27,074,000. isIn aaddition, ~~Nevada~~the ~~corporation~~Company’s ~~originally~~independent ~~incorporated~~registered ~~under~~public accounting firm, in its report on the ~~name~~Company’s ~~Bio~~June ~~Energy~~30, ~~Inc.~~2024, financial ~~CTi~~statements, ~~has~~raised ~~developed~~substantial doubt about the Company’s ability to continue as a going concern. These factors, among ~~patented~~others, ~~and~~raise ~~commercialized~~substantial ~~proprietary~~doubt about the Company’s ability to continue as a going concern within one year of the date ~~technology~~that the financial statements are issued. The accompanying consolidated financial statements do not include any adjustments that may result befrom ~~used~~an ininability ~~liquid~~of ~~processing~~the ~~applications~~Company to continue as a going concern.

~~Basis~~As of ~~Presentation~~September 30, 2024, the Company has cash in the amount of $2,000. Subsequent to September 30, 2024, the Company received cash of $880,000 pursuant to a patent assignment agreement (see Note 9). The Company’s ability to continue as a going concern is dependent upon its ability to continue to implement its business plan. Currently, management’s plan is to increase revenues by continuing to license its technology globally. While the Company believes in the viability of its strategy to increase revenues, there can be no assurances to that effect. The Company believes it has enough cash to sustain operations through March 31, 2025.

The ~~accompanying~~Company ~~condensed~~may ~~consolidated~~also ~~financial statements~~attempt ~~have~~to ~~been~~raise ~~prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United~~additional ~~States~~debt ~~of America (“U.S.”)~~ and/or ~~with~~equity ~~instructions~~financing to ~~Form~~fund ~~10-Q~~operations ~~pursuant~~and to ~~the~~provide ~~rules~~additional ~~and~~working ~~regulations~~capital. ofThere ~~Securities~~is ~~and~~no ~~Exchange Act~~assurance ofthat ~~1934,~~such ~~as amended (the “Exchange Act”) and Article 8-03 of Regulation S-X under the Exchange Act. Accordingly, these~~financing ~~condensed~~will ~~consolidated~~be ~~financial~~available ~~statements~~in ~~do not include all of~~ the ~~information~~future ~~and~~or ~~footnotes~~obtained ~~required~~in bysufficient ~~GAAP~~amounts ~~for complete financial statements. In the opinion of management, we have included all adjustments considered~~ necessary ~~(consisting~~to ofmeet ~~normal recurring adjustments) for a fair presentation. Operating results for~~ the ~~three~~Company’s ~~and nine months ended March 31~~needs, ~~2024~~that ~~are not indicative of~~ the ~~results~~Company ~~that may~~will be ~~expected~~able ~~for~~to ~~the~~achieve ~~fiscal~~profitable ~~year~~operations ~~ending~~or ~~June~~that ~~30, 2024. You should read these unaudited condensed consolidated financial statements in conjunction with~~ the ~~audited financial statements and the notes thereto included in the~~ Company's ~~annual~~will ~~report~~be onable ~~Form~~to ~~10-K~~meet ~~for~~its ~~the~~future ~~year~~contractual ~~ended June 30, 2023 filed on October 3, 2023~~obligations. ~~The~~Should ~~condensed~~management fail ~~consolidated~~to ~~balance~~obtain ~~sheet~~such ~~as of June 30~~financing, ~~2023 has been derived from~~ the ~~audited~~Company ~~financial statements~~may ~~included~~curtail inits ~~the Form 10-K for that year~~operations.

~~Going~~Principles ~~Concern~~of Consolidation

The ~~accompanying~~ consolidated financial statements ~~have~~ ~~been~~include ~~prepared on a going concern basis, which contemplates~~ the ~~realization of assets and the settlement of liabilities and commitments~~ inaccounts ~~the normal course~~ of ~~business.~~Cavitation ~~As reflected in accompanying consolidated financial statements~~Technologies, ~~as of March 31, 2024, the Company had a working capital deficit of $781,000 and a stockholder’s deficit of $855,000~~Inc. ~~Furthermore, the Company has not been generating sufficient revenues to fund operations~~ and ~~has been dependent on certain of~~ its ~~funding~~wholly ~~and~~owned ~~sales~~subsidiary ~~from~~Hydrodynamic aTechnology, ~~technology and marketing agreement with its distributor~~Inc. ~~These~~Intercompany ~~conditions~~transactions ~~raises substantial doubt about the Company’s ability to continue as a going concern. In addition,~~and ~~the~~balances ~~Company’s~~have ~~independent~~been ~~registered~~eliminated ~~public accounting firm,~~ in ~~its report on the Company’s June 30, 2023, financial statements, raised substantial doubt about the Company’s ability to continue as a going concern~~consolidation. ~~The accompanying consolidated financial statements do not include any adjustments that may result from an inability of the Company to continue as a going concern.~~

AsUse of March 31, 2024, the Company has cash in the amount of $183,000. The Company’s ability to continue as a going concern is dependent upon its ability to continue to implement its business plan. Currently, management’s plan is to increase revenues by continuing to license its technology globally. While the Company believes in the viability of its strategy to increase revenues, there can be no assurances to that effect. The Company believes it has access to enough cash resources to sustain operations through June 30, 2024.Estimates

The ~~Company~~preparation ~~may~~of ~~also~~the ~~attempt~~consolidated tofinancial statements ~~raise~~in ~~additional debt~~conformity ~~and/or~~with ~~equity~~accounting ~~financing~~principles generally accepted in the U.S. requires management to ~~fund~~make ~~operations~~estimates and toassumptions that ~~provide~~affect ~~additional~~the ~~working~~reported ~~capital.~~amounts ~~There~~of isassets noand ~~assurance~~liabilities, ~~that~~disclosure ~~such~~of ~~financing~~contingent ~~will be~~assets ~~available~~and inliabilities at the ~~future~~financial orstatement date, ~~obtained~~and inreported ~~sufficient~~ amounts ~~necessary~~of torevenue ~~meet~~and expenses during the ~~Company’s~~reporting ~~needs,~~period. ~~that~~Significant ~~the~~estimates ~~Company~~include ~~will~~estimates befor ~~able~~reserves for tovaluation ~~achieve~~of ~~profitable~~our ~~operations~~equity ormethod ~~that~~investments, ~~the~~assumptions ~~Company~~used ~~will~~in bevaluing ~~able~~our tostock ~~meet~~options, ~~its~~stock ~~future~~warrants ~~contractual~~and ~~obligations.~~common ~~Should~~stock ~~management~~issued ~~fail to~~for ~~obtain~~services ~~such~~and ~~financing~~valuation allowance for our deferred tax asset, ~~the~~among ~~Company~~other ~~may~~items. ~~curtail~~Actual ~~its~~results ~~operations~~could differ from these estimates.

~~Use of Estimates~~7

~~The~~Advances preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the financial statement date and reported amounts of revenue and expenses during the reporting period. Significant estimates are used in impairment analysis for fixed assets, accrual of potential liabilities, deferred tax assets and valuing our stock options, warrants, and common stock issued for services, among other items. Actual results could differ from ~~these estimates.~~Distributor

7Advances from distributor are contract liabilities and represent consideration received from Desmet, customer and distributor, under revenue contracts for which the Company has not yet delivered or completed its performance obligation to the customer. Contract liabilities are recognized over the contract period.

Revenue Recognition

The Company follows the guidance of Financial ~~Accounting~~ Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with ~~Customers~~ Customers (“ASC 606”). ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. Revenue from sale of our Nano Reactors is recognized when products are shipped from our manufacturing facilities as this is our sole performance obligation under these contracts and we have no continuing obligation to the customer. ~~In addition, the Company also recognizes revenues from usage fees of certain reactors. Usage fees are recognized based on actual usage by the customer.~~

~~Equity~~For ~~Method~~the ~~Investment~~license fee revenue, revenue is recognized when the Company satisfies the performance obligation based on the related license agreement and collectability is certain.

~~The~~In ~~Company~~addition, ~~accounts for investments in entities in which~~ the Company ~~has~~also ~~significant~~recognizes ~~influence over the entity’s financial and operating policies, but does not control, using the~~revenues ~~equity~~from ~~method~~usage offees ~~accounting. The equity method investments are initially recorded at cost, and subsequently increased for capital contributions and allocations~~ of ~~net~~certain ~~income, and decreased for capital distributions and allocations of net loss~~reactors. ~~Equity~~Usage infees ~~net income (loss) from the equity method investment is allocated based on the Company’s economic interest. Equity method investments~~ are ~~reviewed~~recognized for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If it is determined that a loss in value of the equity method investment is other than temporary, an impairment loss is measured based on ~~the~~actual ~~excess~~usage ofby the ~~carrying~~customer ~~amount of an investment over its estimated fair value. Impairment analyses are based on current plans, intended holding periods,~~ and ~~available information~~collectability ~~at the time the analysis~~ is ~~prepared~~certain. ~~As of March 31, 2024 and June 30, 2023, the carrying value of its equity method investments was $1,000 for both periods presented.~~

~~Net~~Cash ~~Income~~and ~~(Loss)~~Cash ~~Per Share~~Equivalents

The Company’s ~~computation~~considers ofhighly ~~net~~liquid ~~income~~investments ~~(loss)~~with ~~per~~original ~~share~~maturities ~~(“EPS”)~~of ~~includes~~three ~~basic~~months ~~and~~or ~~diluted~~less ~~EPS. Basic EPS is measured as the income available~~ to ~~common~~be ~~stockholders divided~~cash ~~by the weighted average common shares outstanding for the period~~equivalents. ~~Diluted~~At ~~income~~September ~~per~~30, ~~share~~2024 ~~reflects~~and ~~the~~June ~~potential dilution~~30, ~~using the treasury stock method~~2024, ~~that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in~~ the ~~issuance of common stock that then shared in the income of the~~ Company ~~as if they~~ had ~~been converted at the beginning~~ no cash ~~of the periods presented, or issuance date, if later~~equivalents. In computing diluted income per share, the treasury stock method assumes that outstanding options and warrants were exercised and the proceeds are used to purchase common stock at the average market price during the period. Options and warrants may have a dilutive effect under the treasury stock method only when the average market price of the common stock during the period exceeds the exercise price of the options and warrants. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS.

~~There~~The ~~were~~Company nomaintains ~~adjustments~~its tocash ~~net~~with ~~(loss)~~one ~~required~~domestic financial ~~for~~institution. ~~purposes~~From oftime ~~computing~~to ~~diluted~~time, ~~earnings~~cash ~~per~~balances ~~share.~~in Atthis ~~March~~domestic ~~31,~~bank ~~2024~~may ~~and~~exceed ~~March~~federally ~~31,~~insured ~~2023,~~limits ~~the~~provided ~~Company~~by ~~excluded~~ the ~~outstanding~~Federal ~~securities~~Deposit ~~summarized~~Insurance ~~below,~~Corporation ~~which~~(“FDIC”) ~~entitle~~of ~~the~~up ~~holders thereof~~ to ~~acquire shares of common stock~~$250, ~~from its calculation of its diluted earnings per share, as their effect would have been anti-dilutive~~000.

Schedule of antidilutive shares
	March 31, 2024		March 31, 2023
Options		–		1,250,000
Warrants		30,260,574		53,927,834

As of September 30, 2024, Company had no deposits in excess of federally insured limit with one bank. The Company believes that no significant concentration of credit risk exists with respect to this cash balances because of its assessment of the creditworthiness and financial viability of this financial institution.

~~Concentrations~~Equity Method Investment

~~Cash~~The –Company ~~cash~~accounts isfor ~~deposited~~investments in entities ~~one~~in which the Company has significant influence over the entity’s financial and operating policies, but does not ~~institution~~control, using the equity method of accounting. The ~~balances~~equity ~~held~~method atinvestments ~~this~~are ~~financial~~initially ~~institution~~recorded at ~~times~~cost, and subsequently increased for capital contributions and allocations of net income, and decreased for capital distributions and allocations of net loss. Equity in net income (loss) from the equity method investment is allocated based on the Company’s economic interest. Equity method investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If it is determined that a loss in value of the equity method investment is other than temporary, an impairment loss is measured based on the excess of ~~Federal~~the ~~Deposit~~carrying ~~Insurance~~amount ~~Corporation~~of ~~(“FDIC”)~~an investment over its estimated fair value. Impairment ~~insurance~~analyses ~~limits~~are based on current plans, intended holding periods, and available information at the time the analysis is prepared. Based on Management’s assessment, the value of upits toequity method investment was impaired as of June 30, 2023. As of September 30, 2024 and June 30, 2024, the remaining de minimus value of its investments was $~~250~~1,000, respectively.

~~Accounts~~Income Payable and Accrued Expenses – three vendors accounted for 34%, 12% and 11% of accounts payable and accrued expenses as of March 31, 2024. Two vendors accounted for 22% and 36% of accounts payable and accrued expenses as of June 30, 2023.Taxes

~~Revenues~~The –Company ~~during~~follows the ~~three~~asset and ~~nine~~liability method ~~months~~of ~~ended~~accounting ~~March~~for 31income taxes. The Company recognizes deferred tax assets and liabilities to reflect the estimated future tax effects, calculated ~~2024~~at anticipated future tax rates, ~~all~~of ~~revenues~~future ~~were~~deductible ~~generated~~or ~~from~~taxable ~~Desmet~~amounts ~~Ballestra~~attributable ~~(Desmet;~~to ~~see~~events ~~Note~~that 2)have been recognized on a cumulative basis in the financial statements. ~~During~~A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion of the ~~three~~deferred ~~months~~tax asset will not be realized. Deferred tax assets and ~~nine~~ ~~months~~liabilities ~~ended~~are ~~March~~adjusted ~~31,~~for ~~2023,~~the ~~95%~~effects of ~~revenues,~~the ~~for~~changes ~~each~~in ~~period,~~tax ~~was~~laws ~~from~~and ~~Desmet~~rates of the date of enactment.

~~Fair Value Measurement~~Leases

~~FASB~~The ~~Accounting~~Company ~~Standards~~accounts ~~Codification~~for ~~(“ASC”)~~its leases in accordance ~~820-10~~with ~~requires~~the ~~entities~~guidance toof ~~disclose~~FASB ~~the~~ASC ~~fair~~842, ~~value~~Leases. ofThe ~~financial~~Company ~~instruments~~determines whether a contract is, ~~both~~or contains, a lease at inception. Right-of-use assets ~~and~~represent ~~liabilities~~the ~~recognized~~Company’s ~~and~~right ~~not~~to ~~recognized on~~use an underlying asset during the ~~balance~~lease ~~sheet~~term, ~~for~~and ~~which~~lease itliabilities isrepresent ~~practicable~~the Company’s obligation to ~~estimate~~make ~~fair~~lease ~~value.~~payments ~~ASC~~arising ~~820~~from the lease. Right-10of-use ~~defines~~assets and lease liabilities are recognized at lease commencement based upon the ~~fair~~estimated present value of aunpaid ~~financial~~lease ~~instrument~~payments as over the ~~amount~~lease atterm. ~~which~~The Company uses its incremental borrowing rate based on the ~~instrument~~information ~~could~~available beat ~~exchanged~~lease commencement in adetermining ~~current~~the ~~transaction~~present ~~between~~value ~~willing~~of ~~parties~~unpaid lease payments (see Note 4).

~~The~~Fair ~~three~~Value ~~levels of the fair value hierarchy are as follows:~~Measurement

·FASB ~~Level~~ASC 1 820-10 ~~Valuations~~requires ~~based~~entities onto ~~unadjusted~~disclose ~~quoted prices in active markets for identical assets or liabilities that~~ the fair ~~entity~~value ~~has~~of ~~the~~financial ~~ability~~instruments, toboth ~~access. · Level 2 - Valuations based on quoted prices for similar~~ assets orand liabilities, ~~quoted~~recognized ~~prices~~and ~~in markets that are~~ not ~~active,~~recognized oron ~~other~~the ~~inputs~~balance ~~that~~sheet ~~are observable or can be corroborated by observable data~~ for ~~substantially~~which ~~the~~it ~~full~~is ~~term~~practicable to ofestimate ~~the~~fair ~~assets or liabilities~~value. ·ASC ~~Level 3~~ 820-10 ~~Valuations~~defines ~~based~~the onfair ~~inputs~~value ~~that~~of ~~are~~a ~~unobservable,~~financial ~~supported~~instrument byas ~~little~~the oramount noat ~~market~~which ~~activity~~the ~~and~~instrument ~~that~~could ~~are~~be ~~significant~~exchanged in toa ~~the~~current ~~fair~~transaction ~~value~~between ofwilling ~~the assets or liabilities~~parties.

OnIn ~~March~~addition 31to defining fair value, ~~2024~~the standard expands the disclosure requirements around fair value and ~~June~~establishes ~~30,~~a ~~2023,~~fair value hierarchy for valuation inputs. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value ~~values~~measurement is reported in one of ~~cash~~the ~~and~~three ~~cash~~levels ~~equivalents,~~which ~~accounts~~are ~~payable~~determined ~~and~~by ~~accrued~~the ~~expenses,~~lowest ~~and~~level ~~accrued~~input ~~payroll~~that ~~and~~is ~~payroll~~significant ~~taxes~~to ~~approximate~~the ~~their~~fair ~~carrying~~value ~~values~~measurement ~~due~~in toits ~~their~~entirety. ~~short-term~~These ~~nature.~~levels are:

~~Segments~~Level 1 - inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.

~~The~~Level ~~Company~~2 ~~has~~- ~~two~~inputs ~~entities~~are orbased ~~subsidiaries, Cavitation~~upon ~~Technologies,~~significant ~~Inc.~~observable inputs ~~and~~other ~~its~~than ~~wholly~~quoted ~~owned~~prices ~~subsidiary~~included ~~Hydrodynamic~~in ~~Technology~~Level 1, ~~Inc.~~such ~~Operations~~as ofquoted ~~these~~prices ~~two~~for ~~subsidiaries~~identical ~~are~~or ~~integrated since they have a~~ similar ~~customer~~instruments ~~base~~in ~~and~~markets ~~the~~that ~~Company~~are ~~has a single sales team, marketing department, customer service department, operations~~not ~~department~~active, ~~finance~~ and ~~accounting~~model-based ~~department~~valuation totechniques ~~support~~for ~~its~~which ~~operations.~~all Insignificant ~~accordance~~assumptions ~~with~~are ~~the~~observable ~~“Segment~~in ~~Reporting” Topic of~~ the ~~ASC,~~market ~~the~~or ~~Company’s~~can ~~chief~~be ~~operating~~corroborated by ~~decision~~observable ~~maker~~market ~~(the~~data ~~Company’s~~for ~~Chief~~substantially ~~Executive~~the ~~Officer)~~full ~~determined~~term ~~that~~of the ~~Company has~~assets ~~only one reporting unit~~ or ~~segment~~liabilities.

~~Recent~~Level ~~Accounting~~3 ~~Pronouncements~~- inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.

InAs ~~June~~of ~~2016~~September 30, ~~the~~2024, ~~Financial~~and ~~Accounting~~June ~~Standards Board~~30, ~~(the “FASB”) issued ASU No. 2016-13~~2024, ~~Credit~~the ~~Losses~~carrying value ~~– Measurement~~ of ~~Credit~~certain ~~Losses~~accounts onsuch ~~Financial~~as ~~Instruments~~accounts ~~(“ASU 2016-13”).~~payable, ~~ASU~~accrued ~~2016-13~~expenses ~~requires~~and ~~entities~~accrued topayroll ~~use~~approximates atheir ~~forward-looking~~fair ~~approach~~value ~~based~~due onto ~~current~~the ~~expected credit losses (“CECL”)~~short-term tonature ~~estimate credit losses on certain types~~ of ~~financial~~such instruments~~, including trade receivables~~. ~~This~~The ~~may~~carrying ~~result~~value ~~in the earlier recognition~~ of ~~allowances~~our ~~for~~note ~~losses.~~payable ~~ASU~~approximate ~~2016-13~~their isfair ~~effective~~value ~~for~~due ~~the Company beginning July 1, 2023. The Company does not believe the new guidance and related codification improvements was material~~ to ~~its~~interest ~~financial~~rate ~~position, results~~ of ~~operations~~the ~~and cash flows~~note.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements.9

~~Note~~Research 2and ~~– Contracts~~Development ~~with Desmet~~Costs

InResearch ~~October~~and ~~2021,~~development ~~the~~expenses ~~Company executed a three-year~~relate ~~agreement~~primarily ~~with~~to ~~Desmet~~the ~~Belgium S.A. (“Desmet”~~development,~~”Licensee”~~ ~~and previously known as Desmet Ballestra~~design,) ~~that~~testing ~~was a continuation~~ of ~~the~~preproduction ~~October~~prototypes ~~2018~~and ~~agreement~~models, ~~for~~compensation, ~~the~~and ~~sale~~consulting ~~of the Company’s reactors. As part of the agreement~~fees, ~~Desmet~~and ~~also provided~~are ~~the~~expensed ~~Company~~as ~~monthly~~incurred. ~~advances~~Total ofresearch ~~$40,000~~and todevelopment becosts ~~applied~~recorded ~~against~~during ~~future~~the ~~sales~~three ofmonths ~~reactors.~~ended AsSeptember ~~of June~~ 30, ~~2023,~~2024 ~~outstanding~~and ~~advances from~~2023 ~~Desmet~~ amounted to $~~391~~8,000 and $36,000, respectively.

9Net Loss Per Share

~~From~~The ~~July~~Company’s ~~2023~~computation upof net income (loss) per share (“EPS”) includes basic and diluted EPS. Basic EPS is measured as the income available to ~~February~~common ~~14,~~stockholders ~~2024~~divided by the weighted average common shares outstanding for the period. Diluted income per share reflects the potential dilution, using the treasury ~~Company~~stock method, that could occur if securities or other contracts to issue common stock were exercised or converted into common ~~received~~stock ~~advances~~or resulted in the issuance of ~~$357,000~~common ~~from~~stock ~~Desmet.~~that ~~The~~then ~~Company~~shared ~~also~~in ~~recorded~~the ~~revenues~~income ~~from~~of the ~~sale~~Company as if they had been converted at the beginning of ~~reactors~~the ~~totaling~~periods ~~$213~~presented,~~000,~~ ofor ~~which~~issuance date, ~~$194~~if later. In computing diluted income per share,~~000~~ the treasury stock method assumes that outstanding ~~was~~options ~~applied~~and warrants were exercised and the proceeds are used to purchase common stock at the ~~outstanding~~average ~~advances~~market ~~while~~price during the ~~remaining~~period. Options ~~$19~~and warrants may have a dilutive effect under the treasury stock method only when the average market price of the common stock during the period exceeds the exercise price of the options and warrants. Potential common shares that have an anti-dilutive effect (i.e.,~~000~~ those ~~was~~that ~~recorded~~increase asincome ~~accounts~~per ~~receivable~~share or decrease loss per share) are excluded from the calculation of diluted EPS.

OnThere ~~February~~were ~~15,~~no ~~2024,~~adjustments ~~the~~to ~~Company~~net ~~terminated the~~income ~~October 2021 agreement and entered into a new three-year Technology License Agreement~~ (~~“TLA”~~loss) ~~with Desmet. The TLA provides~~required for apurposes ~~worldwide limited exclusive license to market, sell, supply and assistance to customers~~ of ~~Nano~~computing ~~reactor~~diluted ~~systems~~earnings ~~and~~per ~~nano~~share. ~~reactor devices~~At ~~for~~September ~~the treatment of certain oil and fats~~30, ~~oleochemicals,~~2024 ~~biodiesels, fatty acids~~ and ~~fatty~~2023 ~~alcohols.~~the ~~The~~Company ~~TLA~~excluded ~~may~~the beoutstanding ~~terminated~~securities bysummarized ~~Desmet~~below, ~~every~~which ~~March~~entitle ~~of year upon notice. As part of~~ the ~~TLA,~~holders ~~Desmet~~thereof ~~agreed~~ to ~~provide~~acquire ~~advances~~shares of ~~$25,000 per~~common ~~month~~stock, ~~subject~~from toits ~~limitations.~~calculation ~~The advances will then be applied as payment against future sales~~ of ~~reactors~~its todiluted ~~Desmet.~~earnings Inper ~~addition~~share, ~~Desmet~~as ~~also~~their ~~waived~~effect ~~its~~would ~~right~~have tobeen ~~collect~~anti-dilutive ~~certain outstanding advances totaling $498,000 made under the October 2021 TLA and~~ as ~~result,~~ the ~~Company~~exercise ~~recognized~~price ~~licensing revenue~~ of ~~$498,000 to account for the extinguishment of~~ these ~~advances.~~warrants ~~The~~were ~~TLA~~greater isthan the ~~principal~~stock ~~agreement~~price ~~between~~of the ~~Company and Desmet and the~~ ~~basis for revenue recognition for the~~ Company. Ascommon ~~such, the Company has determined that the inherent characteristics of the waiver of the $498,000 are revenue related~~stock.

In March 2024, the Company received an advance payment for $326,000 from Desmet pursuant to a purchase order of reactors totaling $652,000. The Company accounted the advance payment as part of Advances from Desmet. The Company delivered these reactors on May 3, 2024.

September 30,

2024

September 30,

2023

Warrants

28,841,323

53,657,234

~~As of June 30, 2023, outstanding advances from Desmet amounted to $382,000.~~Concentrations

InDuring ~~accordance with ASC 606,~~ the ~~Company~~three ~~recognizes revenue~~months ~~from~~ended ~~the~~September ~~sale~~30, of2024 ~~reactors to Desmet at the time of shipment of the Nano reactor hardware as shipment is deemed to be the Company’s only performance obligation~~ and ~~the Company had no more continuing obligation other than the reactor’s two-year standard warranty.~~ ~~Desmet~~2023, ~~pays~~we ~~for such reactors on credit terms and the amount of a sale is~~ recorded asno ~~a receivable upon acceptance by Desmet~~revenue.

~~During~~As ~~the~~of ~~three~~September ~~and~~30, ~~nine~~2024, ~~months~~three ~~ended March~~vendors ~~31,~~accounted ~~2023~~27%, 20% and 9% of the Company’s ~~recorded~~accounts ~~total~~payable. ~~revenue~~As ~~from~~of ~~Desmet~~June of30, ~~$58~~2024,~~000~~ three vendors ~~and~~accounted ~~$361~~19%,~~000 from~~ ~~Nano~~15% ~~Reactor®~~and ~~sales,~~11% ~~respectively~~of the Company’s accounts payable.

~~Note~~At 3September ~~- Investment~~30, in2024 ~~equity~~and ~~method~~June ~~investment~~30, 2024, we had no receivables from our customers.

InRecent ~~April~~Accounting 2019, the Company and an unrelated entity, Delaware Water Company, LLC (Delaware) formed a limited liability company called Enviro WaterTek LLC (“Enviro”). Enviro is owned 50% by the Company and 50% by Delaware, and the Company accounts for its investment in Enviro under the equity method in accordance with ASC 323 as the Company’s investments in Enviro, an unconsolidated entity and for which it has the ability to exercise significant influence but not control. From inception up to March 31, 2024, Enviro had no operations.Pronouncements

InOther ~~September~~recent ~~2021,~~accounting ~~the~~pronouncements ~~Company~~issued and Delaware entered into a separate agreement under Enviro for a specific project (referred to as “Ameredev”). Delaware has certain contracts in place to provide recycled water to operators of certain active oil and gas wells. Under the agreement, the Company contributed $1.2 million that was used by ~~Ameredev to increase~~ the ~~capacity of certain pipelines and water treatment facilities operated by Delaware. Pursuant~~ ~~to the agreement~~FASB, ~~for~~including ~~each~~its ~~barrel~~Emerging ofIssues ~~recycled~~Task ~~water that Ameredev sells~~Force, ~~Delaware will receive $0.10 per barrel, and~~ the ~~Company~~American ~~will receive~~Institute ~~$0.05~~of ~~per~~Certified ~~barrel~~Public ~~(referred to as usage fees)~~Accountants, ~~with~~and the ~~balance~~Securities ofand ~~net income (loss) from Ameredev being allocated 70% to Delaware~~Exchange ~~and~~Commission ~~30%~~did tonot ~~the~~or ~~Company.~~are ~~The~~not ~~Ameredev~~believed ~~agreement will terminate the earlier of three years (unless extended~~ by ~~unanimous~~management ~~agreement~~to ofhave ~~the Board~~a ~~and~~material ~~Members~~impact ofon ~~Ameredev) from~~ the ~~date~~Company’s ofpresent ~~the agreement~~ or byfuture ~~unanimous~~consolidated ~~agreement of the Board and Members of Ameredev~~financial statements.

~~As of March 31, 2024 and June 30, 2023, the balance of the equity method investment amounted to $1,000, for both periods presented.~~10

~~During~~Note ~~the~~2 ~~three~~– Contracts ~~and~~with ~~nine months ended March 31, 2023, the Company recognized a loss of $14,000 and $43,000 related to the equity method investment.~~Desmet

~~There~~In ~~was no similar~~October ~~transactions~~2021, ~~during~~ the Company signed a three-year ~~months~~global Research and ~~nine~~Development, ~~months~~Marketing ~~ended~~and ~~March~~Technology 31License Agreement (“TLA”) with Desmet Ballestra (“Desmet”) for the sale and licensing of the Company’s nano reactors. This agreement was a continuation of the similar TLA agreements the Company signed with Desmet in fiscals 2012, ~~2024~~2016 and 2018.

~~Note~~As 4part ~~– Operating~~of ~~Lease~~the agreement, Desmet provided the Company monthly advances, subject to certain limitations, of $40,000 to be applied against future sales of reactors.

~~The~~In February 2024, Desmet and the Company ~~leases~~terminated the ~~certain~~October ~~warehouse~~2021 TLA agreement and ~~corporate~~entered into a new three-year Technology License Agreement (“February 2024 TLA”). The ~~office~~February ~~space~~2024 ~~under~~TLA anprovides ~~operating~~for ~~lease~~a ~~agreement~~worldwide limited exclusive license to market, sell, supply and assistance to customers of Nano reactor systems and nano reactor devices for the treatment of certain oil and fats, oleochemicals, biodiesels, fatty acids and fatty alcohols. The WeFebruary ~~determine~~2024 TLA may be terminated by Desmet on March 15 each year on at least one month’s written notice if anthe ~~arrangement~~licensee and isits affiliates failed to sell a ~~lease~~minimum atof ~~inception~~6 nano reactor systems during the preceding 12 month period. ~~Lease~~As ~~assets~~part ~~are~~of ~~presented~~the February 2024 TLA, Desmet also agreed to provide advances of $25,000 per month, subject to limitations. The advances will then be applied as payment ~~operating~~against ~~lease~~future ~~right-~~sales of~~-use~~ ~~assets~~reactors ~~and~~to Desmet. The TLA is the ~~related~~principal ~~liabilities~~agreement ~~are~~between ~~presented~~the asCompany ~~lease~~and ~~liabilities~~Desmet inand ~~our~~the ~~consolidated~~basis ~~balance~~for ~~sheets~~revenue recognition for the Company.

10In accordance with ASC 606, the Company recognizes revenue from the sale of reactors to Desmet at the time of shipment of the Nano reactor hardware as shipment is deemed to be the Company’s only performance obligation and the Company had no more continuing obligation other than the reactor’s two-year standard warranty. Desmet pays for such reactors on credit terms and the amount of a sale is recorded as a receivable upon acceptance by Desmet. Monthly advances received from Desmet are initially recorded as advances from distributor (i.e deferred revenues) and will only be recognized as revenues once the Company has completed its performance obligation to Desmet.

~~Operating~~During ~~lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on~~ the ~~present~~three ~~value~~months ofended ~~lease~~September ~~payments~~30, ~~over the lease term. ROU assets~~2024, ~~represent~~pursuant ~~our right~~ to ~~use~~these anTLA ~~underlying~~agreements, ~~asset for~~ the ~~lease~~Company ~~term~~did ~~and~~not ~~lease~~receive ~~liabilities~~any ~~represent~~advances ~~our obligation to make lease payments arising~~ from ~~the~~Desmet ~~lease. Generally, the implicit rate of interest in lease arrangements is not readily determinable~~ and ~~the~~no ~~Company~~revenue ~~utilizes its~~was ~~incremental~~recognized ~~borrowing~~from ~~rate~~sales into ~~determining the present value of lease payments~~Desmet. ~~The Company’s incremental borrowing rate is a~~ ~~hypothetical~~During ~~rate~~the ~~based~~three onmonths ~~its~~ended ~~understanding~~September of30, ~~what~~2023, ~~its~~advances ~~credit~~received ~~rating~~from ~~would~~Desmet ~~be.~~amounted ~~The~~to ~~operating~~$304,000 ~~lease~~and ~~ROU~~no ~~asset~~revenue ~~includes~~was ~~any~~recognized ~~lease payments~~from ~~made~~sales ~~and~~to ~~excludes lease incentives~~Desmet.

~~The~~As ~~components~~ of ~~lease~~September ~~expense~~30, 2024 and ~~supplemental cash~~June ~~flow~~30, ~~information~~2024, ~~related~~there was no outstanding toadvances ~~leases~~from ~~for the period are as follows:~~Desmet.

Schedule of components of lease expense and supplemental cash flow information
	March 31,		March 31,
	2024		2023
Lease costs:
Operating lease (included in general and administrative in the Company’s consolidated statement of operations)	$	53,000	$	57,000
Other information:
Cash paid for amounts included in the measurement of lease liabilities	$	56,000	$	57,000
Weighted average remaining lease term – operating leases (in years)		0.8		1.8
Average discount rate – operating leases		4%		4%

Note 3 - Investment in equity method investment

~~The~~In ~~supplemental~~April ~~balance~~2019, ~~sheet~~the ~~information~~Company ~~related~~and an unrelated entity, toDelaware ~~leases~~Water Company, LLC (Delaware) formed a limited liability company called Enviro WaterTek LLC (“Enviro”). Enviro is owned 50% by the Company and 50% by Delaware, and the Company accounts for its investment in Enviro under the ~~period~~equity ismethod in accordance with ASC 323 as ~~follows:~~the Company’s investments in Enviro, an unconsolidated entity and for which it has the ability to exercise significant influence but not control. From inception up to September 30, 2024, Enviro had no operations.

Schedule of supplemental balance sheet information for leases
	March 31, 2024
Long-term right-of-use assets	$	60,000
Short-term operating lease liabilities	$	65,000
Long-term operating lease liabilities		–
Total operating lease liabilities	$	65,000

~~Supplemental~~In ~~cash~~September ~~flow~~2021, ~~information~~the ~~related~~Company and Delaware entered into a separate agreement under Enviro for a specific project (referred to as “Ameredev”). Delaware has certain contracts in place to provide recycled water to operators of certain active oil and gas wells. Under the ~~lease~~agreement, ~~liabilities~~the Company contributed $1.2 ~~are~~million that was used by Ameredev to increase the capacity of certain pipelines and water treatment facilities operated by Delaware. Pursuant to the agreement, for each barrel of recycled water that Ameredev sells, Delaware will receive $0.10 per barrel, and the Company will receive $0.05 per barrel (referred to as ~~follows:~~usage fees), with the balance of net income (loss) from Ameredev being allocated 70% to Delaware and 30% to the Company. The Ameredev agreement will terminate the earlier of three years (unless extended by unanimous agreement of the Board and Members of Ameredev) from the date of the agreement or by unanimous agreement of the Board and Members of Ameredev.

Schedule of lease maturities
	Operating
Year Ending June 30:	Lease
2024 (remaining 3 months)	$	20,000
2025		46,000
Total lease payments		66,000
Less: Imputed interest/present value		(1,000	)
Present value of lease liabilities	$	65,000

Based upon the operations of Ameredev and the facts and circumstance of the industry it operates, due to a number of factors, Management has concluded that it was no longer possible to determine reasonable and objectively supportable projections and estimates with regards to the recoverability of the equity method investment. As such, at June 30, 2023, the Company determined the equity method investment was impaired and recorded an additional $1,112,000 in loss to its investment, reducing the value of the equity method investment to a de minimis amount of $1,000.

~~Effective~~During ~~February 1, 2024,~~ the ~~Company~~three ~~sublet 65%~~months ofended ~~the~~September ~~premises~~30, to2024 ~~a third party for a monthly rental income of $4~~and 2023,~~294.~~ ~~Due~~Ameredev’s tooperation ~~the~~were ~~short-term~~limited ~~nature~~and of the ~~lease the~~ Company ~~applied the~~had ~~practical~~no ~~expedient,~~revenues ~~not~~from ~~to account for the lease in terms of ASC 842~~Ameredev.

~~Note~~As 5of ~~– Related~~September ~~Party~~30, ~~Transactions~~2024 and June 30, 2024, the balance of the equity method investment amounted to $1,000, for both periods presented.

~~Accrued~~Note ~~Payroll~~4 ~~and~~– Operating ~~Payroll Taxes~~Lease

InThe ~~prior~~Company ~~periods,~~leases ~~the~~certain ~~Company~~warehouse ~~accrued~~and ~~salaries~~corporate ~~and~~office ~~estimated~~space ~~payroll~~under ~~taxes~~an ~~due~~operating tolease aagreement. ~~former~~We ~~officer~~determine ofif ~~the~~an ~~Company~~arrangement is a lease at inception. AsLease ofassets ~~June~~are ~~30,~~presented ~~2023,~~as operating ~~total~~lease ~~accrued~~right-of-use ~~payroll~~assets and ~~payroll~~the ~~taxes-~~related ~~parties~~ ~~amounted~~liabilities ~~$280,000~~are presented as lease liabilities in our consolidated balance sheets.

~~During~~Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the ~~nine~~present ~~months~~value ~~ended~~of ~~March~~lease ~~31,~~payments ~~2024,~~over the lease term. ROU assets represent ~~Company~~our ~~accrued~~right to use an underlying asset for the ~~payroll~~lease ofterm anand ~~officer~~lease liabilities represent our obligation to make lease payments arising from the lease. Generally, the implicit rate of interest in lease arrangements is not readily determinable and the Company ~~amounting~~utilizes toits incremental ~~$128,000~~borrowing rate in determining the present value of lease payments. The Company’s incremental borrowing rate is a hypothetical rate based on its understanding of what its credit rating would be. The operating lease ROU asset includes any lease payments made and excludes lease incentives.

AsThe components of ~~March~~lease ~~31,~~expense ~~2024,~~and ~~total~~supplemental cash ~~accrued~~flow ~~payroll~~information ~~and payroll taxes-~~related ~~parties~~to ~~amounted~~leases tofor ~~$408,000.~~the period are as follows:


	September 30,		September 30,
	2024		2023

Lease costs:
Operating lease (included in general and administrative in the Company’s consolidated statement of operations)	$	19,000	$	19,000

Other information:
Cash paid for amounts included in the measurement of lease liabilities	$	21,000	$	17,000

Weighted average remaining lease term – operating leases (in years)		0.3		1.3
Average discount rate – operating leases		4%		4%

The supplemental balance sheet information related to leases for the period is as follows:
Long-term right-of-use assets	$	24,000	$	95,000

Short-term operating lease liabilities	$	27,000	$	68,000
Long-term operating lease liabilities		–		34,000
Total operating lease liabilities	$	27,000	$	102,000

~~Note 6 – Notes Payable~~12

InSupplemental ~~July~~cash ~~2020,~~flow ~~the~~information ~~Company~~related ~~received~~to ~~a loan of $150,000 from~~ the ~~SBA under its Economic Injury Disaster Loan (EIDL) assistance program. The EIDL loan is payable over 30 years, bears~~ ~~interest~~lease atliabilities aare ~~rate~~as offollows: ~~3.75% per annum and secured by all tangible and intangible property of the Company.~~

Pursuant to the terms of the SBA EIDL loan agreement, the Company is required to make monthly installment payments of approximately $700 starting in July 2021. However, the Company was not able to pay the required monthly installment due from July 2021 to April 2023.


	Operating
Year Ending June 30:	Lease
2025 (remaining 9 months)	$	27,000
Less: Imputed interest/present value		–
Present value of lease liabilities	$	27,000

InNote ~~May~~5 2023, the Company was able to cure the payment delay with the SBA and started paying the monthly installment due of approximately $731. As part of the agreement, all payments will be first applied to accrued interest until the Company becomes current with the interest due, As of March 31, 2024 and June 30, 2023 approximately $12,000– ~~and~~Related ~~$13,000,~~Party ~~respectively, of accrued interest is included in accounts payable and accrued expenses.~~Transactions

AsAccrued ofPayroll ~~March 31, 2024~~ and ~~June~~Payroll ~~30, 2023, the outstanding loan balance amounted to $150,000, respectively.~~Taxes

~~Note~~In 7prior ~~- Stockholders'~~periods, ~~Equity~~the Company accrued salaries and estimated payroll taxes due to a former officer of the Company amounting to $280,000, and accrued salaries and estimated payroll taxes for the current officer and director of the Company amounting to $134,000, totaling $414,000 as of June 30, 2024.

~~Stock~~During ~~Warrants~~the three months ended September 30, 2024, the Company recorded an additional $12,000 in accrued salaries and related payroll taxes for the current officer and director of the Company.

AAs ~~summary~~ of ~~the~~September ~~Company's~~30, ~~warrant~~2024, ~~activity~~total ~~and~~accrued payroll ~~related~~and ~~information~~payroll ~~for~~related ~~the~~taxes ~~nine~~amounted ~~months~~to ~~ended on March 31~~$426, ~~2024 is as follows:~~000.

Schedule of warrant activity
	Warrants			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (Years)
Outstanding at June 30, 2023		53,657,234		$	0.09		1.82
Granted		–			–		–
Exercised		–			–		–
Expired		(23,396,660	)		0.10		–
Outstanding at March 31, 2024 vested and exercisable		30,260,574		$	0.08		2.73

Note 6 – Notes Payable

There was no intrinsic value of the outstanding warrants as of March 31, 2024, as the exercise price of these warrants were greater than the market price.

Schedule of notes payable
	September 30,			June 30,
	2024			2024
Note payable - EIDL	$	137,000		$	139,000
Short-term note payable		(9,000	)		(9,000	)
Long-term note payable	$	128,000		$	130,000

In July 2020, the Company received a loan of $150,000 from the SBA under its Economic Injury Disaster Loan (EIDL) assistance program. The ~~following~~EIDL ~~table~~loan ~~summarizes~~is ~~additional~~payable ~~information~~over 30 years, bears interest at a ~~concerning~~rate ~~warrants~~of 3.75% ~~outstanding~~per annum and ~~exercisable~~secured atby ~~March~~all ~~31,~~tangible ~~2024~~and intangible property of the Company.

Schedule of warrants outstanding and exercisable
		Warrants Outstanding						Warrants Exercisable
				Weighted		Weighted				Weighted
				Average		Average				Average
Exercise		Number		Remaining		Exercise		Number		Remaining
Price		of Shares		Life (Years)		Price		of Shares		Life (Years)
$	0.03		6,419,251		4.49	$	0.03		6,419,251		4.49
$	0.09		23,841,323		2.25		0.09		23,841,323		2.25
			30,260,574						30,260,574

12Note 7 - Stockholders' Equity

~~Note~~Stock ~~8 - Commitments and Contingencies~~Warrants

~~Royalty~~A ~~Agreements~~summary of the Company's warrant activity and related information for the three months ended September 30, 2024 is as follows:

On July 1, 2008, the Company entered into Patent Assignment Agreements with two parties, our President and Technology Development Supervisor, where certain devices and methods involved in the hydrodynamic cavitation processes invented by the President and the Technology Development Supervisor have been assigned to the Subsidiary. In exchange, the Subsidiary agreed to pay a royalty of 5% of gross revenues to each of the President and Technology Development Supervisor for licensing of the technology and leasing of the related equipment embodying the technology. These agreements were subsequently assumed by Cavitation Technologies on May 13, 2010 from its subsidiary. The Company's President and Technology Development Supervisor both waived their rights to receive royalty payments that have accrued, or that may accrue, on any gross revenue generated through March 31, 2024.

Warrants

Weighted-

Average

Exercise

Price

Weighted-
Average
Remaining
Contractual
Life
(Years)

Outstanding at June 30, 2024

28,841,323

0.08

2.61

Granted

–

Exercised

–

Expired

–

Outstanding at September 30, 2024 vested and exercisable

28,841,323

0.08

2.36

OnThere ~~April~~was ~~30,~~no ~~2008~~intrinsic ~~and~~value ~~as amended on November 22, 2010, our wholly owned subsidiary entered into an employment agreement with our former Director~~ of ~~Chemical~~the ~~and~~outstanding ~~Analytical Department~~warrants ~~(the~~as ~~“Inventor”) to receive an amount equal to 5%~~ of ~~actual~~September ~~gross~~30, ~~royalties received from the royalty stream in the first year in which the Company receives royalty payments from the patent which the Inventor was the legally named inventor~~2024, ~~and~~as ~~3% of actual gross royalties received by~~ the ~~Company~~exercise ~~resulting~~price ~~from the patent in each subsequent year. As~~ of ~~March~~these ~~31,~~warrants ~~2024~~were nogreater ~~patents~~than ~~have been granted in which this person is~~ the ~~legally~~market ~~named inventor~~price.

13The following table summarizes additional information concerning warrants outstanding and exercisable at September 30, 2024.

ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.


		Warrants Outstanding						Warrants Exercisable
				Weighted		Weighted				Weighted
				Average		Average				Average
Exercise		Number		Remaining		Exercise		Number		Remaining
Price		of Shares		Life (Years)		Price		of Shares		Life (Years)

$	0.03		5,000,000		5.26	$	0.03		5,000,000		5.26
$	0.09		23,841,323		1.75	$	0.09		23,841,323		1.75
			28,841,323						28,841,323

The following discussion and analysis should be read in conjunction with our financial statements and the related notes. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, such as its plans, objectives, expectations and intentions. Its actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements.14

~~Overview~~Note of8 ~~our~~- Commitments ~~Business~~and Contingencies

~~Cavitation~~Royalty Technologies, Inc. ("CTi"), a Nevada corporation, was originally incorporated under the name Bio Energy, Inc. We design and engineer environmentally friendly technology-based systems that are designed to serve large, growing, global markets such as vegetable oil refining, renewable fuels, water treatment, algae oil extraction, biodiesel production, water-oil emulsions and crude oil yield enhancement. Our systems are designed to process industrial liquids at a lower cost and higher yield than conventional technology. We are a process and product development firm that has developed, patented, and commercialized proprietary technology.Agreements

~~CTi~~On ~~has~~July ~~developed~~1, ~~patented~~2008, ~~and~~the ~~commercialized~~Company’s wholly owned ~~proprietary~~subsidiary ~~technology~~entered ~~that~~into ~~can~~Patent beAssignment ~~used~~Agreements ~~for~~with ~~processing~~two ofparties, ~~industrial~~its ~~fluids.~~President ~~CTi's~~as ~~patented Nano~~well ~~Reactor® is~~as ~~the critical~~its ~~components~~former ~~of the~~Chief ~~CTi~~Executive ~~Nano~~Officer ~~Neutralization® System~~(CEO) and ~~which~~current isTechnology ~~commercially~~Senior ~~proven~~Manager, towhere ~~reduce~~certain ~~operating~~devices ~~costs~~ and ~~increase~~methods ~~yields~~involved in ~~processing~~the ~~oils~~hydrodynamic cavitation processes invented by the President and ~~fats.~~former ~~CTi~~CEO/ ~~has~~current ~~two~~Technology ~~issued~~Senior ~~patents~~Manager ~~relating~~have been assigned to ~~our~~the ~~Nano Reactor® systems~~Company. In exchange, the Company agreed to pay a royalty of 5% of gross revenues to each of the President and ~~has~~former ~~filed~~CEO/ ~~several~~current ~~national~~Technology Senior Manager for licensing of the technology and ~~international~~leasing ~~patents~~of tothe ~~employ~~related ~~its~~equipment ~~proprietary~~embodying the technology. inThese ~~applications~~agreements ~~including,~~were ~~vegetable~~subsequently ~~oil~~assigned to Cavitation Technologies ~~refining,~~on ~~biodiesel~~May ~~production~~13, ~~waste~~2010. The ~~water~~Company’s ~~treatment~~former CEO/ current Technology Senior Manager and President both waived their rights to receive royalty payments that have accrued, ~~algae~~or ~~oil~~that ~~extraction~~may accrue, ~~and~~on ~~alcoholic~~any ~~beverage~~gross ~~enhancement~~revenue generated through September 30, 2024 and 2023.

WeOn ~~are~~April ~~engaged~~30, in2008 ~~manufacturing~~(as ~~our~~amended ~~Nano-Reactors~~November 22, 2010), ~~which~~the ~~are~~Company’s ~~designed~~wholly toowned ~~help~~subsidiary ~~refine~~entered ~~vegetable~~into ~~oils,~~an ~~biodiesel~~employment ~~transesterification~~agreement ~~and~~with ~~treatment~~the Director of ~~produced~~Chemical and ~~frack~~Analytical ~~water.~~Department (the ~~Our~~“Inventor”) ~~near-term goal~~providing isthat tothe ~~continue~~Inventor shall receive an amount equal to ~~sell~~5% ~~our~~of ~~systems~~actual ~~through~~gross ~~our~~royalties ~~partners,~~received ~~Desmet~~from ~~Ballestra~~the royalty stream in the first year in which the Company receives royalty payments from the patent which the Inventor was the legally named inventor, and EW3% of actual gross royalties received by the Company resulting from the patent in each subsequent year. As of September 30, 2024, no patents have been granted in which this person is the legally named inventor.

~~During~~Note ~~the~~9 ~~past~~– Subsequent several years we have developed a number of new applications utilizing the core principal of our technology. Our low pressure non-reactors (LPN) can be utilized in multiple industries that process large volumes of fluids and we anticipate accelerated commercial sales in our fiscal 2024. Further, we have miniaturized our non-reactors to be utilized in various consumer oriented products, such as, processing and enhancing spirits and wines, drinking water with infusion of vitamins, minerals and cannabidiol (CBD) oil.events

WeThe ~~have~~Company ~~agreements~~has toevaluated ~~license~~subsequent ~~our~~events ~~technology globally~~ through the ~~our~~date ~~strategic~~the ~~partners,~~financial ~~Desmet~~statements ~~Belgium~~were ~~Group~~issued ~~(Desmet)~~ and ~~Enviro~~did ~~Watertek,~~not ~~LLC~~identify ~~(EW)~~any ~~and~~subsequent ~~Alchemy~~events ~~Beverages,~~that ~~Inc~~would ~~(ABI).~~have ~~Desmet~~required ~~had been~~adjustment ~~providing monthly advances of $40,000. We may need additional funding, and may attempt to raise additional debt and/~~or ~~equity financing~~disclosure ~~to fund operations and additional working capital. However, there is no assurance that we will be successful~~ in ~~obtaining~~the ~~such~~financial ~~financing or~~statements ~~obtain~~except ~~sufficient~~as ~~amounts necessary to meet our business needs, or that we will be able to meet our future contractual obligations.~~follows:

~~Inflation~~Patent assignment and license back agreement

~~Global~~The ~~inflation~~Company ~~remains~~has aentered ~~factor~~into an inagreement ~~2024,~~ with ~~interest~~ ~~rates~~Desmet inthat monetized the USCompany ~~remaining~~by atthe ~~higher~~assignment ~~levels,~~of ~~although~~certain ~~there~~of ~~have~~its ~~been~~U.S. ~~some~~and ~~indication~~non-U.S. ~~from~~patents, ~~the~~technical ~~federal~~information and ~~reserve~~related ~~that~~intellectual ~~these~~property ~~rates may~~(the ~~decrease,~~“Assigned ~~inflationary~~Patents”) ~~indicators~~that ~~remain~~for ~~above~~several ~~expectations,~~years ~~delaying~~have ~~any~~been ~~interest~~licensed ~~rate~~to ~~decreases.~~Desmet ~~The~~for ~~Russia~~its ~~and~~use on ~~Ukraine~~a ~~and~~global ~~now the~~basis ~~Israeli~~in ~~and~~vegetable ~~Hamas~~oil, ~~conflict~~fats and ~~other~~oleo ~~geopolitical~~applications. ~~conflicts,~~The asCompany ~~well~~also asassigned ~~related~~to ~~international response~~Desmet, ~~have~~ownership ~~exacerbated~~of ~~inflationary pressures,~~two ~~including~~U.S. ~~causing~~trademark ~~increases~~registrations that init ~~the~~holds ~~price~~ for ~~goods~~its ~~and~~Nano ~~services~~Neutralization® and ~~global~~Nano ~~supply~~Reactor® ~~chain disruptions~~marks, ~~which~~respectively ~~have~~(the ~~resulted~~“Assigned ~~and~~Marks”). The consideration ~~may~~of ~~continue~~the toassignment ~~result~~of inthe ~~shortages~~patents inis ~~food~~$880,000, ~~products~~$480,000 ~~materials~~due ~~and~~upon ~~services.~~the ~~Such~~full ~~shortages~~execution ~~have resulted~~ and ~~may~~delivery ~~continue~~ to ~~result in~~Desmet ~~inflationary~~of ~~cost~~the ~~increases~~Assignment ~~for~~of ~~labor,~~the ~~fuel,~~Assigned Patents ~~food~~and ~~products~~Assigned Trademarks, ~~materials~~ and ~~services~~, ~~and~~the ~~could~~remaining ~~continue~~$400,000 todue ~~cause~~upon ~~costs~~the delivery to ~~increase~~the ~~as well~~Assignee asthe ~~result~~complete inset ~~the~~of ~~scarcity~~Nano ofReactor® Device ~~certain~~manufacturing ~~materials~~drawings. WeThe ~~cannot~~Company ~~predict~~has ~~any~~also ~~future~~agreed ~~trends~~to inprovide ~~the~~to ~~rate~~Desmet ofany ~~inflation~~consultation, ortechnical ~~other~~assistance ~~negative~~and ~~economic~~support services ~~factors~~that orDesmet ~~associated~~may ~~increases~~reasonably request in; ~~our~~(a) installing, operating ~~costs~~or ~~and~~troubleshooting ~~how~~for ~~that~~any ~~may~~Nano ~~impact~~Reactor® ~~our~~Device; ~~business.~~(b) Totesting, ~~the~~startup or ~~extent~~maintenance weof ~~and~~any ~~our~~Nano ~~customers~~Reactor® weDevice ~~service are~~or ~~unable~~any toproblems ~~recover~~associated ~~higher~~therewith; ~~operating~~and ~~costs~~(c) ~~resulting~~providing ~~from~~training ~~inflation~~to representatives, contractors or ~~otherwise~~employees ~~mitigate the impact~~ of ~~such~~Desmet ~~costs~~or onany ~~our~~Site ~~and their business~~User, ~~our~~to ~~revenues~~be ~~and~~charged ~~gross~~at ~~profit~~a ~~could~~rate ~~decrease~~of $1,000 ~~and~~per ~~our~~day, ~~financial~~plus ~~condition~~reimbursement ~~and results~~ of ~~operations~~reasonable ~~could be adversely affected~~expenses.

14Pursuant to the agreement, the Company reserved for itself, and received a Grant Back License (“Reserved Grant Back License”) of a worldwide, exclusive, transferable and royalty-free license and right to practice and use the Assigned Patents and associated technical information in businesses, activities, projects, uses and applications in the field of; (i) water and wastewater processing, recovery, recycling and purification (including oilfield wastewater) and; (ii) manufacture, distillation, brewing, enhancements, sale and marketing of alcoholic beverages, together the Licensed Fields (the “Licensed Fields”). Under the Reserved Grant Back License retained and received, the Company will have a worldwide, exclusive, transferable and royalty-free license and right to design, build, use, export, improve, sell and market Nano Reactor® devices and Nano Reactor® devices and systems (and products) that incorporate or utilize Nano Reactor® devices, in each case within the Licensed Fields, and to continue to use the Nano Reactor® trademark in connection with its business, systems and products within the Licensed Fields.

~~Results~~The Company is currently in the process of ~~Operations~~determining the appropriate accounting for this agreement.

~~Results of Operations for the Three Months Ended March 31, 2024 Compared to the Three Months Ended March 31, 2023~~15

~~The~~Item ~~following~~2. isManagement's aDiscussion ~~comparison~~and Analysis of ~~our~~Financial ~~operation~~Condition ~~results~~and ~~for~~Results ~~the~~of ~~three months ended March 31, 2024 and2023~~Operations.

	For the Three Months Ended
	March 31,
	2024			2023			$ Change			% Change
Revenue	$	519,000		$	61,000		$	458,000			749.2	%
Cost of revenue		(7,000	)		(11,000	)		4,000			36.4	%
Gross profit		512,000			50,000			462,000			922.0	%
General and administrative expenses		170,000			273,000			(103,000	)		(50.9	)%
Research and development expenses		9,000			–			9,000			100.0	%
Total operating expenses		179,000			273,000			(94,000	)		(34.4	)%
Income (loss) from operations		333,000			(223,000	)		556,000			248.9	%
Interest expense		(2,000	)		(15,000	)		13,000			–
Net income (loss) before and after income taxes	$	331,000		$	(238,000	)	$	569,000			247.8	%

~~Revenue~~Overview of our Business

~~The~~Cavitation ~~Company~~Technologies, ~~generates~~Inc. ~~revenues~~("CTi"), ~~from~~a Nevada corporation, was originally incorporated under the ~~sale~~name ofBio Energy, Inc. We design and engineer environmentally friendly technology-based ~~the Nano~~systems ~~Reactor®~~ that are designed to ~~customers/distributor.~~serve ~~Additionally~~large, ~~the~~growing, ~~Company~~global ~~generates~~markets ~~revenues~~such ~~from~~as ~~its~~vegetable ~~equity~~oil ~~method~~refining, ~~investment~~renewable fuels, water treatment, algae ~~specifically~~oil ~~fees~~extraction, ~~from~~biodiesel ~~usage~~production, ofwater-oil ~~reactors~~emulsions orand ~~usage~~crude ~~fees~~oil yield enhancement. Our systems are designed to process industrial liquids at a lower cost and higher yield than conventional technology. We are a process and product development firm that has developed, patented, and commercialized proprietary technology.

~~During~~CTi ~~the~~has ~~three~~developed, ~~months~~patented, ~~ended~~and ~~March~~commercialized ~~31, 2024,~~proprietary ~~the~~technology ~~Company~~that ~~generated~~can ~~$19,000~~be inused ~~revenue~~for ~~from~~processing ~~reactor~~of ~~sales~~industrial ~~pursuant~~fluids. toCTi's ~~one~~patented Nano ~~purchase~~Reactor® is ~~order~~the ~~from~~critical ~~Desmet.~~components of the InCTi ~~addition,~~Nano ~~due~~Neutralization® System which is commercially proven to areduce ~~new~~operating ~~Technology~~costs and increase yields ~~License~~in ~~Agreement~~processing ~~entered~~oils ~~into~~and ~~with~~fats. CTi has two issued patents relating to our ~~worldwide~~Nano Reactor® systems ~~limited~~and ~~distributor~~has infiled ~~February~~several national ~~2024,~~and ~~the~~international ~~rights~~patents to ~~previous~~employ ~~advances~~its ~~made~~proprietary totechnology ~~the~~in ~~Company of~~applications ~~$498~~including,~~000~~ ~~were~~vegetable ~~waived~~oil ~~and~~refining, ~~were~~biodiesel ~~recognized~~production, waste aswater ~~licensing~~treatment, ~~revenue~~algae ~~during~~oil ~~the~~extraction, ~~current~~and ~~three~~alcoholic ~~month~~beverage ~~period~~enhancement.

~~During~~We ~~the~~were ~~three~~engaged ~~months~~in ~~ended~~manufacturing ~~March~~our 31Nano-Reactors, ~~2023 we~~ ~~recorded $61,000 in revenue,~~ which ~~consisted~~are ofdesigned ~~one~~to ~~purchase~~help ~~order~~refine invegetable ~~the amount of $58~~oils,~~000~~ ~~from~~biodiesel ~~Desmet.~~transesterification Inand ~~addition,~~treatment ~~the Company recognized usage fees~~ of ~~$3,000~~produced ~~during~~and ~~the~~frack ~~prior period~~water.

~~Cost~~In prior years we have developed a number of ~~revenue~~new applications utilizing the core principal of our technology. Our low pressure non-reactors (LPN) can be utilized in multiple industries that process large volumes of fluids and we anticipate accelerated commercial sales in our fiscal 2025. Further, we have miniaturized our non-reactors to be utilized in various consumer oriented products, such as, processing and enhancing spirits and wines, drinking water with infusion of vitamins, minerals and cannabidiol (CBD) oil.

~~During~~We ~~the~~had ~~three~~agreements ~~months~~to ~~ended~~license ~~March~~our ~~31,~~technology ~~2024 and~~globally ~~2023,~~through our ~~cost~~strategic ofpartners, ~~revenue~~Desmet ~~amounted~~Belgium toGroup ~~$7,000~~(Desmet) and ~~$11,000~~Enviro ~~respectively during the same period in prior year~~Watertek, ~~this~~LLC ~~represented~~(EW) ~~the~~and ~~cost of~~Alchemy ~~the nano reactors sold to our distributor during each period~~Beverages, asInc ~~discussed above~~(ABI).

~~General~~In October 2024, we entered into a Patent Assignment and ~~administrative~~License ~~expenses~~ Back Agreement with Desmet to assign certain patents, intellectual property rights and trademarks related to vegetable oil refining to Desmet, as consideration for the patent assignments, Desmet agreed to pay the Company $880,000 in cash. This transaction will provide the necessary capital for continuous operations and business development of our company.

~~General~~Key ~~and~~points ~~administrative expenses was $170,000 and $273,000 for the three months ended March 31, 2024 and 2023, a decrease~~ of ~~$139,000 or 50.9%. The decrease is primarily due to a reduction in executive level employees resulting in a decrease in payroll expenses of $75,000 and~~ the ~~issue~~Agreement ~~of stock based compensation in the prior period amounting to $40,000 with no similar expense if the current period.~~included:

~~Research~~· Reserved License: we retained a worldwide, exclusive, transferable, and ~~development~~royalty-free ~~expenses~~license to practice and use the Assigned Patents in the fields of water and wastewater processing, recovery, recycling, and purification (including oilfield wastewater), as well as the manufacture, distillation, brewing, enhancement, sale, and marketing of alcoholic beverages (the “Licensed Fields”).

~~Research~~· ~~and~~Grant-Back ~~development~~License: ~~expenses~~we ~~was~~received ~~$9,000~~a ~~and $0 for the three months ended March 31~~worldwide, ~~2024 and 2023~~exclusive, ~~respectively~~transferable, anand ~~increase~~royalty-free oflicense ~~$9,000~~to orpractice ~~100.0%~~and ~~increase.~~use ~~The increase is due to~~ the ~~resumption~~Assigned ofPatents ~~research~~ and ~~development~~associated ~~expenditure~~technical ~~for~~information, ~~methods~~consistent ~~and~~with ~~technologies~~the scope of ~~water~~the ~~treatment~~Reserved ~~technology~~License.

15· Trademark Usage: we retained exclusive rights to use the “Nano Reactor®” mark for our businesses, systems, and products related to the Licensed Fields.

~~Income (loss) from operations~~16

~~Income~~Under ~~(loss)~~both ~~from~~the ~~operations~~Reserved ~~was~~License ~~$333,000~~ and the Grant-Back ~~$(223~~License,~~000)~~ ~~for~~ the ~~three~~Company ~~months~~will ~~ended~~have ~~March~~a 31worldwide, ~~2024 and 2023~~exclusive, ~~respectively~~transferable, anand ~~increase~~royalty-free oflicense ~~$555,000~~and orright ~~248.9%.~~to ~~The~~design, ~~increase~~build, isuse, ~~primarily~~export, ~~due~~improve, tosell, ~~the~~and ~~increase~~market inNano ~~revenue~~Reactor® ~~related~~devices, toas ~~the~~well ~~waiver~~as ofNano ~~the~~Reactor® ~~previous~~systems ~~advances~~and ~~paid~~products tothat ~~the~~incorporate ~~company~~or byutilize ~~its distributor and a reduction in~~Nano ~~general~~Reactor® ~~and administrative expenses~~devices, ~~offset~~limited byto anuses ~~increase~~and inapplications ~~research~~within inone ~~development~~or ~~expenses,~~more ~~all~~of ~~discussed~~the inLicensed ~~detail above~~Fields.

~~Interest~~As ~~expense~~a result of this agreement, the Company expects that Desmet will start to manufacture the Nano reactors by itself and sale of Nano reactors to Desmet by the Company will significantly be reduced in future periods. We will continue to own and operate a large portfolio of patents and intellectual property rights in applications not related to vegetable oil refining. The following are Management’s plans going forward to generate revenues and sustain the operations of the Company and its current status:

~~Interest~~1. ~~expense~~Water ~~was~~Treatment ~~$1,000~~ and ~~$1,000~~Remediation ~~for~~in the ~~three~~ ~~months~~Permian ~~ended~~Basin ~~March~~2. ~~31,~~Water ~~2024~~Remediation and ~~2023,~~Disinfection ~~respectively~~in Agriculture 3. ~~This~~Business ~~represents~~Venture ~~interest~~with ~~expense~~Alchemy onBeverages, ~~SBA~~Inc. ~~loans~~4. New Technologies: Hydro-Plasma

~~Net~~1. ~~income~~Water ~~(loss)~~Treatment ~~before~~ and ~~after~~Remediation ~~income~~in the ~~taxes~~Permian Basin

~~Net~~From ~~income~~2020 ~~(loss)~~to ~~after~~2022, ~~income~~our ~~taxes~~joint ~~was~~venture ~~$331~~with Enviro Watertek,~~000~~ ~~and~~LLC ~~$(224,000)~~restarted ~~for~~water treatment operations in the ~~three~~Permian ~~months~~Basin. ~~ended~~Although ~~March~~our ~~31,~~technology ~~2024~~demonstrated ~~and~~commercial ~~2023,~~viability ~~respectively~~(approximately 3 million barrels treated), our partner was unable to expand and ~~increase~~attract ofnew ~~$555,000.~~customers ~~The~~due ~~increase~~to issignificant ~~discussed~~shifts ~~under~~in the oil & gas ~~income~~industry. ~~(loss)~~It ~~from~~has ~~operations~~taken ~~above~~several years to rearrange and adapt our technology to fit new customers’ operations.

~~Loss~~Currently, ~~from~~we ~~equity~~have ~~method~~installed ~~investment~~our system at a major water remediation company in Texas, where it has been in place for over six months, with more testing required. We continue to pursue additional customers, primarily in the Permian Basin.

~~Loss~~What ~~from~~differentiates ~~equity~~us ~~method investment was $0 and $14,000 for the three months ended March 31, 2024 and 2023, respectively, a decrease~~ in ~~loss of $14,000. For~~ the three months ended March 31, 2023, the Company recognized a loss of $14,000 to account for its 30% share in the net loss from the equity method investment. There was no similar loss recognized for the three months ended March 31, 2024 as a result of the impairment of the equity method investment in prior year.industry:

~~Net~~· ~~income~~No ~~(loss)~~chemical usage in water remediation, significantly reducing operational costs. · Integration into existing processes within 24 hours, without disrupting ongoing operations. · Compact systems with minimal energy consumption. · Post-treatment water can be either reused or safely disposed of.

~~Net income (loss) was $331,000 and $(238,000) for the three months ended March 31, 2024 and 2023.~~ The ~~increase~~Company inanticipates ~~income~~that ofsales ~~$569,000~~will ~~was~~be ~~due to the increase in income discussed under~~generated ~~income (loss) from operations above and the decrease~~ in the ~~loss~~first ~~from~~half ~~equity~~of ~~method~~fiscal ~~investment~~2025.

~~Results~~2. ofWater ~~Operations~~Remediation ~~for~~and ~~the~~Disinfection ~~nine months ended March 31, 2024 compared~~in ~~to the nine months ended March 31, 2023~~Agriculture

In 2024, we installed our first system at Hacienda Farms (B&F Greenhouse Services, Inc.) in Canada. The ~~following~~system is acurrently undergoing ~~comparison~~trials ofto ~~our~~increase ~~operating~~oxygen ~~results~~levels ~~for~~in the ~~nine months~~water, ~~ended~~eliminate ~~March~~algae, 31and control bacterial growth, ~~2024~~all without the use of harsh chemicals. This innovative technology is designed to improve water quality and ~~2023~~promote healthier crop growth.

	For the nine Months Ended
	March 31,
	2024			2023			$ Change			% Change
Revenue	$	711,000		$	381,000		$	330,000			86.6	%
Cost of revenue		(41,000	)		(73,000	)		32,000			43.8	%
Gross profit		670,000			308,000			362,000			117.5	%
General and administrative expenses		556,000			872,000			(316,000	)		(36.2	)%
Research and development expenses		45,000			–			45,000			100.0	%
Total operating expenses		601,000			872,000			(271,000	)		(31.1	)%
Income (loss) from operations		69,000			(564,000	)		633,000			112.2	%
Interest expense		(5,000	)		(3,000	)		(2,000	)		66	%
Net income (loss) before and after income taxes	$	64,000		$	(567,000	)	$	631,000			111.3	%

Hacienda Farms, relies heavily on water from Lake Erie, which poses significant water remediation challenges due to issues like algae and bacterial contamination. Additionally, Hacienda Farms has been dealing with high sodium levels in the water, which affect calcium absorption in plants, and fungal issues that harm root health, ultimately reducing crop yields. These water quality challenges necessitate advanced remediation solutions to ensure the sustainability and productivity of their greenhouse operations. Our technology addresses these problems by controlling microorganisms, accelerating vegetative and root growth, and increasing overall plant biomass. This not only improves crop production but also supports sustainable farming practices.

~~Revenue~~17

The ~~Company~~overall ~~generates~~market ~~revenues from the sale of the~~for ~~Nano~~water treatment ~~Reactor® to customers/distributor as well as share~~ in ~~gross~~Canada ~~profit~~is ~~from~~valued ~~the~~at ~~sale~~approximately of$2.51 ~~such~~billion, with ~~reactors~~continuous byexpansion ~~our distributors~~due to ~~their customers. Additionally,~~ the ~~Company~~demand ~~generates~~for ~~revenues~~sustainable ~~from~~solutions in ~~its~~agriculture ~~equity~~and ~~method~~industrial ~~investment~~applications.

16The outcome of the trials mentioned above, which we expect to be completed within the first calendar quarter of 2025, will determine the commercial viability of our product and the timeline for any potential revenue generation.

~~During the nine months ended March 31, 2024, the Company generated $212,000 in revenue from reactor sales~~3. InBusiness ~~addition,~~Venture ~~due to a new Technology License Agreement entered into~~ with ~~our worldwide~~Alchemy ~~limited distributor~~Beverages, ~~the rights to previous advances made to the Company of $498,000 were waived and were recognized as revenue~~ ~~during the current nine month period~~Inc.

~~During~~Over the ~~nine~~past ~~months~~several ~~ended~~years, ~~March~~we ~~31,~~have ~~2023~~worked weclosely ~~recorded~~with Alchemy ~~$381~~Beverages,~~000~~ inInc. ~~revenue,~~(“ABI”) ~~which~~to ~~consisted~~develop ofthe ~~five~~smart ~~purchase~~home ~~orders~~kitchen inappliance ~~the~~Barmuze ~~amount~~and ofalcoholic ~~$361~~beverages. Significant work has been done on Barmuze branding,~~000~~ ~~from~~including ~~Desmet~~launching ~~during~~a new website and creating animations throughout the ~~prior~~year ~~period.~~to ~~In addition,~~showcase how the ~~Company~~appliance ~~recognized~~works. ~~usage~~ABI ~~fees~~is actively pursuing the commercial production of ~~$20~~Barmuze,~~000~~ ~~during~~licensing the ~~prior~~technology ~~period~~to third parties, and considering the opportunity to develop its own alcohol brands, leveraging our cutting-edge technology to transform any alcohol into a smooth, top-shelf experience.

~~Cost~~ABI is in the final stages of ~~Revenue~~completing its financial audit, which is estimated to be completed on or before December 31, 2024, engaging focus groups for Barmuze acceptance, refining marketing and distribution strategies, and securing additional capital for production. The Company also plans on obtaining additional financing in early 2025.

~~During~~The ~~the~~earliest ~~nine~~sales ~~months~~and ~~ended~~revenue ~~March~~for ~~31,~~Barmuze ~~2024 and~~are ~~2023,~~anticipated ~~our~~in ~~cost~~the ofsecond ~~revenue~~half ~~amounted~~of to2025. ~~$41~~Also,~~000~~ ~~and~~ABI ~~$73,000~~is ~~respectively~~working ~~during~~on ~~the~~creating ~~same~~its ~~period~~own inline ~~prior~~of ~~year,~~alcoholic ~~this~~beverages ~~represented~~and ~~the~~licensing ~~cost~~ of the ~~nano reactors sold~~ technology to ~~our~~other ~~distributor~~brands. ~~during~~For ~~each~~more ~~period~~information, aswww.alchemybeveragesinc.com ~~discussed~~and ~~above~~www.barmuze.com.

~~General~~4. ~~and~~New ~~administrative~~Technologies: ~~Expenses~~Hydro-Plasma

~~General~~Along ~~and~~with ~~administrative~~improving ~~expenses~~our ~~was~~existing ~~$556~~technologies,~~000~~ we ~~and~~have ~~$872,000~~developed ~~for the nine months ended March 31~~Hydoplasma, ~~2024,~~an ainnovative ~~decrease~~process ofcombining ~~$308,000~~cavitation orand ~~35.3%~~cold ~~The~~plasma ~~decrease~~technology ~~is primarily due~~ to aenhance ~~decrease~~our ~~in salary~~water ~~expenses~~treatment ~~of $177~~efficiency,~~000, a decrease in stock based compensation of $40,0000 in professional fees of 14,000, a decrease in consulting~~ ~~fees of $44,000 and a decrease in advertising expense of $26,000.~~which:

~~Research~~· Breaks down both organic and ~~development~~inorganic ~~expenses~~compounds. · Is highly scalable – from 15 to 40 GPM. · Eliminates microorganisms and diseases. · Has multiple industrial applications. · The technology is patent pending.

~~Research~~This ~~and~~cutting-edge ~~development~~technology ~~expenses~~creates ~~was~~reactive ~~$45~~agents,~~000~~ ~~and~~such $0as ~~for~~hydroxyl ~~the~~radicals ~~nine~~and ~~months~~hydrogen ~~ended March 31~~peroxide, ~~2024~~that ~~and~~break ~~2023~~down pollutants, ~~respectively~~bacteria, anand ~~increase~~viruses ofin ~~$51,000~~water ormore ~~100~~effectively than traditional methods.~~0%.~~ ~~The~~It’s ~~increase~~an isenvironmentally ~~due~~friendly toand ~~the~~scalable ~~resumption of~~solution, ~~research~~with ~~and~~applications ~~development~~in ~~expenditure~~water ~~for~~treatment, ~~future~~agriculture, ~~product~~sulfur ~~offerings~~removal from bunker fuel, and more.

~~Income~~The global cold plasma market is projected to grow from $1.5 billion in 2021 to $3.1 billion by 2027, fueled by increasing demand for sustainable water solutions. Our technology has the potential to revolutionize water treatment on a global scale. To accelerate this development, we have established partnerships with New Mexico State University, the University of Guadalajara, and the Brackish Groundwater National Desalination Research Facility (~~loss~~BGNDRF), ~~from~~NM, ~~operations~~to collaborate on water remediation programs.

~~Income~~In ~~(loss)~~order ~~from~~to ~~operations~~develop ~~was~~these ~~$69,000~~markets ~~and $(564,000)~~we ~~for~~may ~~the~~need ~~nine months ended March 31~~additional funding, ~~2024~~ and ~~2023,~~may ~~respectively,~~attempt anto ~~increase~~raise ofadditional ~~$633,000~~debt and/or ~~248.9%.~~equity ~~The~~financing ~~increase~~to isfund ~~primarily due~~operations toand ~~the~~additional ~~increase~~working incapital. ~~revenue~~However, there ~~related~~is tono ~~the~~assurance ~~waiver~~that ofwe ~~the~~will ~~previous~~be ~~advances~~successful ~~paid~~in toobtaining ~~the~~such ~~company~~financing byor ~~its~~obtain ~~distributor~~sufficient ~~and~~amounts anecessary ~~reduction~~to ~~in general~~meet ~~and~~our ~~administrative expenses~~business needs, ~~offset~~or bythat anwe ~~increase~~will inbe ~~research~~able into ~~development~~meet ~~expenses,~~our ~~all~~future ~~discussed~~contractual ~~in detail above~~obligations.

~~Interest~~Testing ~~expense~~of the technology is currently underway. Upon a completion of multiple trials, if successful, sales and revenue are anticipated in the first half of 2025.

~~Interest expense was $5,000 and $3,000 for the nine months ended March 31, 2024 and 2023, respectively. This represents interest expense on SBA loans.~~18

~~Net income (loss) before and after income taxes~~Inflation

~~Net~~Global ~~income~~inflation ~~(loss)~~remains ~~before~~a ~~and~~factor ~~after~~in ~~income~~2024/5, ~~taxes~~with ~~was~~interest ~~$64~~rates in the US remaining at higher levels,~~000~~ although there have been some indication from the federal reserve that these rates may decrease, inflationary indicators remain above expectations, delaying any interest rate decreases. The Russia and ~~$(567~~Ukraine and now the Israeli and Hamas conflict and other geopolitical conflicts,~~000)~~ ~~for~~as well as related international response, have exacerbated inflationary pressures, including causing increases in the ~~nine~~price ~~months~~for ~~ended~~goods ~~March~~and 31services and global supply chain disruptions, ~~2024~~which have resulted and may ~~2023~~continue to result in shortages in food products, ~~respectively~~materials and services. Such shortages have resulted and may continue to result in inflationary cost increases for labor, fuel, food products, materials and services, and could continue to cause costs to increase as well as result in ~~income~~the scarcity of ~~$631,000~~certain materials. We cannot predict any future trends in the rate of inflation or ~~111~~other negative economic factors or associated increases in our operating costs and how that may impact our business.~~3%.~~ To the extent we and our customers we service ~~The~~are ~~increase~~unable isto ~~discussed~~recover ~~under~~higher ~~income~~operating ~~(loss)~~costs resulting from inflation or otherwise mitigate the impact of such costs on our and their business, our revenues and gross profit could decrease, and our financial condition and results of operations ~~above~~could be adversely affected.

~~Loss~~Results ~~from~~of ~~equity method investment~~Operations

~~Loss~~Results ~~from~~of ~~equity~~Operations ~~method investment was $0 and $43,000~~ for the ~~nine~~Three ~~months~~Months ~~ended~~Ended ~~March~~September 3130, 2024 ~~and 2023, respectively, a decrease in loss of $43,000. For the nine months ended March~~ ~~31,~~Compared ~~2023, the Company recognized a loss of $43,000~~ to ~~account for its 30% share in~~ the ~~net~~Three ~~loss~~Months ~~from~~Ended ~~the~~September ~~equity method investment. There was no similar loss recognized for the nine months ended March 31~~30, ~~2024 as a result of the impairment of the equity method investment in prior year.~~2023

~~Net~~The ~~income~~following ~~(loss)~~is a comparison of our operation results for the three months ended September 30, 2024 and 2023.

Net income (loss) was $64,000 and $(610,000) for the nine months ended March 31, 2024 and 2023. The increase in income of $674,000 was due to the increase in income discussed under income (loss) from operations above and the decrease in the loss from equity method investment, discussed above.

	For the Three Months Ended
	September 30,
	2024			2023			$ Change			% Change

Revenue	$	–		$	–		$	–			–
Revenue from related party		–			–			–			–
Cost of revenue		–			–			–			–
Gross profit		–			–			–			–

General and administrative expenses		218,000			214,000			4,000			(1.9%	)
Research and development expenses		8,000			36,000			(28,000	)		77.8%
Total operating expenses		226,000			250,000			(24,000	)		(9.6%	)
Loss from operations		(226,000	)		(250,000	)		(24,000	)		(9.6%	)
(Loss) Income from equity method investment		–			–			–			–
Interest expense		(1,000	)		(1,000	)		–			–
Net loss	$	(227,000	)	$	(251,000	)	$	(24,000	)		(9.6%	)

17Revenue

~~Liquidity~~The ~~and~~Company ~~Capital~~generates ~~Resource~~revenues from the sale of the Nano Reactor® to customers/distributor. Additionally, the Company generates revenues from its equity method investment, specifically fees from usage of reactors or usage fees.

~~The~~During ~~Company~~the ~~has~~three ~~not~~months ~~been~~ended ~~generating~~September ~~sufficient revenues~~30, to2024 ~~fund operations~~ and 2023, ~~has~~we ~~been~~recorded ~~dependent~~no ~~on certain of its funding and sales from a technology and marketing agreement with its distributor~~revenues. AsAlthough ~~of March 31, 2024,~~ the Company ~~had~~has aorders ~~working~~for ~~capital~~nano ~~deficit~~reactors offrom ~~$781~~Desmet,~~000~~ ~~and~~none ~~stockholders’~~were ~~deficit~~shipped ofduring ~~855,000. These conditions raises substantial doubt about~~ the ~~Company’s~~current ~~ability to continue as a going concern~~period. ~~In addition, the Company’s~~ ~~independent~~No ~~registered~~usage ~~public~~fees ~~accounting~~were ~~firm,~~recognized induring ~~its report on~~ the ~~Company’s~~current ~~June 30, 2023 financial statements, has expressed substantial doubt about the Company’s ability to continue as a going concern~~period.

As of March 31, 2024 we had cash and cash equivalents on hand of $183,000, We have executed a new agreement with our worldwide limited distributor. Desmet, which resulted in the placement of an order for $652,000 of which $326,000 was paid as a deposit in February 2024, the balance due on completion of the order. The monthly fee from our distributor has been decreased from $40,000 to $25,000 per month after deducting any purchases made during the period of the new agreement. We are uncertain that the new agreement will generate sufficient revenues to sustain the business. In addition, management believes we may require additional funds to continue to operate our business. Management's plan is to generate income from operations by continuing to license our technology globally through our strategic partners, Desmet Belgium (previously Desmet Ballestra Group) (Desmet), Enviro Watertek (EW) and Alchemy Beverages, Inc. (ABI).19

WeCost ~~may~~of also attempt to raise additional debt and/or equity financing to fund operations and provide additional working capital. However, there is no assurance that such financing will be consummated or obtained in sufficient amounts necessary to meet the Company's needs, that the Company will be able to achieve profitable operations or that the Company will be able to meet its future contractual obligations. Should management fail to obtain such financing, the Company may curtail its operations.Revenue

~~Cash~~During ~~Flow~~the three months ended September 30, 2024 and 2023, we recorded no cost of sales as no orders were shipped during the periods considered.

~~Net~~Operating cash generated by operating activities during the nine months ended March 31, 2024 amounted to $165,000 compared to net cash used in operating activities of $131,000 for the comparative period. Funding for the operating activities was provided primarily by the sales of our systems and the deposit of $326,000 paid by Desmet for an order of ten units in terms of the revised Technology license Agreement entered into in February 2024..Expenses

~~Critical~~Operating ~~Accounting~~expenses ~~Policies~~were $218,000 and $214,000 for the three months ended September 30, 2024 and 2023, respectively, an increase of $4,000 or 1.9%.the increase in general and administrative expense are as follows:

~~Use~~· Salaries and wages increased by $19,000 due to the employment of ~~Estimates~~a previous officer of the Company to assist with product development. · Consulting fees increased by $13,000 primarily related to new product and new market developments. · Travel expenses decreased by $16,000 due to a reduction in travel by our officers during the current year, and, · Sub lease income received and offset against rental expense of $13,000 during the current year. A portion of the warehouse was sub-let to a third party.

~~The~~Research ~~preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the U.S requires management to make estimates~~ and ~~assumptions that~~development ~~affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the financial statement date and reported amounts of revenue and~~ expenses during the reporting period. Significant estimates are used for allowance for impairment analysis for property and equipment, accrual of potential liabilities, valuation allowance for deferred tax assets, and assumption in valuing our stock options, warrants, and common stock issued for services, among other items. Actual results could differ from these estimates.

~~Revenue~~Research ~~Recognition~~and development (R&D) expenses was $8,000 and $36,000 for the three months ended September 30, 2024 and 2023, respectively, a decrease of $28,000 or 77.8%. During the prior year, the Company began another R&D project consisting of the design and manufacture of an experimental installation for plasma activation of water by generating a plasma discharge in a water stream. The research and development expenditure is dependent on progress made on the development.

~~The~~Interest Company follows the guidance of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”). ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. Revenue from sale of our Nano Reactors is recognized when products are shipped from our manufacturing facilities as this is our sole performance obligation under these contracts and we have no continuing obligation to the customer. In addition, the Company also recognizes revenues from usage fees of certain reactors. Usage fees are recognized based on actual usage by the customer.expense

~~Recently~~Interest ~~Issued~~expense ~~Accounting~~was ~~Standards~~$1,000 and $1,000 for the three months ended September 30, 2024 and 2023, respectively. Interest expense relates to interest incurred on the SBA loan.

~~See~~Liquidity ~~Note~~and 1Capital ~~of the Condensed Consolidated Financial Statements for a discussion of recently issued accounting standards.~~Resource

18The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in accompanying condensed consolidated financial statements, during the three months ended September 30, 2024, the Company incurred a net loss of $227,000 and had a stockholders’ deficit of $27,074,000 as of September 30, 2024. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s June 30, 2024, financial statements, raised substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments that may result from an inability of the Company to continue as a going concern.

~~ITEM~~As 3of September 30, 2024, the Company has cash in the amount of $2,000. ~~Quantitative~~The ~~and~~Company’s ~~Qualitative~~ability ~~Disclosures~~to ~~about~~continue ~~Market~~as ~~Risk~~a going concern is dependent upon its ability to continue to implement its business plan. Currently, management’s plan is to increase revenues by continuing to license its technology globally. While the Company believes in the viability of its strategy to increase revenues, there can be no assurances to that effect. The Company believes it has enough cash to sustain operations through March 2025.

~~Not~~The ~~applicable~~Company ~~for~~may ~~smaller~~also ~~reporting~~attempt ~~companies~~to raise additional debt and/or equity financing to fund operations and to provide additional working capital. There is no assurance that such financing will be available in the future or obtained in sufficient amounts necessary to meet the Company’s needs, that the Company will be able to achieve profitable operations or that the Company will be able to meet its future contractual obligations. Should management fail to obtain such financing, the Company may curtail its operations.

~~ITEM 4. Controls and Procedures.~~20

~~Evaluation~~Cash ~~of Disclosure Controls and Procedures~~Flow

InNet ~~accordance~~cash ~~with~~used ~~rule 13a-15(a), CTi management must maintain disclosure controls and procedures as defined~~ in ~~Rule~~operating ~~13a-15(e)~~activities ofwas ~~the Securities and Exchange Act of 1934~~$179,000 for or the ~~Exchange Act,~~three tomonths ~~provide~~ended ~~reasonable~~September ~~assurance~~30, ~~that~~2024 ~~information~~and ~~required~~net tocash begenerated ~~disclosed~~ by ~~the~~operating ~~Company~~activities inwas ~~reports~~$122,000 ~~that~~for ~~it files or submits under~~ the ~~Exchange~~three ~~Act~~months isended ~~recorded~~September 30, ~~processed,~~2023. ~~summarized~~Changes ~~and~~in ~~reported~~our ~~within~~cash ~~the~~flows ~~time~~was ~~periods~~due ~~specified~~to changes in ~~the~~operating ~~Securities~~assets and ~~Exchange~~liabilities ~~Commission rules~~as ~~and~~well ~~forms,~~as ~~and~~advances ~~accumulated~~from ~~and~~Desmet. ~~communicated~~During to the period ~~Company's~~ended ~~management~~September 30, ~~including~~2023, ~~its~~the ~~principal~~Company ~~executive~~received ~~officer~~advances ~~and~~from ~~principal financial~~Desmet ~~officer~~of $304,000 ascompared ~~appropriate~~ to ~~allow~~none ~~timely~~during ~~decisions~~the ~~regarding~~period ~~required~~ended ~~disclosure~~September 30, 2024.

InCritical ~~accordance~~Accounting with Rule 13a-15(b) and (c), management must also evaluate the effectiveness of these disclosure control and procedures at the end of each fiscal year. As of March 31, 2024 the Company carried out an evaluation, under the supervision and with the participation of its principal executive officer and principal financial officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based upon that evaluation, the Company's principal executive officer and principal financial officer concluded that these disclosure controls and procedures were not effective as of March 31, 2024.Policies

~~Changes~~Use inof ~~Internal Control over Financial Reporting~~Estimates

~~There~~The ~~were~~preparation noof ~~changes~~the consolidated financial statements in ~~internal~~conformity ~~control~~with ~~over~~accounting principles generally accepted in the U.S requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the financial ~~reporting~~statement date and reported amounts of revenue and expenses during the ~~third~~reporting ~~quarter~~period. Significant estimates are used for allowance for impairment analysis for property and equipment, accrual of ~~fiscal~~potential ~~2024~~liabilities, ~~that~~valuation ~~have~~allowance ~~materially~~for ~~affected~~deferred ortax ~~are~~assets, ~~reasonably~~and ~~likely~~assumption toin ~~materially~~valuing ~~affect~~our stock ~~the~~options, ~~company's~~warrants, ~~internal~~and ~~control~~common ~~over~~stock ~~financial~~issued ~~reporting~~for services, among other items. Actual results could differ from these estimates.

19Revenue Recognition

~~PART~~The IICompany follows the guidance of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”). ASC 606 creates a five-step ~~OTHER~~model ~~INFORMATION~~that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. Revenue from sale of our Nano Reactors is recognized when products are shipped from our manufacturing facilities as this is our sole performance obligation under these contracts and we have no continuing obligation to the customer. In addition, the Company also recognizes revenues from usage fees of certain reactors. Usage fees are recognized based on actual usage by the customer.

Recently Issued Accounting Standards

See Note 1 of the Condensed Consolidated Financial Statements for a discussion of recently issued accounting standards.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not applicable for smaller reporting companies.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

In accordance with rule 13a-15(a), CTi management must maintain disclosure controls and procedures as defined in Rule 13a-15(e) of the Securities and Exchange Act of 1934, or the Exchange Act, to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and accumulated and communicated to the Company's management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

In accordance with Rule 13a-15(b) and (c), management must also evaluate the effectiveness of these disclosure control and procedures at the end of each fiscal year. As of September 30, 2024 the Company carried out an evaluation, under the supervision and with the participation of its principal executive officer and principal financial officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based upon that evaluation, the Company's principal executive officer and principal financial officer concluded that these disclosure controls and procedures were not effective as of September 30, 2024.

Changes in Internal Control over Financial Reporting

There were no changes in internal control over financial reporting during the first quarter of fiscal 2025 that have materially affected or are reasonably likely to materially affect the company's internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We know of no material, existing or pending legal proceeding against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

During the quarter ended ~~March 31~~September 30, 2024, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 ~~trading~~ trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

2022

Item 6. Exhibits, Financial Statement Schedules.

			Incorporated by Reference
Exhibit		Filed
Number	Exhibit Description	Herewith	Form	Pd. Ending	Exhibit	Filing Date

3(i)(a)	Articles of Incorporation - original name of Bioenergy, Inc.		SB-2	N/A	3.1	October 19, 2006
3(i)(b)	Articles of Incorporation - Amended and Restated		10-Q	December 31, 2008	3-1	February 17, 2009
3(i)(c)	Articles of Incorporation - Amended and Restated		10-Q	June 30, 2009	3-1	May 14, 2009
3(i)(d)	Articles of Incorporation - Amended; increase in authorized shares		8-K	N/A	N/A	October 29, 2009
3(i)(e)	Articles of Incorporation - Certificate of Amendment; forward split		10-Q	December 31, 2009	3-1	November 16, 2009
10.1	Patent Assignment Agreement between the Company and Roman Gordon dated July 1, 2008		8-K	June 30, 2009	10.1	May 18, 2010
10.2	Patent Assignment Agreement between the Company and Igor Gorodnitsky dated July 1, 2008		8-K	June 30, 2009	10.2	May 18, 2010
10.3	Assignment of Patent Assignment Agreement between the Company and Roman Gordon		8-K	June 30, 2009	10.3	May 18, 2010
10.4	Assignment of Patent Assignment Agreement between the Company and Igor Gorodnitsky		8-K	June 30, 2009	10.4	May 18, 2010
10.5	Employment Agreement between the Company and Roman Gordon date March 17, 2008		10K/A	June 30, 2009	10.3	October 20, 2011
10.6	Employment Agreement between the Company and Igor Gorodnitsky dated March 17, 2008		10K/A	June 30, 2009	10.4	October 20, 2011
10.7	Employment and Confidentiality and Invention Assignment Agreement between the Company and Varvara Grichko dated April 30, 2008		10-Q	December 31, 2010	10.3	February 11, 2011
10.8	Board of Director Agreement - James Fuller		10-Q	December 31, 2011	10.12	October 20, 2011
10.9	Technology and License Agreement with Desmet Ballestra dated 14 May 2012		10-K	June 30, 2012	10.1	October 15, 2012
10.10	Short Term Loan Agreement - CEO		10-K	June 30, 2012	10.11	October 15, 2012
10.11	Loan Agreement - Desmet Ballestra - Oct. 26, 2010
14.1	Code of Business Conduct and Ethics*		10-K	June 30, 2011	14.1	September 28, 2011
31.1	Certificate of Principal Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002	X
31.2	Certificate of Principal Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002	X
32.1	Certification of Principal Executive Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X
32.2	Certification of Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X

101.INS	Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)	X
101.SCH	Inline XBRL Taxonomy Extension Schema Document	X
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document	X
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document	X
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document	X
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document	X
104	Cover Page Interactive Data File (formatted in inline XBRL, and included in exhibit 101)

* In accordance with Regulation S-K 406 of the Securities Act of 1934, we undertake to provide to any person without charge, upon request, a copy of our “Code of Business Conduct and Ethics”. A copy may be requested by sending an email to info@cavitationtechnologies.com.

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SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF THE REGISTRANT AND IN THE CAPACITIES AND ON THE DATES INDICATED

SIGNATURE	TITLE	DATE
/s/ N. Voloshin	President; Member of Board of Directors	~~May~~November 1514, 2024
N. Voloshin	(Principal Executive Officer)
/s/ N. Voloshin	Chief Financial Officer	~~May~~November 1514, 2024
N. Voloshin	(Principal Financial Officer)

2224

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