United States Securities and Exchange
Commission
Washington, DC
20549-0306
Division of Corporate
Finance
Mail Stop 3561
|
Re:
|
Cavitation Technologies,
Inc.
Form 10-K for Fiscal Year Ended
June 30, 2009
Forms 10-Q for the Quarterly
Periods Ended September 30, 2009 and December 31,
2009
|
Registration Statement File No.
0-29901
July 30, 2010
Ladies
and Gentlemen,
This
letter is in response to your supplemental comment letter dated June 14, 2010.
Our responses to your letter are as follows below. Changes from our
original response are marked
Item 1-
Business, page 2
Introduction,
page 2
Comment 1 (previously comment
1)
The installation of the unit in the
Moberly, Missouri plant was accomplished through the sale of our unit to SRS
Engineering, Inc. pursuant to a standard purchase order. We have
received a $26,000 deposit from SRS Engineering, Inc. but have not yet received
the balance payment due and accordingly, are unable to book the placement of the
unit as revenue. We feel that filing the purchase order which reflects the full
purchase amount of the Bioforce 9000 would be misleading, accordingly, we will
not be filing this purchase order as an exhibit.
FOR
INFORMATION ONLY: We feel that the contract is not a material contract and
accordingly, should not be filed because (i) it does not meet the GAAP
definition of a “sale” because there was not a reasonable expectation of
collection due to failure of a third party to provide components of the plant
and (ii) we do not believe that a buyer or seller of the Company’s securities
would consider a purchase order and a deposit of $26,000 to be a “material
fact” in making their decision to buy or sell our securities.
Comments 2, 3, 4, 5 & 6 (previously comments 2
and 3)
We have made the following changes to
our 10K introduction in order to make the disclosure complicit with the
requirements of Items 101(h)(4)(i), 101(h)(4)(iv), 101(h)(4)(vii), 101(h)(4)(x)
and 101(h)(4)(xi) of Regulation SK.
Introduction
Hydrodynamic
Technology, Inc., or the ("Company") was incorporated 29 January 2007 as a
California corporation. It is a wholly owned operating subsidiary of
Cavitation Technologies, Inc., a Nevada corporation, and the parent company. The
Company designs and engineers environmentally friendly NANO technology based
systems. These systems have potential commercial applications in markets
such as vegetable oil refining, renewable fuels, water recycling, water-oil
emulsions, alcoholic beverage enhancement, extraction of algae, and crude oil
yield enhancement. Our investment in R&D since inception on
January 27, 2009 through June 30, 2009 is $2,438,498.
R&D
has led to products which include the Green D+Plus” System – a vegetable oil
refining system, and the “Bioforce 9000 Skid System” which performs the
transesterification process during the production of biodiesel. Both the Bioforce 9000
and the Green D+ Plus
Systems use our
unique patents pending, continuous flow-through, hydrodynamic NANO Technology in the form of,
multi-stage cavitation reactors. Our technology process creates small particles
in some cases smaller than one micron (nano particles) and bonds these particles
at the molecular level. These reactors have no moving parts and are scalable to
high volumes. To date the Company has sold no products and has
received no revenue from product sales.
Vegetable
Oil Refining
Our
Green
D+
Plus System
uses a patent pending NANO Cavitation Process that
is designed to convert crude non-degummed vegetable oils into high quality
de-gummed oils at lower costs and higher yields. Our Green D+ Plus System is
designed to be used in the vegetable oil refining process to increase the
efficiency in separating vegetable oils from impurities
(gums). During the refining process, there is a certain volume of oil
that is lost and trapped in gums. Oil trapped in gums reduces the
yield. That is, the efficiency or yield of the refining process is
measured by minimizing oil loss. Our Green D+ Plus System is
designed to improve the efficiency of the process by reducing the amount of oil
that is lost or remains trapped in gums.
A
means for detecting the percentage of oil present in gums is the Acetone
Insoluble (AI) test. The industry average AI reading is 70%. The
higher the AI reading, the lower the amount of oil trapped in gums, and
therefore the higher the yield. As yield increases, profitability for the
refiner increases. Our system is designed to improve yield leading to
increased profitability for refiners.
During
July and September 2009, Cavitation Technologies, Inc. conducted a number of
tests at our Chatsworth, California facility using a commercial scale, (not a
small-scale or lab bench test unit) flow-through Green D + Plus System with a
daily capability of 200 tons of oil. The batch volumes ranged from 20
to 40 liters at a time. Oil samples were sent to Mid Continent
Laboratories (Memphis, Tennessee) an independent lab certified by the American
Oil Chemists Society (AOCS). The oil samples were analyzed by Mid
Continent before and after treatment. Mid Continent conducted the
analysis in accordance with AOCS official method Ja 4-46 for measuring
AI. Results show better than industry average AI readings which
indicate that our Green D+ Plus System is able to
produce a yield higher than the industry average. The higher yield/less oil loss
is due to a reduction in the consumption of degumming reagents. So
not only does yield improve but costs are reduced as well.
This
system is scheduled for operational testing during 2010. Following successful
testing, we expect to bring the Green D+Plus to market in the latter
half of 2010.
The
global target market for our Green
D+
Plus
System includes approximately 7,000 worldwide vegetable oil de-gumming
processors. The global demand for processed vegetable oils has grown
consistently over the past five years from 118 million metric tons in 2005/6 to
about 133 million metric tons in 2008/09. We believe there will continue to be
growing demand for technology that processes vegetable oils at lower costs
and/or higher yields. To date the Company has
sold no products and recognized no revenue.
FOR
INFORMATION ONLY. The following information will appear in our 10-K
for the period ending 30 June 2010.
“We
intend to license our technology/systems globally through a distribution network
of strategic partners who are recognized leaders in their field and who design,
build, install and recommend our systems. On January 15, 2010 the Company signed
a worldwide license and distribution agreement with the Desmet Ballestra Group
(DBG) for marketing the Company’s Green D+
Plus Systems. Working with DBG, we
plan to conduct pilot tests at up to 5 commercial vegetable oil refineries
during 2010. In June 2010 we completed a pilot test of our 200 ton/day Green
D+Plus at a commercial vegetable oil refining plant in South
Carolina. Results met expectations as operating costs were reduced as the use of
acid (used in the competitive process) was eliminated with our process. We also
signed a memorandum of understanding with another vegetable oil refining plant
located in Minnesota for pilot testing of another 200 ton/day pilot system. Test
results should be known by September 2010. Results from all pilot tests are
expected to be known by October 1, 2010. If the cumulative results from our
pilot tests are similar to those achieved in South Carolina, then we expect to
be able to compete with well-known companies that supply older, less efficient
technology and equipment. We expect to generate revenue within 12 months of
satisfactorily completing these pilot tests.”
Biodiesel
Our
fully automated Bioforce 9000
NANO Reactor Skid System performs the transesterification process during
the production of biodiesel; that is, it fully converts all mono-, di-, and
tri-glycerides contained in feedstock (such as animal fats and vegetable oils)
into methyl esters (crude biodiesel). We believe the Bioforce 9000 offers
potential advantages including the ability to use multiple feedstock s with
up to 3% (free fatty acids) simultaneously.
The
first commercial installation
of our Bioforce 9000
is included in a new biodiesel production plant that is expected to be
fully operational before the end of 2009 in Moberly, Missouri. In
conjunction with this installation, we received a $26,000 down-payment from a
client who cited a number of advantages of the Bioforce 9000 including
“consumes far less energy”. The total energy (electricity and steam) required to
produce a gallon of industry standard biodiesel using competitive technology
ranges from $0.02/gal. to $0.05/gal., depending on production capacity,
feedstock, and other factors. Our Bioforce 9000 Skid System
applies only to the transesterification portion of the biodiesel production
process. Assuming that competitive transesterification processes account for
between 20%-50% of the total energy required to produce industry standard
biodiesel, the energy consumed by a competitive transesterification process
would range from $0.004 to $0.01 to produce one gallon of biodiesel. Our testing
suggests that our 24GPM Bioforce 9000 uses as little
as $0.0008 for each gallon of biodiesel produced based on
14kWh.
Our
system can reduce costs in other ways. Normally feedstocks with up to 3% FFA
(free fatty acid) need to be pre-treated, or esterified with sulfuric acid in
order to reduce the FFA level to about 0.1%. This incurs extra
expense. With our system, this process may be eliminated. Another
characteristic of our system is the minimal reaction time. Competitive processes
require 2-stage reactions using chemicals over a period of 1-2 hours. Our
process occurs almost instantaneously. In addition, our system weighs only about
1,500 lbs and has a footprint of 24 sq. ft. which helps reduce capital
costs.
With
regard to quality lab reports issued by independent third parties including the
State of Missouri Agriculture Department confirmed that biodiesel produced using
the Bioforce 9000 met
or exceeded industry quality (ASTM 6751) standards. Our client who is involved
in the installation of the Bioforce 9000 at the Moberly
biodiesel production facility commented that our system produces “high yield of
high quality biodiesel”.
The
global demand for petroleum-based diesel is about 345 billion gallons/year. We
have been impacted by the downturn in the worldwide economy and the slowdown in
the demand for biodiesel. Uncertainty in the biodiesel industry has negatively
affected our business. The biodiesel industry has also been
negatively impacted by the failure of Congress to renew the $1/gallon excise tax
credit. Factors which can spur the demand for biodiesel and our products include
legislation which mandates increased use of biodiesel, a reduction in the
cost of raw materials (feedstock) used in the production of biodiesel, and an
increase in the price of competitive products such as petroleum-based diesel
fuel. These adverse economic conditions may continue to negatively affect our
revenues and profitability over the near term. Nevertheless, we
intend to lease and license our technology/systems through a global distribution
network of strategic partners who are recognized leaders in their field and who
design, build, install and recommend our systems.
To
date the company has sold no product and has recorded no revenue other than
$26,000 recorded as Deferred Income on our balance sheet. This amount represents
a down payment for a Bioforce
9000 System sold. A balance of $52,163 remains outstanding
with payment date uncertain.
We
have a variety of competitors, large and small. There are a number of
competitors in the biodiesel industry, and there is at least one other company
which professes to offer hydrodynamic cavitation technology. Other companies use
rotor-stator and ultrasonic cavitation technologies. Competitors in the edible
oil refining industry include well-known companies.
We
differentiate ourselves by the designs, processes, and applications described in
our patents pending applications. We compete by offering solutions that we
believe can reduce operating expenses vis-à-vis current technology. Independent
laboratory tests indicate that our degumming technology is able to produce a
higher yield than competitive technologies due to less oil loss and a smaller
consumption of the degumming reagents.
Due to the nature of our products, we
have incurred no costs with respect to environmental
compliance.
Our
success will depend in part on our ability to obtain patents, maintain trade
secrets, and operate without infringing on the proprietary rights of
others both in the United States and other countries. We have seven
patent applications pending in and have applied for three international patents
which apply to our reactors, systems, and processes. US utility patents directed
to various cavitation devices and/or processing methods as well
as three PCT applications . We plan to continue to
apply for new and improved patents on a regular basis. Our patents
pending apply to potential commercial applications in markets such as vegetable
oil refining, renewable fuels production, waste water treatment, water-oil
emulsions, crude oil yield enhancement, and alcoholic beverage
enhancement.
There can be no assurances that patents
issued to the Company will not be challenged, invalidated, or circumvented, or
that the rights granted hereunder will provide proprietary protection or
competitive advantage to the Company.
FOR
INFORMATION ONLY. The following information will appear in our 10-K
for the period ending 30 June 2010. “During
the period related to this filing, the Company had no approved
patents. On 19 May 2010, the USPTO allowed the patent for our
“Cavitation Generator” (US Patent Application No.
12/395,110).
We are a
public company with stock traded on the Over the Counter Bulletin Board with
ticker symbol CVAT. Our stock is also traded on the Berlin and
Stuttgart Stock Exchanges with the symbol WTC. Our single location is
our headquarters in Chatsworth, CA. We have four employees and have engaged
approximately 40 consultants and independent contractors over the past two
years.
Comments
4 and 5 are also responded to with the attached lab report
PDF’s
Comment 7 (previous comment
6)
Unregistered
Sales of Equity Securities and Use of Proceeds, page 5
We
have amended our disclosure to reflect that all the securities sold were sold in
reliance on Section 4(2) of the Securities Act of 1933, as amended, and that the
Hydro Dynamic shares sold on October 3, 2010 were
sold to fewer than 5 accredited investors, each of whom had a pre-existing
relationship with the Company.
With
respect to the shares issued on March 17, 2009, those shares were sold to an
existing accredited investor of the Company’s securities who had previously
purchased shares of Series A-1 Preferred Stock of Hydrodynamic
Technology.
With
respect to the April 22, 2009 and June 2009, issuance, those shares and warrants
were sold to service providers of the Company as well as to existing accredited
investors who desired to make an additional investment in the
Company.
The specific language is as
follows:
“On
October 3, 2008, the Company issued 210,000 units comprised of five shares of
its Series A-1 Preferred Stock (total of 1,050,000 preferred shares) and one
warrant to purchase one share of common stock at $0.75 per share for total
proceeds of $525,000 which were placed in escrow. Upon the closing of escrow on
October 3, 2008, $400,000 was used to purchase 50.5% of the outstanding shares
of Bio (see Note 2 to the consolidated financial statements), and the remaining
$125,000 was distributed to the Company. The shares of Company stock were sold
in compliance with Section 4(2) of the Securities Act of 1933, as amended to
less than 5 accredited investors who had a pre-existing relationship with the
Company’s management.
On
October 24, 2008, the Company entered into a share exchange agreement with Bio
in which Bio acquired all of the outstanding shares of the Company’s
stockholders. Bio Energy, Inc. issued 18,750,000 shares of its common stock to
the stockholders of Hydrodynamic Technology, Inc. in exchange for all the
outstanding shares of Hydrodynamic Technology, Inc. Under the terms of the
share exchange agreement, Bio performed a 7.5-to-1 forward stock split of its
outstanding shares of common stock.
On
October 24, 2008, in connection with the reverse merger, all shares of Series
A-1 Preferred Stock were converted to common shares of Bio. The accompanying
financial statements have retroactively shown the recapitalization for all
periods presented. As a result of the merger with Bio, the Company no longer has
any Series A-1 Preferred Stock authorized or issued. In connection with the Bio
transaction, 410,000 warrants to purchase 410,000 shares of Common Stock of
Hydro converted into 279,800 warrants to purchase 279,800 shares of Common Stock
of Bio.
On March
17, 2009, the Company filed Amended and Restated Articles of Incorporation,
which authorized the Company to issue up to 100,000,000 shares of Common Stock
and 10,000,000 shares of Preferred Stock, of which 5,000,000 shares are
designated as Series A Preferred Stock and 5,000,000 shares are designated
Series B Preferred Stock, with the rights, preferences and privileges of the
Series B Preferred Stock to be designated by the Board of
Directors. Each share of Common Stock and Preferred Stock has a par
value of $0.001.
On March
17, 2009 the Company issued 111,111 shares of Series A Convertible Preferred
Stock at a purchase price of $0.90/share, which was equal to the closing price
of the Company’s Common Stock on the business day immediately preceding the
purchase by the Subscriber. The preferred stock was issued to a foreign
accredited investor for a purchase price of $100,000. Each share of
Series A Preferred Stock is convertible at the owner’s option into 1.125 shares
of common stock. The preferred shares are convertible into shares of
Common Stock of the Company at any time at the election of the holder but will
automatically convert to Common Stock on March 17, 2012. The shares were issued
to an existing investor of the Company’s securities who had previously purchased
shares of the Series A-1 Preferred Stock of Hydro Dynamic Technology,
Inc.
On
April 22, 2009, the Company issued 166,666 shares of common stock at $0.60 per
share and 66,666 warrants to purchase 66,666 shares of Common Stock at an
exercise price of $1.50 per share for a total consideration of
$100,000. The shares and warrants were issued to service providers of
the Company as well as to existing accredited shareholders who desired to make
an additional investment in the Company. The warrants vest
immediately and have a contractual life of 3 years. The total value of the
warrants issued amounted to $0. The value was determined using the
Black-Scholes valuation model with input assumptions of (1) volatility of 64%,
(2) expected life of 1.5 years, (3) risk free rate of 0.76%, and (4) expected
dividends of zero.
In
summary, for fiscal 2009 we issued 661,303 shares of common stock valued at
$639,673 to service providers who provided advertising and marketing
services. We also received $300,000 in cash in exchange for 533,332
common shares. In fiscal 2009, we also issued 111,111 preferred shares for
$100,000. In 2008, we issued 3,456,550 shares of common stock
valued at $1,823,400 to service providers who supported our research and
development activities. In fiscal 2008, we also issued 1,000,000
shares of preferred stock for $500,000. Further, for
fiscal 2009, we issued warrants to purchase 1,374,421 shares of Common Stock
with exercise prices ranging from $0.60 to $1.75 per share. The
warrants vest immediately and have a contractual life ranging from 1.5 to 5
years. The total value of the warrants issued amounted to
$303,123. The value was determined using the Black-Scholes valuation
model with input assumptions of (1) volatility of 64% - 148%, (2) expected life
ranging from 1.5 to 2.5 years, (3) risk free rate ranging from 0.85% to 1.55%,
and (4) expected dividends of zero.”
Note - we have
amended our response to your previous comment 7 from your April 2, 2010
comment letter to read as follows:
Item
8. Financial Statements and Supplementary Data, Page
10.
Consolidated
Statements of Changes in Stockholders’ Deficit, page 14
Comment 7 (previous comment
6)
We
have provided all the information required by paragraph 11(d) of SFAS 7 for each
issuance of stock, warrants, rights, or other equity securities, as applicable
in the interim report filed with the SEC on May 17, 2010 on Form 10Q, and
we will provide the same information in all of our prospective
filings.
Note 2-
Basis of Presentation and Going Concern, page 16
Basis of
Presentation, page 16.
Comment 8 (previous comment
10)
There
were no other shares cancelled in addition to the 1,262,500 pre-split shares,
which are excluded from the total issued and outstanding shares as of June 30,
2009
Comment
9 (previous comment 5)
Note 8-
Stockholders Equity, page 21
We have
amended the disclosure on page 22 to clarify that the Registrant has no formal
stock option plans and has assumed the stock options issued by its wholly owned
subsidiary at the time of the share exchange. The specific language is as
follows:
“While
the Company has no formal stock option plan, it had assumed the outstanding
options of its wholly owned subsidiary, Hydro-Dynamic Technology, Inc. Those
options have been granted to employees, directors, consultants and independent
contractors of the Company and its wholly owned subsidiary. The Company believes
that such awards encourage employees to remain employed by the Company and also
to attract persons of exceptional ability to become employees of the
Company. The Company has no ability at this time to grant any stock
options pursuant to a stock option plan, as there is no plan in
effect. The Company may grant non plan stock options but has not done
so at this time nor does it have any current plans to do so.”
Comment
10 (previous comment 18)
The
Company is in the process of adopting a code of ethics and anticipates
completing such adoption before filing our next 10-K for the period ending 30
June 2010. The Company has not previously adopted the code of ethics due to
financial and personnel constraints which required the Company to focus on its
business operations.
Item 11
Executive Compensation, page 30.
Comments
11, 12, 13 (previously comment 19)
|
Summary
Compensation Table
|
|||||||||||||||||||||||||||||
|
Non-Equity
|
All
|
||||||||||||||||||||||||||||
|
Stock
|
Option
|
Incentive
Plan
|
Other
|
||||||||||||||||||||||||||
|
Year
|
Salary
|
Bonus
|
Awards
(1)
|
Awards
(1)
|
Compensation
|
Compensation
|
Totals
|
||||||||||||||||||||||
|
Roman
Gordon
|
2009
|
$ | 172,856 | $ | - | $ | - | (2) | $ | - | (3) | $ | - | $ | - | $ | 172,856 | ||||||||||||
| Chief Executive |
2008
|
$ | 50,034 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 50,034 | ||||||||||||||
| Officer |
2007
|
- | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||
|
Igor Gorodnitsky
(1)
|
2009
|
$ | 224,542 | (5) | $ | - | $ | - | (6) | $ | - | $ | - | $ | - | $ | 224,542 | ||||||||||||
|
President
|
2008
|
$ | 28,000 | (5) | $ | - | $ | - | (6) | $ | - | $ | - | $ | - | $ | 28,000 | ||||||||||||
|
2007
|
- | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||||
|
R.L.
Harrtshorn
|
|||||||||||||||||||||||||||||
| Chief Financial |
2009
|
- | $ | - | $ | 93,975 | $ | 39,780 | $ | - | $ | - | $ | 133,755 | |||||||||||||||
| Officer |
2008
|
- | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||
|
2007
|
- | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||||
(1) Includes accrued salary of
$224,542 and $28,000 as of June 30, 2009 and 2008,
respectively.
The
following table sets forth certain information regarding options granted to the
named executive officers during the fiscal year ended June 30,
2009:
|
Outstanding Equity Awards at June
30, 2009 Option/Warrant
Awards
|
||||||||||||||||||
|
Grant Date
|
Number of
Securities
Underlying
Unexercised
Options (#)
(exercisable)
|
Equity
Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
(unexercisable)
|
Equity
Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
|
Option/
Warrant
Exercise
Price ($)
|
Option/
Warrant
Expiration
Date
|
|||||||||||||
|
R.L. Hartshorn,
CFO
|
7/21/2008
|
23,885 | - | - | $ | 1.000 |
8/31/2016
|
|||||||||||
|
R.L. Hartshorn,
CFO
|
7/21/2008
|
68,244 | - | - | $ | 2.000 |
8/31/2016
|
|||||||||||
There
were no shares of stock that have not vested or any shares of stock, units or
other rights awarded under any equity incentive plan that have not vested as of
June 30, 2009.
Directors’
Compenstion
|
Name
and Principal Position
|
Year
|
Fee
earned or paid in cash
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-equity
Incentive
Plan
Compensation
($)
|
Change
in
Pension
value and
Nonqualified
Compensation
Earnings
($)
|
All
other
Compensation
($)
|
Total
($)
|
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
|
|
Roman
Gordon
Chief
Executive
Officer
|
2007
2008
2009
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
|
Igor
Gordonitsky
President
|
2007
2008
2009
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
|
R.L
Hartshorn
Chief
Financial
Officer
|
2007
2008
2009
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
Retirement
or Change of Control Arrangements
We do not
offer retirement benefit plans to our executive officers, nor have we entered
into any contract, agreement, plan or arrangement, whether written or unwritten,
that provides for payments to a named executive officer at or in connection with
the resignation, retirement or other termination of a named executive officer,
or a change in control of the company or a change in the named executive
officer's responsibilities following a change in control.
Compensation
of Directors
We do not
have any standard arrangement for compensation of our directors for any services
provided as director; including services for committee participation or for
special assignments
Exhibits
Comment
14 (previously Comment 22)
We have
amended our 10-K filing to include the following items:
3.1
Amendment to Certificate of Incorporation (Incorporated by reference to the
Company’s current report on Form 8-K, as filed with the Securities
and Exchange Commission on October 14, 2008)
3.1 Bylaws
(Incorporated by reference to the Company’s SB-2 as filed with the Securities
and Exchange Commission on October 19, 2006.
10.1
Share Exchange Agreement dated October 22, 2008 by and among Cavitation
Technologies, Inc. and the shareholders of HydroDynamic Technology, Inc.
(incorporated by reference to the Company’s current report on Form 8-K, as filed
with the Securities and Exchange Commission on October 24, 2008).
Form 10-Q for the Quarterly
Period Ended December 31, 2009
Item 2 Management’s
discussion and analysis of financial condition and results of operations, page
6.
Part
II
Item 2-
Unregistered Sales of Equity Securities
Comment
15 (previously Comment 26)
We
will amend the 10-Q filing to indicate the shares were sold in reliance on
Section 4(2) and were issued to both existing accredited investors as well as
accredited individuals who had previously existing relationships with Company
management.
Form 10-Q for the Period Ended March 31,
2010
Comment 26
All
shares were issued in reliance on Section 4(2) of the Securities Act of
1933. The shares were sold to a limited number of accredited
investors who had a pre-existing relationship with the Company and/or were
previous investors in the Company
|
CAVITATION TECHNOLOGIES,
INC.
|
|
| By: s/Roman Gordon/ | |
| Chief Executive Officer |
