BLUE BIOFUELS INC

The Company’s board of directors has a compensation committee consisting entirely of independent directors, with Peter Zimeri as chair and Edmund Burke and Charles Sills as the other members. The Company’s compensation philosophy is based on its belief that its compensation programs should be aligned with stockholders’ interests and business objectives; reward performance; and be externally competitive and internally equitable. The Company seeks to achieve three objectives, which serve as guidelines in making compensation decisions:

The Company may compensate its officers with cash compensation, common stock and common stock options. The Company has not established any quantifiable criteria with respect to the level of compensation, stock grants or options. Rather, the Board of Directors and its compensation committee will evaluate cash, stock grants and stock options paid to executives in similarly situated companies.

With respect to stock grants and options which may be issued to the Company’s officers and directors, the Board and its compensation committee will consider an overall compensation package that includes both cash and stock-based compensation which would be in line with the Company’s overall operations and compensation levels paid to similarly situated companies. Under the Company’s 2012 Employee, Director Stock Plan, the administrator can provide for the grant of non-qualified stock options (“Non-Qualified Stock Options”), incentive stock options (“ISOs”, together with Non-Qualified Stock Options referred to herein as “Stock Options”), stock appreciation rights (“SARs”), restricted stock (“Restricted Stock”) and registered stock (“Registered Stock”), (collectively, the “Awards”) to eligible Participants.

As of the date of this filing, the Company has two executives.

Commencing on January 1, 2021, Ben Slager, CEO, has an employment contract to receive a salary of $360,000 per annum, along with health insurance. Various bonuses are offered based on performance and may be accrued, at his discretion, if the Company doesn’t have the funds to pay them. He has not received any salary or bonuses due since Q3 2023. Unpaid salaries are accruing interest at the rate of 10% per annum. In February 2024, his salary was increased due to inflation and higher cost of living to $525,000, all of it being accrued and unpaid, at his discretion, which is expected to be paid when the Company raises significant capital to fund its future. His employment contract indicates that he must be given 6-months’ notice of termination, and shall receive a severance package of one-month’s pay in addition to the 6-months’ notice, or 3 months’ salary if he dies. If there is a change of control, all his options shall vest.

As of December 31, 2023, Ben Slager is owed $391,538 in back pay and accrued bonuses, along with interest of $3225.

Commencing January 1, 2021, Anthony Santelli, CFO, has an employment contract to receive a salary of $250,000 per annum, and may not be terminated until all his back pay due is paid. Various bonuses are offered based on performance and may be accrued, at his discretion, if the Company doesn’t have the funds to pay them. He has not received any salary or bonuses due since Q3 2023. Unpaid salaries are accruing interest at the rate of 10% per annum. In February 2024, his salary was increased due to inflation and higher cost of living to $325,000, all of it being accrued and unpaid, at his discretion, which is expected to be paid when the Company raises significant capital to fund its future. In addition, the CFO must be given 6-months’ notice of termination and shall receive a severance package of one-month’s pay in addition to the 6-months’ notice, or 3 months’ salary if he dies. If there is a change of control, all his options shall vest.

As of December 31, 2023, Anthony Santelli is owed $293,830 in back pay and accrued bonuses, along with interest of $62,047.

As of December 31, 2023, AES Financial Advisors, LLC, an entity owned by Anthony Santelli II and his wife Marjorie Santelli, Esq., is owed $72,670, primarily dating from 2018, prior to when Dr. Santelli became COO, plus interest of $18,419.

The following tables set forth the compensation paid by the Company to its officers and directors for the fiscal years ended December 31, 2023, and December 31, 2022. This information includes the dollar value of base salaries, bonus awards and number of stock options granted, and certain other compensation, if any, actually paid. Accrued back pay is included in Other in the year in which it is actually paid. Unvested but granted stock options are included in the year in which they vest. The compensation discussed addresses all compensation awarded to or paid to its named executive officers.

OUTSTANDING EQUITY AWARDS

Grants of Plan-Based Awards

Warrants Issued to Management

Grants of Plan-Based Awards

Outstanding Equity Awards at Fiscal Year End

In March 2023, the company’s Chief Executive Officer Ben Slager received options to purchase up to 6,000,000 shares of the Company’s common stock under the Company’s 2021 Employee Director Stock Plan at an exercise price of 20 cents per share that will vest if and when the company is uplisted to the Nasdaq or NYSE. Using a Black-Scholes option pricing model, these were valued at $1,015,146. In January 2021, the company’s Chief Executive Officer Ben Slager received options to purchase up to 6,000,000 shares of the Company’s common stock at an exercise price of 15 cents per share that vested January 1, 2022. Using a Black-Scholes option pricing model, these were valued at $743,298. In the year ended December 31, 2020, the Company’s Chief Executive Officer received options to purchase up to 10,000,000 shares of the company’s common stock under the Company’s 2012 Employee Director Stock Plan at an exercise price of 10 cents per share, half that vested immediately, and half that vest upon the commercialization of the CTS process. Using a Black-Scholes asset pricing model, the vested options were valued at $414,850.

In March 2023, the company’s Chief Financial Officer Anthony Santelli received options to purchase up to 4,000,000 shares of the Company’s common stock under the Company’s 2021 Employee Director Stock Plan at an exercise price of 20 cents per share that will vest if and when the company is uplisted to the Nasdaq or NYSE. Using a Black-Scholes option pricing model, these were valued at $676,764. In January 2021, the company’s Chief Financial Officer Anthony Santelli received options to purchase up to 4,000,000 shares of the Company’s common stock under the Company’s 2012 Employee Director Stock Plan at an exercise price of 15 cents per share that vested on January 1, 2022. Using a Black-Scholes option pricing model, these were valued at $495,532. In the year ended December 31, 2020, the Company’s Chief Financial Officer received options to purchase up to 10,000,000 shares of the company’s common stock under the Company’s 2012 Employee Director Stock Plan at an exercise price of 10 cents per share, half that vested immediately, and half that vest upon the commercialization of the CTS process. Using a Black-Scholes asset pricing model, the vested options were valued at $414,850.

Pay Versus Performance Disclosure Table

Additional Narrative Disclosures

A majority of the Company’s employees, including its executive officers, have entered into employment contracts with the company. The company does not offer any benefits package, deferred compensation, or retirement plan at this time, other than an employee stock option plan.

Director Compensation

In March 2015, the Board of Directors approved a resolution to award compensation packages to the Company’s independent directors for their service as directors or as members of any committee of directors. Directors who are also officers are not to receive additional compensation for being Directors. A resolution dated May 5, 2021, reduced board compensation to $2,500 per quarter paid, at the option of the director, in cash or stock at the market price at the end of the quarter. Some directors have been accruing that as back pay. A resolution dated February 27, 2023, granted each board member 500,000 options that vest when the Company uplists to a major exchange.

The following table sets forth compensation we paid to our non-officer directors during the year ended December 31, 2023:

(1) See note 3 to the audited financial statements included in this prospectus for assumptions used in valuation.