Amended Annual Report (10-k/a)

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

FORM 10-K/A
(Amendment No. 1)

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

(Mark One)
x ANNUAL 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. FROM THE TRANSITION PERIOD FROM _____ TO _______.

For the fiscal year ended June 30, 2015

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 No.)

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:

NONE

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

Title of Each Class:		Name of Each Exchange on Which Registered:
Common Stock, $0.001 par value		Over the Counter (Bulletin Board)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ¨ NO x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. YES ¨ NO x

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 x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). YES x NO ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K, or any amendment to this Form 10-K. ¨

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 ¨
(Do not check if a smaller reporting company)

Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
YES ¨ NO x

State the aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant by reference to the price at which the common equity was last sold, or of the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter: $10,452,276 as of December 31, 2014 based on the closing price of $0.07 per share on such dates and 149,318,224 non-affiliate shares outstanding.

The registrant had 193,997,906 shares of common stock outstanding on June 30, 2016.

EXPLANATORY NOTE

This Amendment No. 1 on Form 10-K/A hereby amends the Annual Report on Form 10-K for the fiscal year ended June 30, 2015, which Cavitation Technologies, Inc. (the "Company") previously filed with the Securities and Exchange Commission ("SEC") on October 13, 2015. We are filing this amendment to include the information required in Part III, Items 10 through 14, that was previously omitted from the Form 10-K.

Except as expressly set forth herein, this Form 10-K/A does not reflect events occurring after the date of the original filing of the Form 10-K or modify or update any of the other disclosures contained therein in any way. Accordingly, this Form 10-K/A should be read in conjunction with the original filing on Form 10-K and the Company's other filings with the SEC.

TABLE OF CONTENTS

	Page

EXPLANATORY NOTE	i

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.	1

ITEM 11. EXECUTIVE COMPENSATION.	3

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.	5

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.	10

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.	11

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

ITEM 16. SIGNATURES, EXHIBIT INDEX.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

Person	Age	Position

Igor Gorodnitsky	55	President, PEO, Secretary and Director
Naum Voloshin	52	Principal Accounting Officer
Roman Gordon	65	CTO and Director
John Zotos	59	Director
James Fuller	74	Director

Audit committee standing members consisted of John Zotos and James Fuller as of June 30, 2015. We anticipate forming compensation, governance, and other committees as necessary.

Igor Gorodnitsky. Mr. Gorodnitsky has been our President and member of the Board of Directors since September 26, 2008, and he became the Company's Secretary and Principal Executive Officer in November of 2012. Mr. Gorodnitsky developed expertise in handling and processing hazardous waste material. As a Senior Haz-Mat Specialist, he coordinated and successfully completed more than 500 emergency response Haz-mat clean-ups over the past 20 years. He coordinated and supervised Haz Mat projects, emergency and routine spill clean-ups, and confined space entry tasks. He coordinated and scheduled manpower and purchased and scheduled equipment and materials for containment and treatment of spills. He successfully managed, coordinated and supervised projects including Hazscanning, sampling, lab-packing, manifesting, profiling, labeling, and other special procedures for a variety of commercial clients and municipalities. He is a chemist by training and holds numerous certifications and licenses including Hazwoper Training Program, Confined Space Entry and Gas Vapour HazCating, Certified Uniform Waste Manifest Training, Basic and Intermediate HazCating, On-Scene Incident Commander Emergency, Site Remediation Methods, Underground Storage Tank Removal, Health & Safety Supervisor Certification, Hazardous Certification, and Tosco Refinery Safety. Mr. Gorodnitsky was president of Express Environmental Corp. since its inception in 1980 until he sold his interest in January 2009. Based on his significant industry experience and management skills it was determined that Mr. Gorodnitsky should serve on the Company’s Board.

James Fuller . Mr. Fuller is an independent director, and has been Chairman of our Audit Committee and Independent Financial Expert since February, 2010. He was formerly a Vice President of the New York Stock Exchange and director of the Securities Investor Protection Corporation. In addition to his over 30 years of experience in the securities markets, Mr. Fuller sat on the Board of Trustees of the University of California, Santa Cruz and previously served as Chairman of their Audit Committee and Independent Financial Expert. Jim is a partner at Baytree Capital Associates, LLC. He received his BS in Political Science from San Jose State University and his MBA from California State University - Fresno. Mr. Fuller also served as a Director of Propell Technologies Group, Inc (OTCQB: Propell), a public company engaged in oil and gas exploration from October 14, 2011 until February 17, 2015. Based on Mr. Fuller’s extensive experience in finance as well as his prior public company experience it was determined that Mr. Fuller should serve on the Company’s Board.

Roman Gordon. Mr. Gordon has been our Chief Technology Officer since 2011, and he served as Chief Executive Officer and Chairman of the Board since September 26, 2008 prior to that and until 2011. He also became a permanent Director of the Company's Board during fiscal year 2015. With more than 15 years of experience in energy risk management and business management, he is one of the inventors of our intellectual properties. From 2003 to 2005 Mr. Gordon was president of Bubble Bee Corp., a car wash development company. Mr. Gordon was in charge of engineering, construction and development of environmentally friendly car wash water recycling systems. From 1997 to 2002, he was Chairman of a publicly traded electric service provider company (ESP), PowerSource Corp., where he participated in the power marketing of renewable energy and in evaluation and environmental compliance. PowerSource Energy Service Provider Corporation was an active participant in the "PowerGreen - 100" and "PowerGreen - 25" programs. Mr. Gordon received his bachelor degree in 1974 from Polytechnical Institute in Civil Engineering. Based on his knowledge of the Company’s industry and technology, and his business understanding and prior public company experience it was determined that Mr. Gordon should serve on the Company’s Board.

Naum Voloshin. Mr. Voloshin has over 20 years of experience in investment banking, business operations and marketing. Prior to joining CTi, Mr. Voloshin has worked for several developmental stage companies in US, Europe and Asia. The scope of his duties was to provide management, supervision, business experience and marketing skills.

John Zotos . Mr. Zotos was appointed as a director in June of 2014. He currently serves as a director of Propell Technologies Group, Inc (OTCQB: Propell), and its wholly owned subsidiary Novas Energy (USA), Inc., companies engaged in oil and gas exploration. Since July 2007, he has served as a principal and a managing partner of JC Holdings, LLC, a company engaged in the business of buying, selling and managing heavy equipment and commercial real estate. Based on his significant business and public company experience, which gives him a broad and extensive understanding of our operations and our industry, and his broad understanding of the operational, financial and strategic issues facing public companies, it was determined that Mr. Zotos should serve on the Company’s Board.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers, directors, persons who own more than 10% of our common stock, and immediate family members living in the same household to file an Initial Statement of Beneficial Ownership on Form 3 and changes in ownership on Form 4 with the Securities and Exchange Commission (the "SEC"). Such "insiders" are required by SEC rules to furnish us with copies of all Section 16(a) forms they file.

Based on a review of Forms 3, 4, and 5 and amendments thereto furnished to us during fiscal 2015 ended June 30, 2015, there were no delinquent forms filed during the year.

Director Independence

Although our common stock is not listed on a national securities exchange, for purposes of independence we use the definition of independence applied by the NASDAQ stock market. The Board has determined that Messrs. Zotos and Fuller are ”independent” in accordance with such definition. Messrs. Gorodnitsky and Gordon are not independent due to their current positions with the Company.

Code of Ethics

We have adopted a Code of Business Conduct and Ethics that applies to all officers, directors and employees. A copy may also be obtained free of charge by mailing a request in writing to: Cavitation Technologies, Inc., 10019 Canoga Ave., Chatsworth, CA 91311 USA. If we make any substantive amendments to the Code of Business Conduct and Ethics or grant any waiver from a provision of the Code to any executive officer or director, we will promptly disclose the nature of the amendment or waiver in a current report on Form 8-K.

ITEM 11. EXECUTIVE COMPENSATION

Executive Compensation

The following table summarizes the compensation earned by each named executive officer of the Company for the past two years determined on the basis of rules adopted by the SEC relating to smaller reporting companies.

															Changes in
															Pension
															Value and
													Non-Equity		Non-Qualified		All
								Stock		Option			Incentive Plan		Deferred		Other
	Year		Salary			Bonus		Awards (1)		Awards			Compensation		Compensation		Compensation		Totals
Igor Gorodnitsky*		2015	$	165,950	(1)	$	-		-	$	-		$	-	$	-	$	-	$	165,950
President, Principal Executive Officer		2014	$	143,000	(1)	$	-		-	$	119,973	(3)	$	-	$	-	$	-	$	262,973

Naum Voloshin		2015	$	60,750	( 4)	$	-		-	$	-		$	-	$	-	$	-	$	60,750
Principal Accounting Officer		2014	$	36,000	(4)	$	10,000		-	$	119,973	(5)	$	-	$	-	$	-	$	155,973

Roman Gordon*		2015	$	165,950	(2)	$	-		-	$	-		$	-	$	-	$	-	$	165,950
Chief Technology Officer		2014	$	143,000	(2)	$	-		-	$	119,973	(3)	$	-	$	-	$	-	$	262,973

(1)	For the year ended June 30, 2015, Mr. Gorodnitsky earned a base salary of $165,950, all of which was paid in full. At June 30, 2015, Mr. Gorodnitsky was owed an aggregate of $252,698 in unpaid compensation for services he rendered during the years ended June 30, 2012 and 2011. For the year ended June 30, 2014, Mr. Gorodnitsky earned a base salary of $143,000 which was paid in full.
(2)	For the year ended June 30, 2015, Mr. Gordon earned a base salary of $165,950, all of which was paid in full. At June 30, 2015, Mr. Gordon was owed an aggregate of $208,698 in unpaid compensation for services rendered during the years ended June 30, 2012 and 2011. For the year ended June 30, 2014, Mr. Gordon earned a base salary of $143,000 which was paid in full.
(3)	For the year ended June 30, 2014, Messrs. Gorodnitsky and Gordon each received warrants to purchase 3,000,000 share of common stock with a fair value of $119,973. Option and Warrant Awards are reported at the aggregate grant date fair value computed in accordance with ASC 718. These warrants are exercisable at $0.04 per share, vested immediately and expire in ten years or on October 10, 2023. The fair value of the warrants was computed using Black-Scholes Merton valuation model with the following assumptions: risk-free interest rate of 0.90%, dividend yield of 0%, volatility of 232%, and an expected life of 5 years.
(4)	For the year ended June 30, 2015, Mr. Voloshin earned a base salary of $60,750 all of which was paid in full. Mr. Voloshin earned a base salary of $36,000 for the year ended June 30, 2014, all of which was paid in full. Mr. Voloshin also received a bonus of $10,000 at June 30, 2014 which was paid in the first fiscal quarter of 2015.
(5)	For the year ended June 30, 2014, Mr. Voloshin received warrants to purchase 3,000,000 share of common stock with a fair value of $119,973. Option and Warrant Awards are reported at the aggregate grant date fair value computed in accordance with ASC 718. These warrants are exercisable at $0.04 per share, vested immediately and expire in ten years or on October 10, 2023. The fair value of the warrants was computed using Black-Scholes Merton valuation model with the following assumptions: risk-free interest rate of 0.90%, dividend yield of 0%, volatility of 232%, and an expected life of 5 years.

*Messrs Gorodnitsky and Gordon also served as members of the Board of Directors during fiscal 2015 but did not receive any compensation for those services.

Outstanding Equity Awards at Fiscal Year-End

The following table shows outstanding equity-based awards that were held by executive officers as of June 30, 2015.

	Option Awards											Stock Awards
																Equity		Equity Incentive
														Market		Incentive		Plan Awards:
	Number			Number										value of		Plan Awards		market or
	of securities			of securities								# of Shares		Shares		# of Unearned		payout value of
	Underlying			Underlying								or units of		or units of		Shares, units		unearned shares,
	Unexercised			Unexercised		Option/warrant		Option/warrant		Option/warrant		stock that		stock that		or other		units or other
	Options/warrants			Options/warrants		grant		Exercise		expiration		have not		have not		rights that		rights that have
Name	# Exercisable			# Unexercisable		date		Price		date		vested		vested		have not vested		not vested

Igor Gorodnitsky		4,250,000			-		12/18/2012	$	0.05		12/18/2022		-		-		-	$	-
President and		5,000,000			-		3/20/2013	$	0.04		3/20/2023		-		-
Principal Executive Officer

Roman Gordon		4,250,000			-		12/18/2012	$	0.05		12/18/2022		-		-		-	$	-
Chief		5,000,000			-		3/20/2013	$	0.04		3/20/2023		-		-
Technology Officer

Naum Voloshin		-			-		-	$	-		-		-		-		-	$	-
Principal		3,000,000	(1)		-		10/10/2013	$	0.04		10/10/2023		-		-
Accounting Officer

(1)

A company controlled by Mr. Voloshin was issued 7,610,000 warrants to acquire common stock with fair market value of $683,823 and was issued 7,610,000 shares of common stock with a fair value of $684,900 upon settlement of a 2012 demand note. Option and Warrant Awards are reported at the aggregate grant date fair value computed in accordance with ASC 718. These warrants were issued at $0.05 per share, vested immediately and expire in five years or on April 1, 2019. The fair value of the warrants was computed using Black-Scholes Merton valuation model with the following assumptions: risk-free interest rate of $3.56%, dividend yield of 0%, volatility of %190, and an expected life of 5 years.

We do not offer retirement benefit plans to our executive officers.

Compensation of Directors

The following table sets forth certain information with respect to the compensation paid to our directors for fiscal 2015 determined on the basis of rules adopted by the SEC relating to smaller reporting companies.

Fees

Non-equity

Earned

inventive

Non-qualified

or paid

Stock

Option

plan

deferred

All other

in cash

Awards

compensation

Total

Name

($)

Earnings

($)

James Fuller (1)

John Zotos (1)

Igor Gorodnitsky (1)

Roman Gordon (1)

Messrs. Fuller, Zotos, Gorodnitsky and Gordon did not receive any compensation for their services in fiscal 2015.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information concerning the number of shares of our common stock known by us to be owned beneficially as of June 30, 2016 and the date hereof by: (i) each person (including any group) that owns more than 5% of any class of the voting securities of our company; (ii) each director and officer of our company; and (iii) directors and officers as a group. Unless otherwise indicated, the stockholders listed possess sole voting and investment power with respect to the shares shown. The address for all directors and officers, unless otherwise indicated, is 10019 Canoga Avenue, Chatsworth, CA 91311.

		Amount and
		Nature of
	Title of	Beneficial		Percent of
Name of Beneficial Owner	Class	Ownership		Class (1)
Igor Gorodnitsky	Common Stock		17,323,475		8.5	%(2)
President , Principal Executive Officer, Director

James Fuller	Common Stock		837,500		0.4	%
Chairman of Audit Committee, Director

Roman Gordon	Common Stock		16,688,475		8.2	%(2)
Director, Chief Technology Officer

Naum Voloshin	Common Stock		10,610,000		5.3	%(3)
Principal Accounting Officer

John Zotos	Common Stock		1,000,000		*	(4)
Director

BioWorld Management LTD	Common Stock		9,500,000		4.9	%

Directors and Officers	Common Stock		46,459,450		20.7	%
(as a group, five individuals)

(1)	Based on 193,997,906 issued and outstanding shares of common stock as of June 30, 2016.
(2)	Messrs. Gorodnitsky and Gordon each have the right to acquire 4,250,000 shares of common stock through stock options and 5,000,000 shares of common stock through warrants which are included in the shares beneficially owned by each.
(3)	Includes 14,743,475 shares of common stock held by the Roman Gordon and Larisa Magid Living Trust (the “Trust”). Mr. Gordon is the beneficiary of the Trust and as such has a pecuniary interest in the shares of common stock held by the Trust..
(4)	Mr. Voloshin has the right to acquire 3,000,000 shares of common stock through warrants. In addition, a company controlled by Mr. Voloshin was issued 7,610,000 warrants to acquire common stock and 7,610,000 shares of common stock for conversion of a demand note it held.
(5)	Mr Zotos was granted a total of 1,000,000 warrants to acquire company's stock, all of which are vested as of June 30, 2016.

*Less than 1%

Stock Options

The Company has not adopted a formal stock option plan. However, it has assumed outstanding stock options resulting from the acquisition of its wholly-owned subsidiary, Hydrodynamic Technology, Inc. In addition, the Company has made periodic non- plan grants. A summary of the stock option activity from June 30, 2015 and 2014 is as follows:

						Weighted-
						Average
				Weighted-		Remaining
				Average		Contractual
				Exercise		Life
	Options			Price		(Years)

Outstanding June 30, 2013		13,611,815			0.10		8.17

- Granted		-			-		-
- Forfeited		-			-		-
- Exercised		-			-		-
- Expired		-			-		-
Outstanding June 30, 2014		13,611,815			0.10		6.37

- Granted		-			-		-
- Forfeited/Replaced		(800,858	)		-		-
- Exercised		-			-		-
- Expired		-			-		-
Outstanding at June 30, 2015		12,810,957			0.10		5.35
Exercisable at June 30, 2015		12,810,957			0.10		5.35

In June 2015, the Company cancelled fully vested stock options to purchase 800,858 shares of common stock that were granted to a consultant in prior periods. In exchange for the cancellation, we granted the consultant 800,858 shares of common stock.

The intrinsic value of the outstanding options was $330,000 and $590,043 as of June 30, 2015 and 2014, respectively. The following table summarizes additional information concerning options outstanding and exercisable at June 30, 2015.

		Options Outstanding						Options 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		11,000,000		5.96	$	0.03		11,000,000	$	5.96
$	0.33		637,297		1.31	$	0.33		637,297	$	1.31
$	0.67		1,173,660		1.68	$	0.67		1,173,660	$	1.68
			12,810,957						12,810,957

Warrants

A summary of the Company's warrant activity and related information from as of June 30, 2015 and 2014 is as follows.

					Weighted-
					Average
			Weighted-		Remaining
			Average		Contractual
			Exercise		Life
	Warrants		Price		(Years)

Outstanding at June 30, 2013		18,433,867		0.09		6.74

Granted		47,362,581		0.07		7.40
Exercised		-		-		-
Expired		2,729,934		0.50		-
Outstanding at June 30, 2014		63,066,514		0.06		6.91

Granted		5,193,329		0.12		5.00
Exercised		-
Expired		-
Outstanding at June 30, 2015		68,259,843		0.07		5.77
Exercisable at June 30, 2015		68,259,843		0.07		5.77

2015

In July of 2014, the Company issued warrants to purchase 5,193,329 shares of common stock to the purchasers of our common stock offering. The warrants are exercisable at $0.12 per share, vesting immediately and expiring in 5 years from the grant date.

During the year ended June 30, 2015, the Company recognized compensation expense of $245,375 to account for the fair value of vested warrants granted to a consultant and a member of our Board of Directors.

2014

In October 2013, the Company granted employees warrants to purchase 9,100,000 shares of common stock at $0.04 per share, vesting immediately and expiring in 5 and 10 years from the grant date. The fair value of the warrants amounted to $363,882 using the Black-Scholes Merton valuation model.

In October 2013, the Company granted consultants warrants to purchase 13,100,000 shares of common stock at prices ranging from $0.04 up to $0.045 per share, vesting over a period of one year and expiring in 5 and 10 years from the grant date. The fair value of the warrants that vested during the current fiscal year amounted to $726,299 using the Black-Scholes Merton valuation model.

In April 2014, the Company granted a total of 9,029,251 warrants to demand note holders pursuant to settlement agreements.

In April 2014, the Company granted a new Board member warrants to purchase 1,000,000 shares of common stock at $0.08 per share which vest over a period of one year and expiring in 5 years from the grant date. The fair value of the warrants at the grant date amounted to $79,764 using the Black-Scholes Merton valuation model. During the year ended June 30, 2014, we recognized a total of $3,324 based upon the vesting of the warrants.

In June of 2014, the Company issued warrants to purchase 15,133,330 shares of common stock to the purchasers of our common stock offering. The warrants are exercisable at $0.12 per share, vesting immediately and expiring in 5 years from the grant date.

The intrinsic value of the outstanding warrants was $651,999 and $1,551,329 as of June 30, 2015 and 2014, respectively. The following table summarizes additional information concerning warrants outstanding and exercisable at June 30, 2015.

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

$	0.04 - 0.07		47,933,184		6.75	$	0.05		44,641,518	$	0.05
$	0.12		20,326,659		4.25	$	0.12		20,326,659	$	0.12
			68,259,843						68,259,843

The table below represents the assumptions used in valuing the stock options and warrants granted in fiscal 2015 and 2014:

	Year Ended June 30,
	2015	2014

Expected life in years	3 - 10	3 - 10
Stock price volatility	183% - 191%	185% - 232%
Risk free interest rate	2.75% - 3.21%	1.44% - 3.50%
Expected dividends	None	None
Forfeiture rate	0%	0%

The assumptions used in the Black Scholes models referred to above are based upon the following data: (1) the contractual life of the underlying non-employee options is the expected life. The expected life of the employee option is estimated by considering the contractual term of the option, the vesting period of the option, the employees' expected exercise behavior and the post-vesting employee turnover rate. (2) The expected stock price volatility was based upon the Company's historical stock price over the expected term of the option. (3) The risk free interest rate is based on published U.S. Treasury Department interest rates for the expected terms of the underlying options. (4) The expected dividend yield was based on the fact that the Company has not paid dividends to common shareholders in the past and does not expect to pay dividends to common shareholders in the future. (5) The expected forfeiture rate is based on historical forfeiture activity and assumptions regarding future forfeitures based on the composition of current grantees.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Certain Related Party Transactions

Since the beginning of our last fiscal year , there has not been, and there is not currently proposed, any transaction or series of similar transactions to which we were or will be a party in which the amount involved exceeded or will exceed the lesser of $120,000 or one percent of the average of our total assets at year-end for the last two completed fiscal years and in which any of our directors, executive officers, holders of more than five percent of any class of our voting securities or any member of the immediate family of the foregoing persons had or will have a direct or indirect material interest.

Director Independence

As our common stock is currently traded on the OTC Bulletin Board, we are not subject to the rules of any national securities exchange which require that a majority of a listed company's directors and specified committees of the board of directors meet independence standards prescribed by such rules. For the purpose of preparing the disclosures in this Report on Form 10-K regarding director independence, we have used the definition of "independent director" set forth in the Marketplace Rules of The NASDAQ, which defines an "independent director" generally as a person other than an executive officer or employee of the Company or any other individual having a relationship which, in the opinion of the Company's board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Consistent with these standards, we believe that James Fuller is an Independent Financial Expert and independent director and that John Zotos is an independent director.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Audit

Our principal auditing firm during fiscal 2015 and 2014 was Weinberg & Co, in Los Angeles. Weinberg & Co performed reviews of quarterly financial statements included on Forms 10-Q for the first three quarters of 2015 and is the principal auditing firm for the audit of our annual financial statements included with Form 10-K for fiscal 2015 and received approximately $57,000 for these services.

Tax Fees

The aggregate fees billed in fiscal 2015 and 2014 for professional services rendered by the principal accountant for tax preparation amounted to $12,500 and $7,150 respectively.

Audit Committee

The charter of the Audit Committee provides that the Audit Committee pre-approves all audit services and permitted non-audit services to be performed for CTi by its independent public accounting firm, subject to the de minimus exceptions for non-audit services described in Section 10A(i)(1)(B) of the Exchange Act.

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

CAVITATION TECHNOLOGIES, INC.

/s/ Igor Gorodnitsky

Igor Gorodnitsky

President

(Principal Executive Officer)

July 5, 2016

CAVITATION TECHNOLOGIES, INC.

/s/ Naum Voloshin

Naum Voloshin

Chief Financial Officer

(Principal Financial Officer)

July 5, 2016