UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT DATED ~~June~~September 30, 2022 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the ~~six~~nine months ended ~~June~~September 30, 2022

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

For the transition period from _________ to _________

Commission File Number: 000-55656

CLEAN ENERGY TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

Nevada

20-2675800

(State or other jurisdiction

of incorporation or organization)

(I.R.S. Employer

Identification No.)

2990 Redhill Ave, Costa Mesa, California 92626

(Address of principal executive offices)

(~~949~~(949)) 273-4990

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically 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 ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller 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 ~~August 22,~~November 14, 2022, there were ~~966,675,946~~1,482,977,289 shares of the Registrant’s $0.001 par value common stock issued and outstanding.

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common		CETY		OTCQB

CLEAN ENERGY TECHNOLOGIES, INC.

(A Nevada Corporation)

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION

ITEM 1.	CONSOLIDATED FINANCIAL STATEMENTS	3

ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	26

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	3031

ITEM 4.	CONTROLS AND PROCEDURES	3031

PART II. OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS	3031

ITEM 1A.	RISK FACTORS	3031

ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	3031

ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	3132

ITEM 4.	MINE SAFETY DISCLOSURES	3132

ITEM 5.	OTHER INFORMATION	3132

ITEM 6.	EXHIBITS	3132

Part I – Financial Information

Item 1. Financial Statements

Clean Energy Technologies, Inc.

Consolidated Financial Statements

(Expressed in US dollars)

~~June~~September 30, 2022 (unaudited)

Financial Statement Index

Consolidated Balance Sheets ~~June~~September 30, 2022 (unaudited) and December 31, 2021	4

Consolidated Statements of Operations (unaudited)	5

Consolidated Statements of Stockholders Deficit (unaudited)	6

Consolidated Statements of Cash Flows (unaudited)	7

Notes to the Consolidated Financial Statements (unaudited)	8

Clean Energy Technologies, Inc.

Consolidated Balance Sheets

	Unaudited			Audited			Unaudited			Audited
	June 30, 2022			December 31, 2021			September 30, 2022			December 31, 2021
Assets
Current Assets:
Cash	$	968,919		$	1,192,316		$	175,772		$	1,192,316
Accounts receivable - net		1,783,533			693,032			1,806,792			693,032
Lease receivable asset		217,584			217,584			217,584			217,584
Prepaid		13,140			40,380			231,288			40,380
Heze Hongyuan Natural Gas Co		785,828						838,090
Inventory		487,875			462,192			527,949			462,192
Total Current Assets		4,256,879			2,605,504			3,797,475			2,605,504
Property and Equipment - Net		23,916			33,016			19,366			33,016

Goodwill		747,976			747,976			747,976			747,976
LWL Intangibles		1,468,709			1,468,709			1,468,709			1,468,709
Long Term Investment - Shuya								536,994
Long-term financing receivables - net		684,770			684,770			684,770			684,770
License		354,322			354,322			354,322			354,322
Patents		109,631			115,569			106,662			115,569
Right of use asset - long term		276,731			395,607			217,862			395,607
Other Assets		28,082			26,801			30,199			26,801
Total Non Current assets		3,670,221			3,793,754			4,147,494			3,793,754
Total Assets	$	7,951,016		$	6,432,274		$	7,964,334		$	6,432,274

Liabilities and Stockholders’ (Deficit)
Current Liabilities:
Accounts payable	$	625,585		$	606,814		$	651,769		$	606,814
Accrued Expenses		141,563			143,847			124,830			143,847
Customer Deposits		0			24,040			0			24,040
Warranty Liability		100,000			100,000			100,000			100,000
Deferred Revenue		33,000			33,000			33,000			33,000
Derivative Liability		270,082			256,683			269,663			256,683
Facility Lease Liability - current		252,504			213,474			246,081			213,474
Line of Credit		1,109,813			1,169,638			1,058,127			1,169,638
Notes payable - GE		2,526,036			2,498,076			2,540,016			2,498,076
Convertible Notes Payable (net of discount of $217,936 and $26,919 respectively)		1,683,315			1,193,341
Convertible Notes Payable (net of discount of $437,044 and $26,919 respectively)								2,495,158			1,193,341
Related Party Notes Payable		723,353			626,210			279,517			626,210
Total Current Liabilities		7,465,251			6,865,123			7,798,161			6,865,123
Long-Term Debt:
Related Party Notes Payable (net of discount of $0 and $0 Respectively		1,081,085			1,081,085			0			1,081,085
Facility Lease Liability - long term		51,588			207,778			0			207,778
Net Long-Term Debt		1,132,673			1,288,863			0			1,288,863
Total Liabilities		8,597,924			8,153,986			7,798,161			8,153,986

Commitments and contingencies	$	-			-			-		$	-

Stockholders’ (Deficit)
Common stock, $.001 par value; 2,000,000,000 shares authorized; 966,675,946 and 943,569,149 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively		966,676			943,569
Common stock, $.001 par value; 2,000,000,000 shares authorized; 1,482,977,289 and 943,569,149 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively								1,482,978			943,569
Additional paid-in capital		16,416,842			14,777,708			17,690,269			14,777,708
Subscription Receivables		(18,800	)		-			0	)		-
Accumulated Other Comprehensible Income		(109,104	)					(243,135	)
Accumulated deficit		(17,883,464	)		(17,423,930	)		(18,763,939	)		(17,423,930	)
Total Stockholders’ (Deficit)		(627,850	)		(1,702,653	)		166,173			(1,702,653	)

Non-controlling interest		(19,059	)		(19,059	)		0	)		(19,059	)
Total Stockholders’ (Deficit)		(646,909	)		(1,721,712	)
Total Stockholders’ Equity								166,173			(1,721,712	)
Total Liabilities and Stockholders’ Deficit	$	7,951,016		$	6,432,274		$	7,964,334		$	6,432,274

The accompanying footnotes are an integral part of these consolidated financial statements

Clean Energy Technologies, Inc.

Consolidated Statements of Operations

for the three and ~~six~~nine months ended ~~June~~September 30, 2022 and 2021

(Unaudited)


	2022 Three Months			2021 Three Months			2022 Six Months			2021 Six Months			2022 Three Months			2021 Three Months			2022 Nine Months			2021 Nine Months
Sales	$	1,747,701			155,884		$	2,522,968		$	291,158		$	44,629			575,545		$	2,567,596		$	866,703
Cost of Goods Sold		1,135,904			49,356			1,396,978			72,619			18,716			274,401			1,415,693			374,020
Gross Profit		611,797			106,528			1,125,990			218,539			25,913			301,144			1,151,903			519,683

General and Administrative
General and Administrative expense		108,368			211,673			201,303			340,521			79,252			188,817			284,025			529,335
Salaries		199,675			225,104			390,892			433,069			197,036			228,565			587,928			661,634
Travel		59,664			25,339			87,398			40,354			38,990			26,381			126,388			66,735
Professional Fees Legal & Accounting		159,342			49,373			224,195			82,209			135,441			41,174			359,636			123,383
Facility lease and Maintenance		84,519			82,699			173,480			168,910			86,781			85,798			260,262			254,708
Subcontractors		36,248						62,051			-			21,880						83,931			-
Depreciation and Amortization		7,519			8,073			15,038			16,146			7,519			8,073			22,557			24,219
Total Expenses		655,335			602,261			1,154,358			1,081,209			566,899			578,808			1,724,727			1,660,014
Net Profit / (Loss) From Operations		(43,537	)		(495,733	)		(28,368	)		(862,670	)		(540,986	)		(277,664	)		(572,824	)		(1,140,331	)

Change in derivative liability		(29,414	)		(3,804	)		(13,399	)		1,745,369			419			(10,745	)		(12,980	)		1,734,624
Gain / (Loss) on debt settlement and write down		2,920			368,098			2,920			368,098			0			460,568			2,920			828,666
Other Income		23,593						14,258						9,976						25,790
Interest and Financing fees		(283,804	)		(100,417	)		(416,275	)		(414,069	)		(331,177	)		(189,171	)		(747,451	)		(603,240	)
Net Profit / (Loss) Before Income Taxes		(330,242	)		(231,856	)		(440,864	)		836,728			(861,768	)		(17,012	)		(1,304,546	)		819,719
Income Tax Expense		(16,701	)					(18,667	)					353						(18,315	)
Net Profit / (Loss)		(346,943	)		(231,856	)		(459,531	)		836,728			(861,415	)		(17,012	)		(1,322,861	)		819,719

Non-controlling interest														(19,059	)		19059			(19,059	)		19,059

Net Profit / (Loss) attributable to Clean Energy Technologies, Inc.		(346,943	)		(231,856	)		(459,531	)		836,728			(880,474	)		2,047			(1,341,920	)		838,778

Other Comprehensive Item
Foreign Currency Translation Gain		(113,666	)					(109,104	)		-			(134,031	)					(243,135	)		-
Total Comprehensible Income / (Loss)	$	(460,609	)		(231,856	)	$	(568,635	)	$	836,728		$	(880,474	)		2,047		$	(1,585,055	)	$	838,778

Per Share Information:
Basic and diluted weighted average number of common shares outstanding		965,929,205			895,498,243			959,148,981			853,322,779			1,022,795,657			922,225,702			980,597,678			891,312,514
Diluted weighted average number of common shares outstanding		965,929,205			895,498,243			959,148,981			1,339,978,304			0			0			0			0
Net Profit / (Loss) per common share basic and diluted	$	(0.00	)		(0.00	)	$	(0.00	)	$	0.00		$	(0.00	)		(0.00	)	$	(0.00	)	$	0.00

The accompanying footnotes are an integral part of these Consolidated financial statements

Clean Energy Technologies, Inc.

Consolidated Statements of Stockholders Deficit

~~June~~September 30, 2021 & 2022 (Unaudited)

Description	Shares		Amount		Shares			Amount			Amount			Capital					Deficit				Totals

	Common Stock .001 Par				Preferred Stock						Common Stock to be issued			Additional Paid in					Accumulated				Stock holders’ Deficit			Common Stock .001 Par				Preferred Stock						Common Stock to be issued			Additional Paid in					Accumulated			Non Controlling			Stock holders’ Deficit
Description	Shares		Amount		Shares			Amount			Amount			Capital					Deficit				Totals			Shares		Amount		Shares			Amount			Amount			Capital					Deficit			interest			Totals
December 31, 2020		821,169,656	$	821,171		4,500		$	450,000		$	61,179		$	9,080,560		-	-	$	(17,651,482	)	-	$	(7,238,572	)	821,169,656		821,171		4,500			450,000			61,179			9,080,560			-	-	(17,651,482			-			(7,238,572

Shares issued for warrant conversion		1,797,861		1,798		-			-			-			(1,798	)				-				(0	)		1,797,861		1,798		-			-			-			(1,798	)				-			-			(0	)
Shares issued for Reg A offering		16,666,667		16,667											483,333									500,000			16,666,667		16,667											483,333		-	-					-			500,000
Shares issued for acccrued dividend		4,344,250		4,344		-			-			-			343,194					-				347,538			4,344,250		4,344		-			-			-			343,194					-						347,538
Conversion of Preferred Series D		6,625,000		6,625		(4,500	)		(450,000	)		-			443,375									-			6,625,000		6,625		(4,500	)		(450,000	)		-			443,375											-
Inducement shares		1,250,000		1,250								(25,000	)		23,750									-			1,250,000		1,250								(25,000	)		23,750											-
Shares issued for cash		44,213,053		44,213		-			-			(36,179	)		3,075,969									3,084,003			44,213,053		44,213		-			-			(36,179	)		3,075,969											3,084,003
																								-																											-
Net Loss		-				-						-					-	-		1,068,584		-		1,068,584																		-			1,068,584						1,068,584
March 31, 2021		896,066,487	$	896,068		-		$	-		$	-		$	13,448,384		-	-	$	(16,582,898	)	-	$	(2,238,447	)		896,066,487	$	896,068		-		$	-		$	-		$	13,448,384		-	-	$	(16,582,898	)	$	-		$	(2,238,447	)
Shares issued for warrant conversion		547,468		547											(547	)								-			547,468		547											(547	)		-		-						-
Shares issued for cash		36,283		36		-			-															36			36,283		36					-			-											-			36
Shares for conversion		25,000,000		25,000											50,473									75,473
Shares for Conversion																											25,000,000		25,000											50,473		-	-								75,473
Net Loss		-				-						-					-	-		(231,856	)	-		(231,856	)																	-			(231,853	)					(231,853	)
June 30, 2021		921,650,238	$	921,651		-		$	-		$	-		$	13,498,310		-	-	$	(16,814,754	)	-	$	(2,394,794	)		921,650,238		921,651		-			-			-			13,498,310		-	-		(16,814,751	)		-			(2,394,791	)

Shares issued for correction																											1,100,630		1,101					-			-			(1,101	)	-	-		-			-			-
Shares issued for inducement																											1,142,459		1,141											53,125											54,266
Net Loss																																													2,047			(19,059	)		(17,012	)
September 30, 2021																											923,893,327		923,893		-			-			-			13,550,334		-	-		(16,812,704	)		(19,059	)		(2,357,537	)

Description Shares Amount Shares Amount Amount Capital Deficit interest Totals
Common Stock
.001 Par Preferred Stock Common Stock to be
issued Additional
Paid in Accumulated Non
Controlling Stock holders’
Deficit
Description Shares Amount Shares Amount Amount Capital Deficit interest Totals
December 31, 2020 821,169,656 $ 821,171 4,500 $ 450,000 $ 61,179 $ 9,080,560 $ (17,651,482 ) - $ (7,238,572 )
Beginning balance, value 821,169,656 $ 821,171 4,500 $ 450,000 $ 61,179 $ 9,080,560 $ (17,651,482 ) $ - $ (7,238,572 )

Shares issued for warrant conversion 2,345,329 2,345 - - - (2,345 ) - (0 )
Shares issued for acccrued dividend 4,344,250 4,344 - - - 343,194 - 347,539
Conversion of Preferred Series D 6,625,000 6,625 (4,500 ) (450,000 ) - 443,375 -
Inducement Shares 2,392,459 2,391 - - (25,000 ) 76,875 - - 54,266
Shares issued for correction 1,100,630 1,101 (1,101 ) -
Shares for Conversion 25,000,000 25,000 50,473 75,473
Shares issued for Reg A offering 16,666,667 16,667 483,333 500,000
Shares issued for S1 9,842,072 9,843 380,508 390,351
Shares issued for cash 44,249,336 44,249 - - (36,179 ) 3,075,969 3,084,039
Shares issued for Reg A 9,833,750 9,834 776,866 786,700
Starting balance CETY HK 70,000 (70,000) -
Net Loss 297,551 (19,059 ) 278,492
December 31, 2021 943,569,149 943,569 - - - 14,777,708 (17,423,931 ) (19,059 ) (1,721,712 )
Ending balance, value 943,569,149 943,569 - - - 14,777,708 (17,423,931 ) (19,059 ) (1,721,712 )
Description Shares Amount Shares Amount Amount Capital Interest Income Deficit interest Totals
Common Stock
.001 Par Preferred
Stock
Common
Stock
to be
issued

Additional
Paid in
Subscription Accumulated Comprehensive Accumulated
Non
Controlling

Stock
holders’
Deficit

Description Shares Amount Shares Amount Amount Capital Interest Income Deficit interest Totals
Beginning balance value 943,569,149 943,569 - - - 14,777,708 - - (17,423,931 (19,059 (1,721,712 )
Shares issued for Reg A offering 15,035,000 15,035 - 1,187,765 - - 1,202,800
Shares issued for S1 3,155,865 3,156 - 134,754 137,910
-
Subscription Receivable - (18,800 ) (18,800 )
Accumulated Comprehensive - 4,562 4,562
Net Loss - - - - - (112,589 ) - (112,589 )
March 31, 2022 961,760,014 961,760 - - - 16,100,228 (18,800 ) 4,562 (17,536,520 ) (19,059 ) (507,830 )

Shares issued for Reg A offering - - - - - -
Shares issued for S1 4,915,932 4,916 - 148,319 153,235
Warrants issued Mast Hill fund - 168,296 168,296
Subscription Receivable - - -
Accumulated Comprehensive - (113,666 ) (113,666 )
Net Loss - - - - - (346,943 ) - (346,943 )
June 30, 2022 966,675,946 966,676 - - - 16,416,843 (18,800 ) (109,104 ) (17,883,464 ) (19,059 ) (646,909 )

Shares issued for Reg A offering - - - - -
Shares issued for MGW Note Conversion 516,301,343 516,301 - 1,032,603 - 1,548,904
Warrants issued Q3 Bridge Financing - 240,824 240,824
Subscription Receivable - 18,800
Accumulated Comprehensive - (134,031 ) (134,031 )
Net Loss - - - - - (880,474 ) -19060 (861,415 )
September 30, 2022 1,482,977,288 1,482,977 - - - 17,690,269 0 (243,136 ) (18,763,939 ) 0 166,173
The accompanying footnotes are an integral part of these consolidated financial statements
6

Clean Energy Technologies, Inc.

Common Stock
.001 Par
Preferred Stock
Common
Stock
to be
issued

Additional
Paid in
Subscription
Accumulated
Comprehensive
Accumulated
Non
Controlling

Stock
holders’
Deficit

Description Shares Amount Shares Amount Amount Capital Interest Income Deficit interest Totals
December 31, 2021 943,569,149 943,569 - - - 14,777,708 - - (17,423,931 ) (19,059 ) (1,721,712 )

Shares issued for Reg A offering 15,035,000 15,035 1,187,765 1,202,800
Shares issued for S1 3,155,865 3,156 134,754 137,910
-
Subscription Receivable (18,800 ) (18,800 )
Accumulated Comprehensive 4,562 4,562
Net Loss - - - - - - - (112,589 ) - (112,589 )
March 31, 2022 961,760,014 961,760 - - - 16,100,228 (18,800 ) 4,562 (17,536,520 ) (19,059 ) (507,830 )
Beginning balance 961,760,014 961,760 - - - 16,100,228 (18,800 ) 4,562 (17,536,520 ) (19,059 ) (507,830 )

Shares issued for Reg A offering - - - -
Shares issued for S1 4,915,932 4,916 148,319 153,235
Warrants issued Mast Hill fund 168,296 168,296
Subscription Receivable - -
Accumulated Comprehensive (113,666 ) (113,666 )
Net Loss - - - - - - (346,943 ) - (346,943 )
June 30, 2022 966,675,946 966,676 - - - 16,416,843 (18,800 ) (109,104 ) (17,883,464 ) (19,059 ) (646,909 )
Ending balance 966,675,946 966,676 - - - 16,416,843 (18,800 ) (109,104 ) (17,883,464 ) (19,059 ) (646,909 )
Consolidated Statements of Cash Flows
for the nine months ended September 30 (Unaudited)
2022 2021
Cash Flows from Operating Activities:
Net Income / ( Loss ) $ (1,322,861 ) $ 819,719
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 22,557 24,219
Financing Fees 380,000 0
Gain on debt settlement (2,920 ) (828,666 )
Shares issued for inducement 54,266
Amortization of debt discount 145,632
Change in debt discount and Financing fees 0 730,826
Change in derivative liability 12,980 (1,734,624 )
Changes in assets and liabilities:
(Increase) decrease in right of use asset 177,745 144,588
(Increase) decrease in lease liability (175,172 ) (141,153 )
(Increase) decrease in accounts receivable (1,113,760 ) (511,418 )
(Increase) decrease in longterm financing receivables 67,730
(Increase) decrease in inventory (65,757 ) (167,739 )
(Increase) decrease in prepaid expenses (194,306 ) -
(Decrease) increase in accounts payable 44,955 (673,236 )
Other (Decrease) increase in accrued expenses 171,619 141,969
Other (Decrease) increase in accrued expenses related party 0 (2,482 )
Other (Decrease) increase on equity method investment 13,650 -
Other (Decrease) increase in customer deposits (24,040 ) 111,770
Net Cash Provided by (Used In) Operating Activities (1,929,678 ) (1,964,231 )

Cash Flows from Investing Activities
Convertible Note Receivable
(Increase) decrease in Heze Hongyuan Natural Gas Co (838,090 ) -
(Increase) decrease in Shuya (550,644 )
Purchase property plant and equipment
Cash Flows Used In Investing Activities (1,388,734 ) -

Cash Flows from Financing Activities
Bank Overdraft / (Repayment)
Payment on line of credit (219,656 ) (894,208 )
Payment on notes payable (406,586 ) -
Proceeds from notes payable 1,677,300 414,200
Proceeds from notes payable related party - -
Stock issued for cash 1,493,945 3,584,511
Cash Flows Provided By Financing Activities 2,545,003 3,104,503

Effect of exchange rate changes on cash (243,136 ) -

Net (Decrease) Increase in Cash and Cash Equivalents (1,016,545 ) 1,140,272
Cash and Cash Equivalents at Beginning of Period 1,192,316 414,885
Cash and Cash Equivalents at End of Period $ 175,771 $ 1,555,157

Supplemental Cashflow Information:
Interest Paid $ 331,177 $ 145,230
Taxes Paid $ $ -

Supplemental Non-Cash Disclosure
Discount on new notes $ 437,044 $ -
Shares to be issued for warrants $ 240,824 $ 450,000
Shares issued for debt conversion conversions $ 1,548,904 $ 423,011

The accompanying footnotes are an integral part of these consolidated financial statements

6
~~Clean Energy Technologies, Inc.~~
~~Consolidated Statements of Cash Flows~~
~~for the six months ended June 30 (Unaudited)~~
2022 2021
Cash Flows from Operating Activities:
Net Income / ( Loss ) $ (459,531 ) $ 836,728
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 15,038 16,146
Financing Fees 82,850 0
Gain on debt settlement (2,920 ) (368,098 )
Amortization of debt discount 52,279
Change in debt discount and Financing fees 0 412,407
Change in derivative liability 13,399 (1,745,369 )
Changes in assets and liabilities:
(Increase) decrease in right of use asset 118,876 100,544
(Increase) decrease in lease liability (117,161 ) (97,965 )
(Increase) decrease in accounts receivable (1,090,501 ) (33,020 )
(Increase) decrease in inventory (25,683 ) (168,421 )
(Increase) decrease in prepaid expenses 25,959 -
(Decrease) increase in accounts payable 54,697 (322,518 )
Other (Decrease) increase in accrued expenses 25,676 (364,718 )
Other (Decrease) increase in accrued expenses related party 97,143 255,082
Other (Decrease) increase in deferred revenue 0 -
Other (Decrease) increase in customer deposits (24,040 ) 30,000
Net Cash Provided by (Used In) Operating Activities (1,233,918 ) (1,449,202 )

Cash Flows from Investing Activities
Convertible Note Receivable
(Increase) decrease in Heze Hongyuan Natural Gas Co (785,828 ) -
Purchase property plant and equipment
Cash Flows Used In Investing Activities (785,828 ) -

Cash Flows from Financing Activities
Bank Overdraft / (Repayment)
Payment on line of credit (59,825 ) (598,127 )
Payment on notes payable (272,616 ) -
Proceeds from notes payable 762,750 90,771
Proceeds from notes payable related party
Stock issued for cash 1,475,145 3,584,511
Cash Flows Provided By Financing Activities 1,905,454 3,077,155

Effect of exchange rate changes on cash (109,104 ) -

Net (Decrease) Increase in Cash and Cash Equivalents (223,397 ) 1,627,953
Cash and Cash Equivalents at Beginning of Period 1,192,316 414,885
Cash and Cash Equivalents at End of Period $ 968,919 $ 2,042,838

Supplemental Cashflow Information:
Interest Paid $ 36,048 $ 101,027
Taxes Paid $ - $ -

Supplemental Non-Cash Disclosure
Discount on new notes $ 75,000 $ -
Shares issued for warrants issued $ 168,296 $ -
Shares issued for preferred conversions $ - $ -
Shares issued for debt conversion conversions $ - $ -
~~The accompanying footnotes are an integral part of these consolidated financial statements~~
7

Clean Energy Technologies, Inc.
Notes to Consolidated Financial Statements (Unaudited)

NOTE 1 – GENERAL

These unaudited interim consolidated financial statements as of and for the ~~six~~nine months ended ~~June~~September 30, 2022, reflect all adjustments which, in the opinion of management, are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented, in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.

These unaudited interim consolidated financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s fiscal year end December 31, 2021 report. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the ~~six~~nine months ended ~~June~~September 30, 2022 are not necessarily indicative of results for the entire year ending December 31, 2022.

The summary of significant accounting policies of Clean Energy Technologies, Inc. is presented to assist in the understanding of the Company’s financial statements. The financial statements and notes are representations of the Company’s management, who is responsible for their integrity and objectivity.

Corporate History

We were incorporated in California in July 1995 under the name Probe Manufacturing Industries, Inc. We redomiciled to Nevada in April 2005 under the name Probe Manufacturing, Inc. We manufactured electronics and provided services to original equipment manufacturers (OEMs) of industrial, automotive, semiconductor, medical, communication, military, and high technology products. On September 11, 2015 Clean Energy HRS, or “CE HRS”, our wholly owned subsidiary acquired the assets of Heat Recovery Solutions from General Electric International. In November 2015, we changed our name to Clean Energy Technologies, Inc.

Our principal executive offices are located at 2990 Redhill Avenue, Costa Mesa, CA 92626. Our telephone number is (949) 273-4990. Our common stock is listed on the OTCQB Markets under the symbol “CETY.”

Our internet website address is www.cetyinc.com and our subsidiary’s web site is www.heatrecoverysolutions.com The information contained on our websites are not incorporated by reference into this document, and you should not consider any information contained on, or that can be accessed through, our website as part of this document.

The Company has four reportable segments: Clean Energy HRS (HRS), CETY Europe, and the legacy electronic manufacturing services (Electronic Assembly) division and CETY ~~Honk~~Hong Kong.

Going Concern

The financial statements have been prepared on a going concern basis, which contemplates continuity of operations, realization of assets and liquidation of liabilities in the normal course of business. The Company had a total ~~stockholder’s deficit~~stockholder equity of $~~646,909~~166,173 and a working capital deficit of $~~3,208,372~~4,000,686 as of ~~June~~September 30, 2022. The company also had an accumulated deficit of $~~17,883,464~~18,763,939 as of ~~June~~September 30, 2022. Therefore, there is substantial doubt about the ability of the Company to continue as a going concern. There can be no assurance that the Company will achieve its goals and reach profitable operations and is still dependent upon its ability (1) to obtain sufficient debt and/or equity capital and/or (2) to generate positive cash flow from operations.

Plan of Operation

We develop renewable energy products and solutions and establish partnerships in renewable energy that make environmental and economic sense. Our mission is to be a segment leader in the Zero Emission Revolution by offering recyclable energy solutions, clean energy fuels and alternative electric power for small and mid-sized projects in North America, Europe, and Asia. We target sustainable energy solutions that are profitable for us, profitable for our customers and represent the future of global energy production.

Our principal businesses

Waste Heat Recovery Solutions – we recycle wasted heat produced in manufacturing, waste to energy and power generation facilities using our patented Clean Cycle^TM generator to create electricity which can be recycled or sold to the grid.

Waste to Energy Solutions - we convert waste products created in manufacturing, agriculture, wastewater treatment plants and other industries to electricity, renewable natural gas (“RNG”), hydrogen and bio char which are sold or used by our customers.

Engineering, Consulting and Project Management Solutions – We have expanded our legacy electronics and manufacturing business and plan to manufacture component parts for our Waste Heat Recovery and Waste to Energy business and to provide consulting services to municipal and industrial customers and Engineering, Procurement and Construction (EPC) companies so they can identify, design and incorporate clean energy solutions in their projects.

8

CETY HK

CETY HK consists of two business ventures in mainland China:(i) our LNG trading operations sourcing and suppling LNG to industries and municipalities. The LNG is principally used for heavy truck refueling stations and urban or industrial users in areas that do not have a connection to local LNG pipeline systems. We purchase large quantities of LNG from large wholesale LNG depots at fixed prices which are prepaid for in advance at a discount to market. We sell the LNG to our customers at prevailing daily spot prices for the duration of the contracts; and (ii) our planned joint venture with Shenzhen Gas, acquiring natural gas pipeline operator facilities, each primarily located in the southern part of Sichuan Province and portions of Yunnan Province. Our planned joint venture with Shenzhen Gas plans to acquire, with financing from Shenzhen Gas, natural gas pipeline operator facilities with the goal of aggregating and selling the facilities to Shenzhen Gas in the future. According to our Framework Agreement with Shenzhen Gas, we will be required to contribute $8$8 million to the joint venture. The terms of the joint venture are subject to the execution of definitive agreements.

NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

The summary of significant accounting policies of Clean Energy Technologies, Inc. (formerly Probe Manufacturing, Inc.) is presented to assist in the understanding of the Company’s financial statements. The financial statements and notes are representations of the Company’s management, who is responsible for their integrity and objectivity.

The consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include the accounts of the Company and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation.

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Such estimates may be materially different from actual financial results. Significant estimates include the recoverability of long-lived assets, the collection of accounts receivable and valuation of inventory and reserves.

Cash and Cash Equivalents

We maintain the majority of our cash accounts at JP Morgan Chase bank. The total cash balance is insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000, (which we may exceed from time to time) per commercial bank. For purposes of the statement of cash flows we consider all cash and highly liquid investments with initial maturities of one year or less to be cash equivalents.

Accounts Receivable

Our ability to collect receivables is affected by economic fluctuations in the geographic areas and industries served by us. Reserves for un-collectable amounts are provided, based on past experience and a specific analysis of the accounts. Although we expect to collect amounts due, actual collections may differ from the estimated amounts. As of ~~June~~September 30, 2022, and December 31, 2021, we had a reserve for potentially un-collectable accounts receivable of $75,000. Our policy for reserves for our long-term financing receivables is determined on a contract-by-contract basis and considers the length of the financing arrangement. As of ~~June~~September 30, 2022, and December 31, 2021, we had a reserve for potentially un-collectable long-term financing receivables of $247,500 and $247,500 respectively.

Four (4) customers accounted for approximately 98% of accounts receivable on ~~June~~September 30, 2022. Our trade accounts primarily represent unsecured receivables. Historically, our bad debt write-offs related to these trade accounts have been insignificant.

Lease asset

As of ~~June~~September 30, 2022, and December 31, 2021 we had a lease asset that was purchased from General Electric with a value of $1,309,527, however due the purchase price allocation, we recognized a value of $217,584. The lease is due to be commissioned in the first quarter of 2022 and will generate approximately $20,000 per month for 120 months. See note 3 for additional information.

Inventory

Inventories are valued at the lower of weighted average cost or market value. Our industry experiences changes in technology, changes in market value and availability of raw materials, as well as changing customer demand. We make provisions for estimated excess and obsolete inventories based on regular audits and cycle counts of our on-hand inventory levels and forecasted customer demands and at times additional provisions are made. Any inventory write offs are charged to the reserve account. As of ~~June~~September 30, 2022, and December 31, 2021, we had a reserve for potentially obsolete inventory of $321,104.

Property and Equipment

Property and equipment are recorded at cost. Assets held under capital leases are recorded at lease inception at the lower of the present value of the minimum lease payments or the fair market value of the related assets. The cost of ordinary maintenance and repairs is charged to operations. Depreciation and amortization are computed on the straight-line method over the following estimated useful lives of the related assets:
SCHEDULE OF PROPERTY AND EQUIPMENT ESTIMATED USEFUL LIVES
Furniture and fixtures 3 to 7 years
Equipment 7 to 10 years
Leasehold Improvements 7 years

9

Long –Lived Assets

Our management assesses the recoverability of its long-lived assets by determining whether the depreciation and amortization of ~~long lived~~long-lived assets over their remaining lives can be recovered through projected undiscounted future cash flows. The amount of long-lived asset impairment if any, is measured based on fair value and is charged to operations in the period in which long-lived assets impairment is determined by management. There can be no assurance however, that market conditions will not change or demand for our services will continue, which could result in impairment of long-lived assets in the future.

Revenue Recognition

The Company recognizes revenue under ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” (“ASC 606”).

Performance Obligations Satisfied Over Time

FASB ASC 606-10-25-27 through 25-29, 25-36 through 25-37, 55-5 through 55-10

An entity transfers control of a good or service over time and satisfies a performance obligation and recognizes revenue over time if one of the following criteria is met:

a. The customer receives and consumes the benefits provided by the entity’s performance as the entity performs (as described in FASB ASC 606-10-55-5 through 55-6).
b. The entity’s performance creates or enhances an asset (for example, work in process) that the customer controls as the asset is created or enhanced (as described in FASB ASC 606-10-55-7).
c. The entity’s performance does not create an asset with an alternative use to the entity (see FASB ASC 606-10-25-28), and the entity has an enforceable right to payment for performance completed to date (as described in FASB ASC 606-10-25-29).

Performance Obligations Satisfied at a Point in Time

FASB ASC 606-10-25-30

If a performance obligation is not satisfied over time, the performance obligation is satisfied at a point in time. To determine the point in time at which a customer obtains control of a promised asset and the entity satisfies a performance obligation, the entity should consider the guidance on control in FASB ASC 606-10-25-23 through 25-26. In addition, it should consider indicators of the transfer of control, which include, but are not limited to, the following:

a. The entity has a present right to payment for the asset
b. The customer has legal title to the asset
c. The entity has transferred physical possession of the asset
d. The customer has the significant risks and rewards of ownership of the asset
e. The customer has accepted the asset

A principal obtains control over any one of the following (ASC 606-10-55-37A):
a. A good or another asset from the other party which the entity then transfers to the customer. Note that momentary control before transfer to the customer may not qualify.
b. A right to a service to be performed by the other party, which gives the entity the ability to direct that party to provide the service to the customer on the entity’s behalf.
c. A good or service from the other party that it then combines with other goods or services in providing the specified good or service to the customer.

If the entity obtains control over one of the above before the good or service is transferred to a customer, the entity could be considered a principal.

The core principle of the revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. 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 goods and services transferred to the customer. In addition a) the company also does not have an alternative use for the asset if the customer were to cancel the contract, and b.) has a fully enforceable right to receive payment for work performed (i.e., customers are required to pay as various milestones and/or timeframes are met)

The following five steps are applied to achieve that core principle for our HRS and CETY Europe Divisions:

● Identify the contract with the customer

● Identify the performance obligations in the contract

● Determine the transaction price

● Allocate the transaction price to the performance obligations in the contract

● Recognize revenue when the company satisfies a performance obligation

10

The following steps are applied to our legacy engineering and manufacturing division:

● We generate a quotation

● We receive purchase orders from our customers.

● We build the product to their specification

● We invoice at the time of shipment

●
The terms are typically Net 30 days

The following step is applied to our CETY HK business unit:

● CETY HK is primarily responsible for fulfilling the contract / promise to provide the specified good or service.

Also, from time to time our contracts state that the customer is not obligated to pay a final payment until the units are commissioned, i.e. a final payment of 10%. As of ~~June~~September 30, 2022 and December 31, 2021 we had $33,000 and 33,000 of deferred revenue, which is expected to be recognized in the fourth quarter of year 2022.

Also, from time to time we require upfront deposits from our customers based on the contract. As of ~~June~~September 30, 2022 and December 31, 2021, we had outstanding customer deposits of $0 and $24,040 respectively.

Fair Value of Financial Instruments

The Financial Accounting Standards Board issued ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), “Fair Value Measurements and Disclosures” for financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:

● Level 1: Quoted prices in active markets for identical assets or liabilities.

● Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

● Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s derivative liabilities have been valued as Level 3 instruments. We value the derivative liability using a lattice model, with a volatility of 84% and using a risk free interest rate of 0.15%

The Company’s financial instruments consist of cash, prepaid expenses, inventory, accounts payable, convertible notes payable, advances from related parties, and derivative liabilities. The estimated fair value of cash, prepaid expenses, investments, accounts payable, convertible notes payable and advances from related parties approximate their carrying amounts due to the short-term nature of these instruments.

The carrying amounts of the Company’s financial instruments as of ~~June~~September 30, 2022 and December 31, 2021 reflect:
SCHEDULE OF FAIR VALUE OF CONVERTIBLE NOTES DERIVATIVE LIABILITY
Level 1 Level 2 Level 3 Total

Fair value of convertible notes derivative liability – June 30, 2022 $ – $ – $ 270,082 $ 270,082
Level 1 Level 2 Level 3 Total

Fair value of convertible notes derivative liability – September 30, 2022 $ – $ – $ 269,663 $ 269,663

Level 1 Level 2 Level 3 Total

Fair value of convertible notes derivative liability – December 31, 2021 $ – $ – $ 256,683 $ 256,683
Level 1 Level 2 Level 3 Total

Fair value of convertible notes derivative liability – December 31, 2021 $ – $ – $ 256,683 $ 256,683
Fair value of convertible notes derivative liability $ – $ – $ 256,683 $ 256,683

The carrying amount of accounts payable and accrued expenses are considered to be representative of their respective fair values because of the short-term nature of these financial ~~inst~~instruments.~~ruments.~~
Foreign Currency Translation and Comprehensive Income (Loss)

We have no material components of other comprehensive income (loss) and accordingly, net loss is equal to comprehensive loss in all periods. The accounts of the Company’s Chinese entities are maintained in RMB. The accounts of the Chinese entities were translated into USD in accordance with FASB ASC Topic 830 “Foreign Currency Matters.” All assets and liabilities were translated at the exchange rate on the balance sheet date; stockholders’ equity is translated at historical rates and the statements of operations and cash flows are translated at the weighted average exchange rate for the period. The resulting translation adjustments are reported under other comprehensive income (loss) in accordance with FASB ASC Topic 220, “Comprehensive Income.” Gains and losses resulting from foreign currency transactions are reflected in the statements of operations.

11

The Company follows FASB ASC Topic 220-10, “Comprehensive Income (loss).” Comprehensive income (loss) comprises net income (loss) and all changes to the statements of changes in stockholders’ equity, except those due to investments by stockholders, changes in additional paid-in capital and distributions to stockholders.

Equity Method Investment
In July 2022, JHJ and other three shareholders agreed to form and make total capital contribution of RMB 20 million ($2.81 million) with latest contribution due date in February 2066 into Sichuan Hongzuo Shuya Energy Limited (“Shuya”), JHK owns 20% of Shuya. In August 2022, JHJ purchased 100% ownership of Sichuan Shunengwei Energy Technology Limited (“SSET”) for $0, who owns 29% of Shuya; Shunengwei is a holding company and did not have any operations nor made any capital contribution into Shuya as of the ownership purchase date by JHJ; Right after the ownership purchase of SSET, JHJ ultimately owns 49% of Shuya.
Shuya was setup as the operating entity for pipeline natural gas (PNG) and compressed natural gas (CNG) trading business, while the other two shareholders of Shuaya have large supply relationships.
The Company has determined that Shuya is not a VIE and has evaluated its consolidation analysis under the voting interest model. Because the Company does not own greater than 50% of the outstanding voting shares, either directly or indirectly, it has accounted for its investment in Shuya under the equitymethod of accounting. Under this method, the investor (“JHJ”) recognizes its share of the profits and losses of the investee (“Shuya”) in the periods when these profits and losses are also reflected in the accounts of the investee. Any profit or loss recognized by the investing entity appears in its income statement. Also, any recognized profit increases the investment recorded by the investing entity, while a recognized loss decreases the investment.
JHJ made a capital contribution of RMB 3.91 million ($0.55 million) into Shuya during the three months ended September 30, 2022. Shuaya did not have any revenue yet but only incurred $27,836 operating expenses as of September 30, 2022; accordingly, JHJ recorded $13,640 investment loss from investment of Shuya for the three months ended September 30 ,2022. JHJ’s investment in Shuya was decreased to $536,994 as of September 30, 2022.
Net Profit (Loss) per Common Share

Basic profit / (loss) per share is computed on the basis of the weighted average number of common shares outstanding. At ~~June~~September 30, 2022, we had outstanding common shares of ~~966,675,946~~1,482,977,288 used in the calculation of basic earnings per share. Basic Weighted average common shares and equivalents for the three months ended ~~June~~September 30, 2022 and ~~June~~September 30, 2021 were ~~965,929,205~~1,482,977,288 and ~~895,498,243~~943,569,149 respectively. As of ~~June~~September 30, 2022, we had convertible notes, convertible into approximately ~~564,920,304~~84,016,076 of additional common shares,~~14,375,000~~23,472,222 common stock warrants. Fully diluted weighted average common shares and equivalents were withheld from the calculation for the three months ended ~~June~~September 30, 2022 and ~~June~~September 30, 2021 as they were considered anti-dilutive.

Research and Development

We had 0no amounts of research and development R&D expense during the three & ~~six~~nine months ended ~~June~~September 30, 2022 and 2021.

Segment Disclosure

FASB Codification Topic 280, Segment Reporting, establishes standards for reporting financial and descriptive information about an enterprise’s reportable segments. The Company has 4four reportable segments: Clean Energy HRS (HRS), CETY Europe and the legacy electronic manufacturing services division and CETY HK. The segments are determined based on several factors, including the nature of products and services, the nature of production processes, customer base, delivery channels and similar economic characteristics. Refer to note 1 for a description of the various product categories manufactured under each of these segments.

An operating segment’s performance is evaluated based on its pre-tax operating contribution, or segment income. Segment income is defined as net sales less cost of sales, and segment selling, general and administrative expenses, and does not include amortization of intangibles, stock-based compensation, other charges (income), net and interest and other, net.

Selected Financial Data:
SCHEDULE OF SEGMENT REPORTING
2022 2021 2022 2021
for the six months ended June 30 for the nine months ended
September 30
2022 2021 2022 2021
Net Sales
Manufacturing and Engineering 61,018 41,223 132,316 91,262
Clean Energy HRS 460,885 88,807 461,192 602,207
CETY HK 1,963,053 - 1,925,950 -
Cety Europe 38,012 161,128 48,138 173,234
Total Sales 2,522,968 291,158 2,567,596 866,703

Segment income and reconciliation before tax
Manufacturing and Engineering 38,475 29,683 85,352 72,853
Clean Energy HRS 413,646 62,802 427,219 312,118
CETY HK 643,239 - 631,082 -
Cety Europe 30,630 126,054 40,315 134,712
Total Segment income 1,125,990 218,539 1,183,968 519,683

Reconciling items
General and Administrative expense (201,303 ) (340,521 ) (284,025 ) (529,335 )
Salaries (390,892 ) (433,069 ) (587,928 ) (661,634 )
Travel (87,398 ) (40,354 ) (126,388 ) (66,735 )
Professional Fees (224,195 ) (82,209 ) (359,636 ) (123,383 )
Facility lease and Maintenance (173,480 ) (168,910 ) (260,262 ) (254,708 )
Consulting Subcontractors (62,051 ) (83,931 )
Depreciation and Amortization (15,038 ) (16,146 ) (22,557 ) (24,219 )
Change in derivative liability (13,399 ) 1,745,369 (12,980 ) 1,734,624
Other Income 14,258 - 25,790 -
Gain debt settlement 2,920 368,098 2,920 828,666
Interest Expense (416,275 ) (414,069 ) (747,451 ) (603,240 )
Net Loss before income tax (440,864 ) 836,728 (1,272,481 ) 819,719

12

Share-Based Compensation

The Company has adopted the use of Statement of Financial Accounting Standards No. 123R, “Share-Based Payment” (SFAS No. 123R) (now contained in FASB Codification Topic 718, Compensation-Stock Compensation), which supersedes APB Opinion No. 25, “Accounting for Stock Issued to Employees,” and its related implementation guidance and eliminates the alternative to use Opinion 25’s intrinsic value method of accounting that was provided in Statement 123 as originally issued. This Statement requires an entity to measure the cost of employee services received in exchange for an award of an equity instruments, which includes grants of stock options and stock warrants, based on the fair value of the award, measured at the grant date (with limited exceptions). Under this standard, the fair value of each award is estimated on the grant date, using an option-pricing model that meets certain requirements. We use the Black-Scholes option-pricing model to estimate the fair value of our equity awards, including stock options and warrants. The Black-Scholes model meets the requirements of SFAS No. 123R; however, the fair values generated may not reflect their actual fair values, as it does not consider certain factors, such as vesting requirements, employee attrition and transferability limitations. The Black-Scholes model valuation is affected by our stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. We estimate the expected volatility and estimated life of our stock options at grant date based on historical volatility. For the “risk-free interest rate,” we use the Constant Maturity Treasury rate on 90-day government securities. The term is equal to the time until the option expires. The dividend yield is not applicable, as the Company has not paid any dividends, nor do we anticipate paying them in the foreseeable future. The fair value of our restricted stock is based on the market value of our free trading common stock, on the grant date calculated using a 20-trading-day average. At the time of grant, the share-based compensation expense is recognized in our financial statements based on awards that are ultimately expected to vest using historical employee attrition rates and the expense is reduced accordingly. It is also adjusted to account for the restricted and thinly traded nature of the shares. The expense is reviewed and adjusted in subsequent periods if actual attrition differs from those estimates.

We re-evaluate the assumptions used to value our share-based awards on a quarterly basis and, if changes warrant different assumptions, the share-based compensation expense could vary significantly from the amount expensed in the past. We may be required to adjust any remaining share-based compensation expense, based on any additions, cancellations or adjustments to the share-based awards. The expense is recognized over the period during which an employee is required to provide service in exchange for the award—the requisite service period (usually the vesting period). No compensation cost is recognized for equity instruments for which employees do not render the requisite service. For the three months ended ~~June~~September 30, 2022 and 2021 we had $0 in share-based expense, due to the issuance of common stock. As of ~~June~~September 30, 2022, we had no further non-vested expense to be recognized.

Income Taxes

Federal Income taxes are not currently due since we have had losses since inception of Clean Energy Technologies.

On December 22, 2018 H.R. 1, originally known as the Tax Cuts and Jobs Act, (the “Tax Act”) was enacted. Among the significant changes to the U.S. Internal Revenue Code, the Tax Act lowers the U.S. federal corporate income tax rate (“Federal Tax Rate”) from 35% to 21% effective January 1, 2018. The Company will compute its income tax expense for the year ended December 31, 2022 using a Federal Tax Rate of 21% and an estimated state of California rate of 9%9%.

Income taxes are provided based upon the liability method of accounting pursuant to ASC 740-10-25 Income Taxes – Recognition. Under this approach, deferred income taxes are recorded to reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end. A valuation allowance is recorded against deferred tax assets if management does not believe the Company has met the “more likely than not” standard required by ASC 740-10-25-5.

Deferred income tax amounts reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes.

As of ~~June~~September 30, 2022, we had a net operating loss carry-forward of approximately $(~~9,067,587~~10,108,327) and a deferred tax asset of $~~2,720,276~~3,032,498 using the statutory rate of ~~30%~~30%. The deferred tax asset may be recognized in future periods, not to exceed 20 years. However, due to the uncertainty of future events we have booked valuation allowance of $(~~2,720,276~~3,032,498). FASB ASC 740 prescribes recognition threshold and measurement attributes for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FASB ASC 740 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. On ~~June~~September 30, 2022 the Company had not taken any tax positions that would require disclosure under FASB ASC 740.
SCHEDULE OF DEFERRED TAX ASSET

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Deferred Tax Asset $ 2,720,276 $ 2,556,982 $ 3,032,498 $ 2,556,982
Valuation Allowance (2,720,276 ) (2,556,982 ) (3,032,498 ) (2,556,982 )
Deferred Tax Asset (Net) $ - $ - $ - $ -

On February 13, 2018, Clean Energy Technologies, Inc., a Nevada corporation (the “Registrant” or “Corporation”) entered into a Common Stock Purchase Agreement (“Stock Purchase Agreement”) by and between MGW Investment I Limited (“MGWI”) and the Corporation. The Corporation received $907,388in exchange for the issuance of 302,462,667 restricted shares of the Corporation’s common stock, par value $.001 per share (the “Common Stock”).

13

On February 13,2018 the Corporation and Confections Ventures Limited. (“CVL”) entered into a Convertible Note Purchase Agreement (the “Convertible Note Purchase Agreement,” together with the Stock Purchase Agreement and the transactions contemplated thereunder, the “Financing”) pursuant to which the Corporation issued to CVL a convertible promissory Note (the “CVL Note”) in the principal amount of $939,500 with an interest rate of 10% per annum interest rate and a maturity date of February 13, 2020. The CVL Note is convertible into shares of Common Stock at $0.003per share, as adjusted as provided therein. This note was assigned to MGW Investments.

This resulted in a change in control, which limited the net operating to that date forward. We are subject to taxation in the U.S. and the states of California. Further, the Company currently has no open tax years’ subject to audit prior to December 31, 2015. The Company is current on its federal and state tax returns.

Reclassification

Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported income, total assets, or stockholders’ equity as previously reported.

Recently Issued Accounting Standards

The Company is reviewing the effects of following recent updates. The Company has no expectation that any of these items will have a material effect upon the financial statements.

Update 2021-03—Intangibles—Goodwill and Other (Topic 350): Accounting Alternative For Evaluating Triggering Events.

The amendments in this Update are effective on a prospective basis for fiscal years beginning after December 15, 2019. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance as of March 30, 2021.

Update 2021-01—Reference Rate Reform (Topic 848):

An entity may elect to apply the amendments in this Update on a full retrospective basis as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020.

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-13, Financial Instruments—Credit Losses [codified as Accounting Standards Codification Topic (ASC) 326]. ASC 326 adds to US generally accepted accounting principles (US GAAP) the current expected credit loss (CECL) model, a measurement model based on expected losses rather than incurred losses. Under this new guidance, an entity recognizes its estimate of expected credit losses as an allowance, which the FASB believes will result in more timely recognition of such losses. This will become effective in January 2023 and will have minimal impact on the company.

Update 2020-06—Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. We do not expect any material impact on our financials because of the adoption of this update.

NOTE 3 – ACCOUNTS AND NOTES RECEIVABLE
SCHEDULE OF ACCOUNTS AND NOTES RECEIVABLE

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Accounts Receivable $ 1,858,533 $ 768,032 $ 1,881,792 $ 768,032
Less reserve for uncollectable accounts (75,000 ) (75,000 ) (75,000 ) (75,000 )
Total $ 1,783,533 $ 693,032 $ 1,806,792 $ 693,032

Our Accounts Receivable is pledged to Nations Interbanc, our line of credit.
SCHEDULE OF LEASE RECEIVABLE ASSET
June 30, 2022 December 31, 2021
Lease asset $ 217,584 $ 217,584

September 30, 2022 December 31, 2021
Lease asset $ 217,584 $ 217,584

The Company is currently modifying the assets subject to lease to meet the provisions of the agreement, and as of ~~June~~September 30, 2022 any collection on the lease payments was not yet considered probable, resulting in no derecognition of the underlying asset and no net lease investments recognized on the sales-type lease pursuant to ASC 842-30-25-3.
SCHEDULE OF DERECOGNITION OF UNDERLYING ASSETS OF FINANCING RECEIVABLE

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Long-term financing receivables $ 932,270 $ 932,270 $ 932,270 $ 932,270
Less Reserve for uncollectable accounts (247,500 ) (247,500 ) (247,500 ) (247,500 )
Long-term financing receivables - net $ 684,770 $ 684,770 $ 684,770 $ 684,770

On a contract by contract basis or in response to certain situations or installation difficulties, the Company may elect to allow non-interest bearing repayments in excess of 1 year.

Our long term financing Receivable are pledged to Nations Interbanc, our line of credit.

14

NOTE 4 – INVENTORY

Inventories by major classification were comprised of the following at:
SCHEDULE OF INVENTORIES

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Inventory $ 808,979 $ 783,296 $ 849,053 $ 783,296
Less reserve for uncollectable accounts (321,104 ) (321,104 )
Less reserve (321,104 ) (321,104 )
Total $ 487,875 $ 462,192 $ 527,949 $ 462,192

Our Inventory is pledged to Nations Interbanc, our line of credit.

NOTE 5 – PROPERTY AND EQUIPMENT

Property and equipment were comprised of the following at:
SCHEDULE OF PROPERTY AND EQUIPMENT

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Property and Equipment $ 1,354,824 $ 1,354,824 $ 1,354,824 $ 1,354,824
Leasehold Improvements 75,436 75,436 75,436 75,436
Accumulated Depreciation (1,406,344 ) (1,397,244 ) (1,410,894 ) (1,397,244 )
Net Fixed Assets $ 23,916 $ 33,016 $ 19,366 $ 33,016

Our Depreciation Expense for the three months ended ~~June~~September 30, 2022 and 2021 was $~~4,550~~7,519 and $~~5,104~~8,073 respectively.

Our Property Plant and Equipment is pledged to Nations Interbanc, our line of credit.

NOTE 6 – INTANGIBLE ASSETS

Intangible assets were comprised of the following at:
SCHEDULE OF INTANGIBLE ASSETS

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Goodwill $ 747,976 $ 747,976 $ 747,976 $ 747,976
LWL Intangibles $ 1,468,709 $ 1,468,709 $ 1,468,709 $ 1,468,709
License 354,322 354,322 354,322 354,322
Patents 190,789 115,569 190,789 115,569
Accumulated Amortization (81,158 ) (75,220 ) (84,127 ) (75,220 )
Net Fixed Assets $ 2,680,638 $ 2,611,356 $ 2,677,669 $ 2,611,356

Our Amortization Expense for the ~~six~~nine months ended ~~June~~September 30, 2022 and 2021 was $~~2,969~~22,557 and $ ~~2,969~~ 24,219respectively.

Based on the foregoing analysis of the facts surrounding the Company’s acquisition of LWL, it is the Company’s position that the Company is the acquirer of LWL, under the acquisition method of accounting.

As such, as of November 8, 2021 (the acquisition date), the Company recognized, separately from goodwill, the identifiable assets acquired and the liabilities assumed in the Business combination.

The following table presents the purchase price allocation:
SCHEDULE OF BUSINESS ACQUISITION PURCHASE PRICE ALLOCATION

Consideration:
Cash and cash equivalents $ 1,500,000

Total purchaser consideration $ 1,500,000

Assets acquired:
Cash and cash equivalents $ 6,156
Prepayment $ 13,496
Other receivable $ 20,000
Trading Contracts $ 146,035
Shenzhen Gas Relationship $ 1,314,313
Total assets acquired $ 1,508,539

Liabilities assumed:
Advance Receipts $ (8,539 )
Taxes Payable $ 179
Net Assets Acquired: $ 1,500,000

If LWL reach USD 5 million in revenue or net profit of USD 1 million by December 31, 2022, then based on the performance contingency there will be issuance of 20,000,000 shares of CETY to the Seller. As of the date of the filing the performance contingencies have not been met.

15

NOTE 7 – CONVERTIBLE NOTE RECEIVABLE

Effective January 10, 2022, JHJ (“note holder”) entered a convertible note agreement with Chengdu Rongjun Enterprise Consulting Co., Ltd (“Rongjun” or “the borrower”) with maturity on January 10, 2025. Under this convertible note, JHJ lent RMB 5,000,000 ($0.78 million) to Rongjun with annual interest rate of 12%, calculated from the Issuance Date until all outstanding interest and principal is paid in full. The Borrower may pre-pay principal or interest on this Note at any time prior to the maturity date, without penalty. JHJ has the right to convert this note directly or indirectly into shares or equity interest of Heze Hongyuan Natural Gas Co., Ltd (“Heze”) equal to 15% of Heze’s outstanding Equity Interest. Rongjun owns 90% of Heze. During the three months ended, JHJ recorded $17,961 interest income from this note.

NOTE 8 – ACCRUED EXPENSES
SCHEDULE OF ACCRUED EXPENSES
June 30, 2022 December 31, 2021
Accrued Wages $ 69,007 $ 22,950
Accrued Interest and other 72,556 120,897
Accrued Interest and other $ 141,563 $ 143,847

September 30, 2022 December 31, 2021
Accrued Wages $ 68,219 $ 22,950
Accrued Interest and other 56,612 143,847
Accrued Interest and other $ 124,830 $ 166,797
NOTE 9 – NOTES PAYABLE

The Company issued a short-term note payable to an individual, secured by the assets of the Company, dated September 6, 2013 in the amount of $50,000 and fixed fee amount of $3,500. As of December 31, 2019, the outstanding balance was $36,500. On January 30, 2020 we issued 1,700,000 shares of our common stock at a purchase price of $.02 per share, as settlement in full of a note payable of in the amount of $36,500 with accrued interest of $19,721. As a result, we recognized a gain in the amount of $22,221 in the 1^stquarter of 2021.

On November 11, 2013, we entered into an accounts receivable financing agreement with American Interbanc (now Nations Interbanc). Amounts outstanding under the agreement bear interest at the rate of 2.5% per month. It is secured by the assets of the Company. In addition, it is personally guaranteed by Kambiz Mahdi, our Chief Executive Officer. As of June 30, 2022, the outstanding balance was $1,109,812.75 compared to $1,169,638 at December 31, 2021.

On April 1, 2021, we entered into an amendment to the purchase order financing agreement with DHN Capital, LLC dba Nations Interbanc. Nations Interbanc has lowered the accrued fees balance by $275,000.00 as well as the accrual rate to 2.25% per 30 days. As a result, CETY has agreed to remit a minimum monthly payment of $50,000 by the final calendar day of each month.

On September 11, 2015, our CE HRS subsidiary issued a promissory note in the initial principal amount $1,400,000 and assumed a pension liability of $100,000, for a total liability of $1,500,000, in connection with our acquisition of the heat recovery solutions, or HRS, assets of General Electric International, Inc., a Delaware corporation (“GEII”), including intellectual property, patents, trademarks, machinery, equipment, tooling and fixtures. The note bears interest at the rate of 2.66% per annum. The note is payable on the following schedule: (a) $200,000 in principal on December 31, 2015 and (b) thereafter, the remaining principal amount of $1,200,000, together with interest thereon, payable in equal quarterly instalments of principal and interest of $157,609, commencing on December 31, 2016 and continuing until December 31, 2019, at which time the remaining unpaid principal amount of this note and all accrued and unpaid interest thereon shall be due and payable in full.

Total Liability to GE
SCHEDULE OF NOTES PAYABLE

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Note payable GE $ 1,200,000 $ 1,200,000 $ 1,200,000 $ 1,200,000
Accrued transition services 972,233 972,233 972,233 972,233
Accrued Interest 353,803 325,843 367,783 325,843
Total $ 2,526,036 $ 2,498,076 $ 2,540,016 $ 2,498,076

We are currently in default on the payment of the purchase price pursuant to our asset purchase agreement with General Electric due to our belief that we are entitled to a reduction in purchase price we paid due to the misunderstanding of the asset valuation.

On May 4, 2020 the company entered in to a payroll protection loan, with Comerica bank, guaranteed by the SBA due May 4, 2022 for $110,700, with an interest rate of 1%. This note payment is due in full on May 4, 2022 and also has the possibility of forgiveness. This note was forgiven on July 1, 2021.

On February 4 , 2021 the company entered in to a payroll protection loan, with Comerica bank, guaranteed by the SBA due February 4, 2023 for $89,200, with an interest rate of 1%. This note payment is due in full on February 4, 2023 and also has the possibility of forgiveness. As of the date of this filing this note has been forgiven. This note was forgiven on July 26, 2021.

16

On September 7, 2021 the company entered into a promissory note in the amount of $226,345, with and interest rate of 10% per annum and a default interest rate of 22% per annum. This note is due in full on September 7, 2022 and has mandatory monthly payments of $23,828. The note had an OID of $23,345 and recorded as finance fee expense. In the event of the default, at the option of the Investor, the note may be converted into shares of common stock of the company. This is note is convertible, but not until a contingent event of default has taken place, none of which have occurred as of the date of this filing. The balance on this note as of June 30, 2022 was $23,828.44. This note was paid off as of July 5, 2022.

On September 28, 2021 the company entered into a promissory note in the amount of $142,720, with and interest rate of 10% per annum and a default interest rate of 22% per annum. This note is due in full on September 28, 2022 and has mandatory monthly payments of $15,003. The note had an OID of $14,720 and recorded as finance fee expense. In the event of the default, at the option of the Investor, the note may be converted into shares of common stock of the company. This is note is convertible, but not until a contingent event of default has taken place, none of which have occurred as of the date of this filing. The balance on this note as of June 30, 2022 was $30,006. This note was paid off as of July 13, 2022.

On March 10, 2022 the company entered into a promissory note in the amount of $170,600, with and interest rate of 10% per annum and a default interest rate of 22% per annum. This note is due in full on March 10, 2023 and has mandatory monthly payments of $18,766. The note had an OID of $17,060 and recorded as finance fee expense. In the event of the default, at the option of the Investor, the note may be converted into shares of common stock of the company. This is note is convertible, but not until a contingent event of default has taken place, none of which have occurred as of the date of this filing. The balance on this note as of June 30, 2022 was $170,060.

On June 30, 2022 the company entered into a promissory note in the amount of $252,928.44 with and interest rate of 10% per annum and a default interest rate of 22% per annum. This note is due in full on June 30, 2023 and has mandatory monthly payments of $27,822.13. The note had an OID of $25,293 and recorded as finance fee expense. In the event of the default, at the option of the Investor, the note may be converted into shares of common stock of the company. This is note is convertible, but not until a contingent event of default has taken place, none of which have occurred as of the date of this filing. The balance on this note as of September 30, 2022 was $222,577.30
On July 13, 2022 the company entered into a promissory note in the amount of $159,450 with and interest rate of 10% per annum and a default interest rate of 22% per annum. This note is due in full on July 13, 2023 and has mandatory monthly payments of $17,539.50. The note had an OID of $16,447.00 and recorded as finance fee expense. In the event of the default, at the option of the Investor, the note may be converted into shares of common stock of the company. This is note is convertible, but not until a contingent event of default has taken place, none of which have occurred as of the date of this filing. The balance on this note as of September 30, 2022 was $140,316
Convertible notes

On May 5, 2017 we entered into a nine-month convertible note payable for $78,000, which accrues interest at the rate of 12% per annum. It is not convertible until three months after its issuance and has a conversion rate of sixty one percent (61%) of the lowest closing bid price (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. On November 6, 2017 this note was assumed and paid in full at a premium for a total of $116,600by Cybernaut Zfounder Ventures. An amended term were added to the original note with the interest rate of 14%. This note matured on February 21^st of 2018and is currently in default. As of ~~June~~September 30, 2022, the outstanding balance due was $91,600.

On May 24, 2017 we entered into a nine-month convertible note payable for $32,000, which accrues interest at the rate of 12% per annum. It is not convertible until three months after its issuance and has a conversion rate of fifty-five eight percent (58%) of the lowest closing bid price (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. On November 6, 2017 this note was assumed and paid in full at a premium for a total of $95,685, by Cybernaut Zfounder Ventures. An amended term was added to the original note with the interest rate of 14%. This note matured on February 26^th, 2018and is currently in default. As of ~~June~~September 30, 2022, the outstanding balance due was $95,685

On October 30, 2019 we entered into a convertible note payable for $103,000, with a maturity date of October 30, 2020, which accrues interest at the rate of 12% per annum. It is convertible six months after its issuance and has a conversion rate of sixty-five percent (65%) of the average of the two lowest closing prices (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. We also entered into a stock purchase agreement for the potential conversion into common stock. This note was paid in full on May 1, 2020.

On January 8, 2020 we entered into a convertible note payable for $103,000, with a maturity date of January 8, 2021, which accrues interest at the rate of 12% per annum. It is convertible six months after its issuance and has a conversion rate of sixty-five percent (65%) of the average of the two lowest closing prices (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. We also entered into a stock purchase agreement for the potential conversion into common stock. Subsequently The fair value of the convertible feature was $87,560, we recorded a debt discount of $87,560. On July 7, 2020 this note was paid in full.

On February 19, 2020 we entered into a convertible note payable for $53,000, with a maturity date of February 19, 2021, which accrues interest at the rate of 12% per annum. It is convertible six months after its issuance and has a conversion rate of sixty-five percent (65%) of the average of the two lowest closing prices (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. We also entered into a stock purchase agreement for the potential conversion into common stock. On August 18, 2020 this note was paid in full.

17

On July 6, 2020, Clean Energy Technologies, Inc. (the “Company) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with LGH Investments, LLC (the “Investor”), pursuant to which the Company issued to the Investor a convertible promissory note (the “Note”) in the original principal amount of $164,800, a Warrant (the “Warrant”) to purchase 1,500,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”) and one million (1,000,000) restricted shares of Common Stock (“Commitment fee Shares”). The Note carried an original issue discount of $4,800 with interest of 8% per annum payable at maturity. The Note matures 8 months from the issue date and is convertible at any time into the Common Stock at a conversion price equal to $0.02 per share, subject to adjustment. The shares were valued on the date of issuance using the stock price on that day for a total value of $19,211. We also recognized a debt discount of $17,861. We amortized $3,234 of the debt discount during the three months ended September 30, 2020. The unamortized debt discount as of September 30, 2020 was $14,267. This note was fully converted as of December 31, 2020. This note was converted into 14,035,202 shares of common stock, for a total of $171,229 including principal of 164,800 plus a accrued interest of $6,429. Also on January 12, 2021 the company issued 697,861shares of its common stock as redemptions of $27,914 in cashless warrants.

On July 15, 2020 we entered into a convertible note payable for $128,000, with a maturity date of July 15, 2021, which accrues interest at the rate of 12% per annum. It is convertible six months after its issuance and has a conversion rate of sixty-five percent (65%) of the average of the two lowest closing prices (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. We also entered into a stock purchase agreement for the potential conversion into common stock. This note was paid in full on October 16, 2020.

On August 17, 2020, Clean Energy Technologies, Inc. (the “Company) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with LGH Investments, LLC (the “Investor”), pursuant to which the Company issued to the Investor a convertible promissory note (the “Note”) in the original principal amount of $103,000, a Warrant (the “Warrant”) to purchase 1,500,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”) and one million (1,000,000) restricted shares of Common Stock (“Commitment fee Shares”). The Note carried an original issue discount of $3,000 with interest of 8% per annum payable at maturity. The Note matures 8 months from the issue date and is convertible at any time into the Common Stock at a conversion price equal to $0.02 per share, subject to adjustment. The shares were valued on the date of issuance using the stock price on that day for a total value of $19,211. We also recognized a debt discount of $17,861. We amortized $14,627 of the debt discount during the six months ended June 30, 2021. The unamortized debt discount as of June 30, 2022 was $0. This note was paid in full on January 8, 2021.

On September 10, 2020 we entered into a convertible note payable for $63,000, with a maturity date of July 15, 2021, which accrues interest at the rate of 11% per annum. It is convertible six months after its issuance and has a conversion rate of sixty-five percent (65%) of the average of the two lowest closing prices (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. We also entered into a stock purchase agreement for the potential conversion into common stock. This note was paid in full on January 15, 2021.

On October 14, 2020 Clean Energy Technologies, Inc. (the “Company) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with Firstfire Global Opportunities Fund LLC, (the “Investor”), pursuant to which the Company issued to the Investor a convertible promissory note (the “Note”) in the original principal amount of $168,000, a Warrant (the “Warrant”) to purchase 1,500,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”) and 1,250,000 restricted shares of Common Stock (“Commitment fee Shares”). The Note carried an original issue discount of $8,000 with interest of 8% per annum payable at maturity. The Note matures 8 months from the issue date and is convertible at any time into the Common Stock at a conversion price equal to $0.02 per share, subject to adjustment. The shares were valued on the date of issuance using the stock price on that day for a total value of $24,282. We also recognized a debt discount of $24,282. We amortized $19,093 of the debt discount during the three months ended March 31, 2021. The unamortized debt discount as of March 31, 2022 was $0. On January 29, 2021 this note was paid in full. Also on January 12, 2021 the company issued 697,861shares of its common stock as redemptions of $27,914 in cashless warrants.

On November 10, 2020 we entered into a convertible note payable for $53,000, with a maturity date of November 10, 2021, which accrues interest at the rate of 11% per annum. It is convertible six months after its issuance and has a conversion rate of sixty-five percent (65%) of the average of the two lowest closing prices (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. We also entered into a stock purchase agreement for the potential conversion into common stock. On February 11, 2021 this note was paid in full.

On December 18, 2020 we entered into a convertible note payable for $83,500, with a maturity date of December 18, 2021, which accrues interest at the rate of 11% per annum. It is convertible six months after its issuance and has a conversion rate of sixty-five percent (65%) of the average of the two lowest closing prices (as reported by Bloomberg LP) of our common stock for the fifteen (15) Trading Days immediately preceding the date of conversion. We also entered into a stock purchase agreement for the potential conversion into common stock. On March 11, 2021 this note was paid in full.

On December 27, 2021, we entered into a convertible note payable with Universal Scope Inc. for $650,000 with a maturity date of June 21, 2022, which accrues interest at the rate of 2% per annum. It is convertible at any time after its issuance and has fix conversion rate of $0.06 of our common stock.

18

On May 6, 2022, we entered into a Securities Purchase Agreement with Mast Hill, L.P. (Mast Hill”) pursuant to which the Company issued to Mast Hill a $750,000 Convertible Promissory Note, due May 6, 2023 (the “Note”) for a purchase price of $675,000.00 plus an original issue discount in the amount of $75,000.00, and an interest rate of fifteen percent (15%) per annum. Mast Hill Fund is entitled to purchase 9,375,000 shares of commons stock per the warrant agreement at the exercise price of $0.04. The Securities Purchase Agreement provides customary representations, warranties and covenants of the Company and Mast Hill as well as providing Mast Hill with registration rights.

On August 5, 2022, we entered into a Securities Purchase Agreement with Jefferson Street Capital, LLC (Jefferson) pursuant to which the Company issued to Jefferson a $138,888 Convertible Promissory Note, due August 5, 2023 (the “Note”) for a purchase price of $125,000.00 plus an original issue discount in the amount of $13,888.88, and an interest rate of fifteen percent (15%) per annum. Jefferson is entitled to purchase 1,736,111 shares of commons stock per the warrant agreement at the exercise price of $0.04. The Securities Purchase Agreement provides customary representations, warranties and covenants of the Company and Jefferson as well as providing Jefferson with registration rights.
On August 17, 2022, we entered into a Securities Purchase Agreement with Firstfire Global Opportunities Fund LLC (“Firstfire”) pursuant to which the Company issued to Mast Hill a $150,000 Convertible Promissory Note, due August 17, 2023 (the “Note”) for a purchase price of $135,000.00 plus an original issue discount in the amount of $15,000.00, and an interest rate of fifteen percent (15%) per annum. Firstfire is entitled to purchase 1,875,000 shares of commons stock per the warrant agreement at the exercise price of $0.04. The Securities Purchase Agreement provides customary representations, warranties and covenants of the Company and Firstfire as well as providing Firstfire with registration rights.
On September 1, 2022, we entered into a Securities Purchase Agreement with Pacific Pier Capital, LLC (Pacific) pursuant to which the Company issued to Pacific a $138,888 Convertible Promissory Note, due August 5, 2023 (the “Note”) for a purchase price of $125,000.00 plus an original issue discount in the amount of $13,888.88, and an interest rate of fifteen percent (15%) per annum. Pacific is entitled to purchase 1,736,111 shares of commons stock per the warrant agreement at the exercise price of $0.04. The Securities Purchase Agreement provides customary representations, warranties and covenants of the Company and Pacific as well as providing Pacific with registration rights.
On September 16, 2022, we entered into a Securities Purchase Agreement with Mast Hill, L.P. (Mast Hill”) pursuant to which the Company issued to Mast Hill a $300,000 Convertible Promissory Note, due September 16, 2023 (the “Note”) for a purchase price of $270,000.00 plus an original issue discount in the amount of $30,000.00, and an interest rate of fifteen percent (15%) per annum. Mast Hill Fund is entitled to purchase 3,750,000 shares of commons stock per the warrant agreement at the exercise price of $0.04. The Securities Purchase Agreement provides customary representations, warranties and covenants of the Company and Mast Hill as well as providing Mast Hill with registration rights.
Total due to Convertible Notes
SCHEDULE OF CONVERTIBLE NOTES

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Total convertible notes $ 1,127,771 $ 1,109,890 $ 2,301,053 $ 1,109,890
Accrued Interest 123,480 110,370 194,105 110,370
Debt Discount - (437,044 ) (26,919 )
Total $ 1,251,251 $ 1,220,260 $ 2,495,158 $ 1,193,341

Note 10 – Derivative Liabilities

As a result of the convertible notes we recognized the embedded derivative liability on the date of note issuance. We also revalued the remaining derivative liability on the outstanding note balance on the date of the balance sheet. We value the derivative liability using a binomial lattice model with an expected volatility range of 70% to 84%, a risk-free interest rate range of 0.15%, an exercise price range of $.0245 to $.0258 and a stock price of $.033. The remaining derivative liabilities were:
SCHEDULE OF FAIR VALUE OF DERIVATIVE LIABILITY

June 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Derivative Liabilities on Convertible Loans:
Outstanding Balance $ 270,082 $ 256,683 $ 269,663 $ 256,683

NOTE 11 – COMMITMENTS AND CONTINGENCIES

Operating Rental Leases

As of May 1, 2017, our corporate headquarters are located at 2990 Redhill Unit A, Costa Mesa, CA. On March 10, 2017, the Company signed a lease agreement for a 18,200-square foot CTU Industrial Building. Lease term is seven years and two months beginning July 1, 2017. Future minimum lease payments for the years ending December 31, are: In October of 2018 we signed a sublease agreement with our facility in Italy with an indefinite term that may be terminated by either party with a 60-day notice for 1,000 Euro per month. Due to the short termination clause, we are treating this as a month-to-month ~~lease.~~lease.

As of ~~June~~September 30, 2022
SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS

Year Lease Payment Lease Payment
2022 120,942 61,922
2023 191,903 191,903
Imputed Interest (14,047 ) (7,024 )
Net Lease Liability $ 298,798 $ 246,801

Our lease expense for the ~~six~~nine months ended ~~June~~September 30, 2022, and 2021 was $~~173,480~~260,262 and $~~168,910~~254,708 respectively.

ASB ASU 2016-02 “Leases (Topic 842)” – In February 2016, the FASB issued ASU 2016-02, which requires lessees to recognize almost all leases on their balance sheet as a right-of-use asset and a lease liability. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Classification will be based on criteria that are largely similar to those applied in current lease accounting, but without explicit bright lines. Lessor accounting is similar to the current model, but has been updated to align with certain changes to the lessee model and the new revenue recognition standard. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We have adopted the above ASU as of January 1, 2019. The right of use asset and lease liability have been recorded at the present value of the future minimum lease payments, utilizing a 5% average borrowing rate and the company is utilizing the transition relief and “running off” on current leases.

Severance Benefits

Mr. Mahdi will receive a severance benefit consisting of a single lump sum cash payment equal the salary that Mr. Mahdi would have been entitled to receive through the remainder or the Employment Period or One (1) year, whichever is greater.

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NOTE 12 – CAPITAL STOCK TRANSACTIONS

On April 21, 2005, our Board of Directors and shareholders approved the re-domicile of the Company in the State of Nevada, in connection with which we increased the number of our authorized common shares to 200,000,000 and designated a par value of $.001 per share.

On May 25, 2006, our Board of Directors and shareholders approved an amendment to our Articles of Incorporation to authorize a new series of preferred stock, designated as Series C, and consisting of 15,000 authorized shares.

On June 30, 2017, our Board of Directors and shareholders approved an increase in the number of our authorized common shares to 400,000,000 and in the number of our authorized preferred shares to 10,000,000. The amendment effecting the increase in our authorized capital was filed and effective on July 5, 2017.

On August 28, 2018, our Board of Directors and shareholders approved an increase in the number of our authorized common shares to 800,000,000. The amendment effecting the increase in our authorized capital was filed and effective on August 23, 2018.

On June 10, 2019, our Board of Directors and shareholders approved an increase in the number of our authorized common shares to 2,000,000,000. The amendment effecting the increase in our authorized capital was effective on September 27, 2019

Common Stock Transactions

On July 6, 2020, Clean Energy Technologies, Inc. (the “Company) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with LGH Investments, LLC (the “Investor”), pursuant to which the Company issued to the Investor a convertible promissory note (the “Note”) in the original principal amount of $164,800, a Warrant (the “Warrant”) to purchase 1,500,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”) and one million (1,000,000) restricted shares of Common Stock (“Commitment fee Shares”). On December 31, 2020 this note was converted into 14,035,202 shares of common stock, for a total of $171,229 including principal of 164,800 plus a accrued interest of $6,429 as a result this note was paid in full. Also on January 12, 2021 the company issued 697,861shares of its common stock as redemptions of $27,914 in cashless warrants.

On July 23, 2020 we issued 3,000,000 shares of our common stock at a price of $.04 per share, in exchange for the conversion of 1,200 shares of our Series D Preferred Stock.

On August 17, 2020, Clean Energy Technologies, Inc. (the “Company) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with LGH Investments, LLC (the “Investor”), pursuant to which the Company issued to the Investor a convertible promissory note (the “Note”) in the original principal amount of $103,000, a Warrant (the “Warrant”) to purchase 1,500,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”) and one million (1,000,000) restricted shares of Common Stock (“Commitment fee Shares”). The Note carried an original issue discount of $3,000 with interest of 8% per annum payable at maturity. The Note matures 8 months from the issue date and is convertible at any time into the Common Stock at a conversion price equal to $0.02 per share, subject to adjustment. The shares were valued on the date of issuance using the stock price on that day for a total value of $19,211. We also recognized a debt discount of $17,861. We amortized $14,627 of the debt discount during the six months ended June 30, 2021. The unamortized debt discount as of March 31, 2022 was $0. This note was paid in full on January 8, 2021. Also on February 5, 2021 the company issued 1,100,000 shares of its common stock as redemptions of $44,000 in cashless warrants.

On October 14, 2020 Clean Energy Technologies, Inc. (the “Company) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with Firstfire Global Opportunities Fund LLC, (the “Investor”), pursuant to which the Company issued to the Investor a convertible promissory note (the “Note”) in the original principal amount of $168,000, a Warrant (the “Warrant”) to purchase 1,500,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”) and 1,250,000 restricted shares of Common Stock (“Commitment fee Shares”). These shares were issued on February 1, 2021 and 547,468.00 shares were issued as a result of exercise of the warrants on May 28, 2021. This note was paid in full as of January 29, 2021.

On February 5, 2021 we issued 3,000,000 shares of our common stock at a price of $.08 per share, in exchange for the conversion of 1,200 shares of our Series D Preferred Stock.

On February 9, 2021 we issued 2,275,662 shares of our common stock share, in exchange for the conversion of $182,052 of accrued dividend for the series D Preferred Stock.

On February 9, 2021 we issued 2,000,000 shares of our common stock at a price of $.04 per share, in exchange for the conversion of 800 shares of our Series D Preferred Stock.

On February 23, 2021 we issued 3,754,720 of common stock at a purchase price of $.014 per share and 3,754,720 of warrant at purchase price of 0.04 for an aggregate price of $52,566 to an accredited investor in a private sale. An additional 36,283 shares were issued as a result of a correction made to the original transaction.

On March 5, 2021 we issued 8,333,333 of common stock at a purchase price of $.06 per share for an aggregate price of $500,000 to an accredited investor in a private sale.

On March 10, 2021 we issued 32,125,000 units of common stock at a purchase price of $.08 per share for an aggregate price of $2,570,000 to an accredited investor in a private sale.

20

On March 12, 2021 we issued 1,625,000 shares and 2,068,588 of our common stock at a price of $.08 per share, in exchange for the conversion of 650 shares of our Series D Preferred Stock and 165,487 of accrued dividend for the series D preferred stock.

On September 2, 2021, Clean Energy Technology, Inc., a Nevada corporation (the “Company”), entered into an Equity Financing Agreement (“Equity Financing Agreement”) and Registration Rights Agreement (“Registration Rights Agreement”) with GHS Investments LLC, a Nevada limited liability company (“GHS”). Under the terms of the Equity Financing Agreement, GHS agreed to provide the Company with up to $4,000,000 upon effectiveness of a registration statement on Form S-1 (the “Registration Statement”) filed with the U.S. Securities and Exchange Commission (the “Commission”) As a result we issued 1,142,459 Shares of common stock as an commitment fee, which was valued and expense in the amount of $47,699. On October 14, 2021, this Form S-1 became ~~effective.~~effective.

On September 13, 2021 we issued 1,100,630 shares of common stock for a correction of a previous issuance error.

During the year ended December 31, 2021, we issued 9,842,072 shares of common stock, under S-1 registration statement with GHS for a total of $294,016 in net proceeds and expensed $96,334 in legal and financing fees as a result.

On December 31, 2021 we issued 9,833,750 shares of our common stock under our Reg A offering at $.08 per share. These shares are unrestricted and free trading.

During the quarter ended March 31, 2022, we issued 3,155,865 shares of common stock, under S-1 registration statement with GHS for a total of $134,755 in net proceeds and expensed $45,498 in legal and financing fees as a result.

On February 21, 2022, we issued 15,035,000 shares of our common stock under our Reg A offering at $.08 per share. These shares are unrestricted and free trading.

During the April of 2022, we issued 4,915,644 shares of common stock, under S-1 registration statement with GHS for a total of $153,324 in net proceeds and expensed $34,500 in legal and financing fees as a result.

On September 21, 2022 MGW I converted $1,548,904 from the outstanding balance of their convertible note into 516,301,343 shares of company’s common stock.
Common Stock

Our Articles of Incorporation authorize us to issue 2,000,000,000 shares of common stock, par value $0.001 per share. As of ~~June~~Sept 30, 2022 there were ~~966,675,946~~1,482,977,289 shares of common stock outstanding. All outstanding shares of common stock are, and the common stock to be issued will be, fully paid and non-assessable. Each share of our common stock has identical rights and privileges in every respect. The holders of our common stock are entitled to vote upon all matters submitted to a vote of our shareholders and are entitled to one vote for each share of common stock held. There are no cumulative voting rights.

The holders of our common stock are entitled to share equally in dividends and other distributions that our Board of Directors may declare from time to time out of funds legally available for that purpose, if any, after the satisfaction of any prior rights and preferences of any outstanding preferred stock. If we liquidate, dissolve or wind up, the holders of common stock shares will be entitled to share ratably in the distribution of all of our assets remaining available for distribution after satisfaction of all our liabilities and our obligations to holders of our outstanding preferred stock.

Preferred Stock

Our Articles of Incorporation authorize us to issue 20,000,000 shares of preferred stock, par value $0.001 per share. Our Board of Directors has the authority to issue additional shares of preferred stock in one or more series, and fix for each series, the designation of and number of shares to be included in each such series. Our Board of Directors is also authorized to set the powers, privileges, preferences, and relative participating, optional or other rights, if any, of the shares of each such series and the qualifications, limitations or restrictions of the shares of each such series.

Unless our Board of Directors provides otherwise, the shares of all series of preferred stock will rank on parity with respect to the payment of dividends and to the distribution of assets upon liquidation. Any issuance by us of shares of our preferred stock may have the effect of delaying, deferring or preventing a change of our control or an unsolicited acquisition proposal. The issuance of preferred stock also could decrease the amount of earnings and assets available for distribution to the holders of common stock or could adversely affect the rights and powers, including voting rights, of the holders of common stock.

We previously authorized 440 shares of Series A Convertible Preferred Stock, 20,000 shares of Series B Convertible Preferred Stock, and 15,000 shares Series C Convertible Preferred Stock. As of August 20, 2006, all series A, B, and C preferred had been converted into common stock.

Effective August 7, 2013, our Board of Directors designated a series of our preferred stock as Series D Preferred Stock, authorizing 15,000 shares. Our Series D Preferred Stock offering terms authorized us to raise up to $1,000,000 with an over-allotment of $500,000 in multiple closings over the course of six months. We received an aggregate of $750,000 in financing in subscription for Series D Preferred Stock, or 7,500 ~~shares.~~shares.

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The following are primary terms of the Series D Preferred Stock. The Series D Preferred holders were initially entitled to be paid a special monthly divided at the rate of 17.5% per annum. Initially, the Series D Preferred Stock was also entitled to be paid special dividends in the event cash dividends were not paid when scheduled. If the Company does not pay the dividend within five (5) business days from the end of the calendar month for which the payment of such dividend to owed, the Company will pay the investor a special dividend of an additional 3.5%. Any unpaid or accrued special dividends will be paid upon a liquidation or redemption. For any other dividends or distributions, the Series D Preferred Stock participates with common stock on an as-converted basis. The Series D Preferred holders may elect to convert the Series D Preferred Stock, in their sole discretion, at any time after a one year (1) year holding period, by sending the Company a notice to convert. The conversion rate is equal to the greater of $0.08 or a 20% discount to the average of the three (3) lowest closing market prices of the common stock during the ten (10) trading day period prior to conversion. The Series D Preferred Stock is redeemable from funds legally available for distribution at the option of the individual holders of the Series D Preferred Stock commencing any time after the one (1) year period from the offering closing at a price equal to the initial purchase price plus all accrued but unpaid dividends, provided, that if the Company gave notice to the investors that it was not in a financial position to redeem the Series D Preferred, the Company and the Series D Preferred holders are obligated to negotiate in good faith for an extension of the redemption ~~period.~~period. The Company timely notified the investors that it was not in a financial position to redeem the Series D Preferred and the Company and the investors have engaged in ongoing negotiations to determine an appropriate extension period. The Company may elect to redeem the Series D Preferred Stock any time at a price equal to initial purchase price plus all accrued but unpaid dividends, subject to the investors’ right to convert, by providing written notice about its intent to redeem. Each investor has the right to convert the Series D Preferred Stock at least ten (10) days prior to such redemption by the Company.

In connection with the subscriptions for the Series D Preferred, we issued series F warrants to purchase an aggregate of 375,000 shares of our common stock at $.10 per share and series G warrants to purchase an aggregate of 375,000 shares of our common stock at $.20 per share.

On August 21, 2014, a holder holding 5,000 shares of Preferred Series D Preferred agreed to lower the dividend rate to 13% on its Series D Preferred. In September 2015, all holders of Series D Preferred signed and delivered estoppel agreements, whereby the holders agreed, among other things, that the Series D Preferred was not in default and to reduce (effective as of December 31, 2015) the dividend rate on the Series D Preferred Stock to six percent per annum and to terminate the 3.5% penalty in respect of unpaid dividends accruing on or after such ~~date.~~date.

In the first quarter of 2019, we signed agreements to issue 4,000,000 shares of common stock valued at $.015 for a total value of $60,000 for the conversion of 800 preferred series D shares , which were subsequently issued.

We also recorded a $60,000 commitment fee in exchange for the “stand off” and estoppel agreement and discounted conversion terms to account for the difference in the fair value which we offset to retained earnings.

On February 4, 2020 we issued 2,000,000 shares of our common stock at a price of $.04 per share, in exchange for the conversion of 800 shares of our Series D Preferred Stock.

On July 23, 2020 we issued 3,000,000 shares of our common stock at a price of $.04 per share, in exchange for the conversion of 1,200 shares of our Series D Preferred Stock.

On February 5, 2021 we issued 3,000,000 shares of our common stock at a price of $.08 per share, in exchange for the conversion of 1,200 shares of our Series D Preferred Stock.

On February 9, 2021 we issued 2,275,662 shares of our common stock share, in exchange for the conversion of $182,052 of accrued dividend for the series D Preferred Stock.

On February 9, 2021 we issued 2,000,000 shares of our common stock at a price of $.04 per share, in exchange for the conversion of 800 shares of our Series D Preferred Stock.

On March 12, 2021 we issued 3,693,588 shares of our common stock together with accrued preferred dividend at a price of $.08 per share, in exchange for the conversion of 1300 shares of our Series D Preferred Stock and accrued preferred dividend.

Warrants

A summary of warrant activity for the periods is as follows:

On July 6, 2020, Clean Energy Technologies, Inc. (the “Company) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with LGH Investments, LLC (the “Investor”), pursuant to which the Company issued to the Investor a convertible promissory note (the “Note”) in the original principal amount of $164,800, a Warrant (the “Warrant”) to purchase 1,500,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”) and one million (1,000,000) restricted shares of Common Stock (“Commitment fee Shares”). The Note carried an original issue discount of $4,800 with interest of 8% per annum payable at maturity. The Note matures 8 months from the issue date and is convertible at any time into the Common Stock at a conversion price equal to $0.02 per share, subject to adjustment. On January 8, 2021, the cashless warrants were converted into 697,861 shares of our common stock.

22

On August 17, 2020, Clean Energy Technologies, Inc. (the “Company) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with LGH Investments, LLC (the “Investor”), pursuant to which the Company issued to the Investor a convertible promissory note (the “Note”) in the original principal amount of $103,000, a Warrant (the “Warrant”) to purchase 1,500,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”) and one million (1,000,000) restricted shares of Common Stock (“Commitment fee Shares”). The Note carried an original issue discount of $3,000 with interest of 8% per annum payable at maturity. The Note matures 8 months from the issue date and is convertible at any time into the Common Stock at a conversion price equal to $0.02 per share, subject to adjustment. On February 1, 2021 the cashless warrants were converted into 1,100,000 shares of our common stock.

On February 23, 2021 we issued 3,754,720 of common stock at a purchase price of $.014 per share and 3,754,720 of warrant at purchase price of 0.04 for an aggregate price of $52,566 to an accredited investor in a private sale. An additional 36,283 shares were issued as a result of a correction made to the original transaction. These warrants expire on February 23, ~~2022.~~2022.

On May 6, 2022, we issued 9,375,000of warrant shares in connection with the issuance of the promissory note in the principal amount of $750,000.00to Mast Hill Fund at the exercise price per share of 0.04.
However, that if the Company consummates an Uplist Offering on or before the date that is one hundred eighty (180) calendar days after the Issuance Date, then the Exercise Price shall equal 120% of the offering price per share of Common Stock.
On August 5, 2022, we issued 1,736,111 of warrant shares in connection with the issuance of the promissory note in the principal amount of $138,889 to Jefferson Street at the exercise price per share of 0.04. However, that if the Company consummates an Uplist Offering on or before the date that is one hundred eighty (180) calendar days after the Issuance Date, then the Exercise Price shall equal 120% of the offering price per share of Common Stock.
On August 17, 2022, we issued 1,875,000 of warrant shares in connection with the issuance of the promissory note in the principal amount of $150,000 to First Fire at the exercise price per share of 0.04. However, that if the Company consummates an Uplist Offering on or before the date that is one hundred eighty (180) calendar days after the Issuance Date, then the Exercise Price shall equal 120% of the offering price per share of Common Stock.
On September 1, 2022, we issued 1,736,111 of warrant shares in connection with the issuance of the promissory note in the principal amount of $138,889 to Pacific Pier at the exercise price per share of 0.04. However, that if the Company consummates an Uplist Offering on or before the date that is one hundred eighty (180) calendar days after the Issuance Date, then the Exercise Price shall equal 120% of the offering price per share of Common Stock.
On September 16, 2022, we issued 3,750,000 of warrant shares in connection with the issuance of the promissory note in the principal amount of $300,000 to Mast Hill Fund at the exercise price per share of 0.04. However, that if the Company consummates an Uplist Offering on or before the date that is one hundred eighty (180) calendar days after the Issuance Date, then the Exercise Price shall equal 120% of the offering price per share of Common Stock.
SCHEDULE OF WARRANT ACTIVITY

Warrants -
Common
Share
Equivalents

Weighted
Average
Exercise
price

Warrants
exercisable -
Common
Share
Equivalents

Weighted
Average
Exercise price
Warrants -
Common
Share
Equivalents Weighted
Average
Exercise
price Warrants
exercisable -
Common
Share
Equivalents Weighted
Average
Exercise price
Outstanding December 31, 2021 8,754,720 $ 0.04 8,754,720 $ 0.04 8,754,720 $ 0.04 8,754,720 $ 0.04
Expired 3,754,720 3,754,720 0.04 3,754,720 3,754,720 0.04
Exercised
Issued
9,375,000
18,472,222
Outstanding June 30, 2022 14,375,000 $ 0.04 5,000,000 $ 0.04
Outstanding September 30, 2022 23,472,222 $ 0.04 5,000,000 $ 0.04

Stock Options

We currently have no outstanding stock options.

NOTE 13 – RELATED PARTY TRANSACTIONS

Kambiz Mahdi, our Chief Executive Officer, owns Billet Electronics, which is distributor of electronic components. From time to time, we purchase parts from Billet Electronics. In addition, Billet was a supplier of parts and had dealings with current and former customers of the Company prior to joining the company. The amount of parts purchases in the 13^strdt quarter of 2022 was $~~8,180~~9351. Our Board of Directors has approved the transactions between Billet Electronics and the Company.

On November 2, 2016, we effected the repayment of the convertible note dated March 15, 2016 for an aggregate amount of $84,000. Concurrently, we entered into an Escrow Funding Agreement with Red Dot Investment, Inc., a California corporation (“Reddot”), pursuant to which Reddot deposited funds into escrow to fund the repayment and we assigned to Reddot our right to acquire the convertible note and Reddot acquired the convertible note. Concurrently, we and Reddot amended the convertible note (a) to have a fixed conversion price of $.005 per share, subject to potential further adjustment in the event of certain Common Stock issuances, (b) to have a fixed interest rate of ten percent (10%) per annum with respect to both the redemption amount and including a financing fee and any costs, expenses, or other fees relating to the convertible note or its enforcement and collection, and any other expense for or on our account (in each case with a minimum 10% yield in the event of payoff or conversion within the first year), such amounts to constitute additional principal under the convertible note, as amended, and (c) as otherwise provided in the Escrow Funding Agreement. The March 2016 convertible note, as so amended, is referred to as the “Master Note.”

Concurrently with the foregoing note repayments, we entered into a Credit Agreement and Promissory Note (the “Credit Agreement”) with Megawell USA Technology Investment Fund I LLC, a Wyoming limited liability company in formation (“MW I”), pursuant to which MW I deposited funds into escrow to fund the repayment of the convertible notes and we assigned to MW I our right to acquire the convertible notes and otherwise agreed that MW I would be subrogated to the rights of each note holder to the extent a note was repaid with funds advanced by MW I. Concurrently, MW I acquired the Master Note and we agreed that all amounts advanced by MG I to or for our benefit would be governed by the terms of the Master Note, including the payment of a financing fees, interest, minimum interest, and convertibility. Reddot is MW I’s agent for purposes of administration of the Credit Agreement and the Master Note and advances thereunder.

On February 13, 2018 the Corporation and Confections Ventures Limited. (“CVL”) entered into a Convertible Note Purchase Agreement (the “Convertible Note Purchase Agreement,” together with the Stock Purchase Agreement and the transactions contemplated thereunder, the “Financing”) pursuant to which the Corporation issued to CVL a convertible promissory Note (the “CVL Note”) in the principal amount of $939,500 with an interest rate of 10% per annum interest rate and a maturity date of February 13, 2020. The CVL Note is convertible into shares of Common Stock at $0.003per share, as adjusted as provided therein. As a result we recognized a beneficial conversion feature of $532,383, which is amortized over the life of the note. This note was assigned to MGW Investments and they agreed not to convert the $939,500 note in to shares in excess of the 800,000,000 Authorized limit until we have increased the Authorized shares to the Board approved limit of 2 billion shares. This note converted into 1,385,764 of company’s common stock on September 21, 2022.

23

On February 8, 2018 the Corporation entered a Convertible Promissory Note in the principal amount of $153,123, due October 8, 2018, with an interest rate of 12% per annum payable to MGWI (the “MGWI Note”). The MGWI Note is convertible into shares of the Corporation’s common stock at the lower of: (i) a 40% discount to the lowest trading price during the previous twenty (20) trading days to the date of a Conversion Notice; or (ii) 0.003. As a result of the closing of the transactions contemplated by the Stock Purchase Agreement and Convertible Note Purchase Agreement, the MGWI Note must be redeemed by the Corporation in an amount that will permit CVL and MGWI and their affiliates to hold 65% of the issued and outstanding Common Stock of the Corporation on a fully diluted ~~basis.~~basis. The proceeds from the MGWI Note were used to redeem the convertible note of the Corporation to JSJ Investments, Inc. in the principal amount of $103,000 with an interest rate of 12% per annum, due April 25, 2018. At December 31, 2019 the holder of this note beneficially owned 70% of the company and this note is not convertible if the holder holds more than 9.99%, as a result, we did not recognize a derivative liability or a beneficial conversion ~~feature.~~feature. This note was converted into 54,380,010 of company’s common stock on September 21, 2022.

Subsequently on May 11^th this note was amended and the maturity date was extended to October 8, 2023, and the restriction on the conversion of the note was removed if the holder of this note holds over 9.9% of the Company’s common stock.On June 24, 2021 MGW I converted $75,000 of the outstanding balance of this note into 25,000,000 shares of company’s common stock

On May 31, 2019, we entered into a subscription agreement pursuant to which the Company agreed to sell 168,000,000 units (each a “Unit” and together the “Units”) to MGW Investment I Limited MGWI for an aggregate purchase price of $1,999,200, or $.0119 per Unit, with each unit consisting of one share of common stock, par value $.001 per share (the “Common Stock”) and a warrant (the “Warrant”) to purchase one share of common stock. The Common Stock will be issued to MGWI at such time as the Company increases the number of shares of its authorized Common Stock. The Warrant is exercisable at $.04 per share of Common Stock and expires one year from the date of the Agreement.

In the fourth quarter of 2019 MGW Investment I Limited, advanced $167,975 with no terms or interest rate. The outstanding balance on this advance on ~~June~~September 30, 2022 is $~~167,975~~163,580.

On March 24, 2021, the Company transferred $500,000 to MGWI, an affiliate of the majority stockholder of the Company to hold in trust for our investment in two planned ventures in China. The ~~two potential investments are still pending.~~investment was used for the acquisition of LWL.

On ~~June 24, 2021~~September 21, 2022 MGW I converted $~~75,000~~1,548,904 from the outstanding balance of their convertible note into ~~25,000,000~~516,301,343 shares of company’s common stock.

Note 14 - WARRANTY LIABILITY

For the quarter ended ~~June~~September 30, 2022, and for the year ended December 31, 2021 there was 0no change in our warranty liability. We estimate our warranty liability based on past experiences and estimated replacement cost of material and labor to replace the critical turbine in the units that are still under warranty.

NOTE 15 – NON-CONTROLLING INTEREST

On June 24, 2021 the Company formed CETY Capital LLC a wholly owned subsidiary of CETY. In addition, the company established CETY Renewables Ashfield LLC (“CRA”) a wholly owned subsidiary of Ashfield Renewables Ag Development LLC(“ARA”) with our partner, Ashfield AG (“AG”). The purpose of the joint venture iswas for the development of a pyrolysis plant established to convert woody feedstock into electricity and BioChar by using high temperature ablative fast pyrolysis reactor for which Clean Energy Technology, Inc. holds the license for. The CRA is located in Ashfield, Massachusetts. Based upon the terms of the members’ agreement, the CETY Capital LLC ~~owns~~owned a 75% interest and AG ~~owns~~owned a 25% interest in Ashfield Renewables Ag Development LLC. The agreement with CETY Renewables Ashfield has been ~~terminated and we are in the process of negotiating a new agreement.~~terminated.

The consolidated financial statements ~~reflect 100% of~~have deconsolidated the ~~assets and liabilities~~CRA business unit. The Liabilities of CRA ~~and report the current non-controlling interest of AG. The full results of CRA operations are reflected~~has been transferred to Vermont Renewable Gas LLC (“VRG”), a newly formed entity. CETY retains 49% equity in ~~the statement of income with the elimination of the non-controlling interest identified.~~VRG.

NOTE 16 – THE STATUTORY RESERVES

The Company’s ability to pay dividends primarily depends on it receiving funds from its subsidiaries. PRC laws and regulations permit payments of dividends by the Company’s PRC subsidiaries only out of the subsidiary’s retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The results of operations reflected in the financial statements prepared in accordance with US GAAP differ from those reflected in the statutory financial statements of the Company’s PRC subsidiaries.

In accordance with the PRC Regulations on Enterprises with Foreign Investment and their articles of association, a foreign-invested enterprise (“FIE”) established in the PRC is required to provide statutory reserves, which are appropriated from net profit as reported in the FIE’s PRC statutory accounts. An FIE is required to allocate at least 10% of its annual after-tax profit to the surplus reserve until such reserve reaches 50% of its respective registered capital based on the FIE’s PRC statutory accounts. Appropriations to other funds are at the discretion of the BOD for all FIEs. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. Additionally, shareholders of an FIE are required to contribute capital to satisfy the registered capital requirement of the FIE. Until such contribution of capital is satisfied, the FIE is not allowed to repatriate profits to its shareholders, unless otherwise approved by the State Administration of Foreign Exchange.

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Additionally, in accordance with the Company Laws of the PRC, a domestic enterprise is required to provide surplus reserve at least 10% of its annual after-tax profit until such reserve has reached 50% of its respective registered capital based on the enterprise’s PRC statutory accounts. A domestic enterprise is also required to have a discretionary surplus reserve, at the discretion of the BOD, from the profits determined in accordance with the enterprise’s PRC statutory accounts. Appropriation to such reserve by the Company is based on profit arrived at under PRC accounting standards for business enterprises for each year. The profit arrived at must be set off against any accumulated losses sustained by the Company in prior years, before allocation is made to the statutory reserve. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. Technology was established as domestic enterprises and therefore are subject to the above-mentioned restrictions on distributable profits.

As a result of these PRC laws and regulations that require annual appropriations of 10% of after-tax income to be set aside prior to payment of dividends as general reserve fund, the Company’s PRC subsidiaries are restricted in their ability to transfer a portion of their net assets to the Company as a dividend.

In addition, according to Administrative Measures for the Collection and Utilization of Enterprise Work Safety Funds issued by the PRC Ministry of Finance and the State Administration of Work Safety, for the companies with dangerous goods production or storage, the company is required to make a special reserve for the use of enhancing and improving its safe production conditions. Under PRC GAAP, the reserve is recorded as selling expense; however, under US GAAP, since the expense has not been incurred and the Company will record cost of sales for safety related expenses when it is actually happened or incurred, this special reserve was recorded as an appropriation of its after-tax income. The reserve is calculated at a rate of 15% of total sales.

NOTE 17 – SUBSEQUENT EVENTS

On ~~June 30,~~October 25, 2022 the company entered into a promissory note in the amount of $~~252,928.44~~114,850 with and interest rate of 10% per annum and a default interest rate of 22% per annum. This note is due in full on ~~June 30,~~October 25, 2023 and has mandatory monthly payments of $~~27,822.13~~12,633.50. The note had an OID of $~~25,293~~11,850.00 and recorded as finance fee expense. In the event of the default, at the option of the Investor, the note may be converted into shares of common stock of the company. This is note is convertible, but not until a contingent event of default has taken place, none of which have occurred as of the date of this filing. The balance on this note as of ~~June~~September 30, 2022 was $~~252,928.44~~114,850.

~~On July 13, 2022 the company entered into a promissory note in the amount of $159,450~~ ~~with and interest rate of~~ 10~~% per annum and a~~ ~~default interest rate of 22%~~ ~~per annum. This note is due in full on~~ ~~July 13, 2023~~ ~~and has mandatory monthly payments of $17,539.50. The note had an OID of $16,447.00~~ and recorded as finance fee expense. In the event of the default, at the option of the Investor, the note may be converted into shares of common stock of the company. This is note is convertible, but not until a contingent event of default has taken place, none of which have occurred as of the date of this filing.
On ~~August 12,~~November 11, 2022, ~~Clean Energy Technology, Inc., a Nevada corporation (the “Company”),~~we entered into a Securities Purchase Agreement with ~~Jefferson Street Capital, LLC (“Jefferson”~~Mast Hill, L.P. (Mast Hill”) pursuant to which the Company issued to ~~Jefferson~~Mast Hill a $~~138,888.88~~95,000 Convertible Promissory Note, due ~~August 5,~~November 11, 2023 (the “Note”) for a purchase price of $~~125,000.00~~85,500.00 plus an original issue discount in the amount of $~~13,888.88~~9,500.00, and an interest rate of fifteen percent (1515%%) per annum. ~~The Company issued Jefferson a five year warrant (“Warrant”)~~Mast Hill Fund is entitled to purchase ,~~1,736,111~~1,187,500shares of ~~Common Stock in connections with~~commons stock per the ~~transactions described above.~~warrant agreement at the exercise price of $0.04
.
~~On August 17, 2022, Clean Energy Technology, Inc., a Nevada corporation (the “Company”), entered into a~~The Securities Purchase Agreement ~~with First Fire Global Opportunities Fund, LLC (“Firstfire”) pursuant to which~~provides customary representations, warranties and covenants of the Company ~~issued to Firstfire a $150,000.00~~ ~~Convertible Promissory Note, due August 17, 2023 (the “Note”) for a purchase price of $135,000.00~~ ~~plus an original issue discount in the amount of $15,000.00~~, and ~~an interest rate of fifteen percent (~~15~~%) per annum. The Company issued Firstfire a five-year warrant (“Warrant”) to purchase~~ ~~1,875,000~~ ~~shares of Common Stock in connections~~Mast Hill as well as providing Mast Hill with ~~the transactions described above.~~registration rights.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

FORWARD-LOOKING STATEMENTS

This Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements. You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms. These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements. Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

Description of the Company

We specialize in renewable energy & energy efficiency systems design, manufacturing and project implementation. We were incorporated in California in July 1995 under the name Probe Manufacturing Industries, Inc. We redomiciled to Nevada in April 2005 under the name Probe Manufacturing, Inc. We provided engineering and manufacturing electronics services to original equipment manufacturers (OEMs) of clean energy, industrial, automotive, semiconductor, medical, communication, military, and high technology products.

With the vision to combat climate change and creating a better, cleaner and environmentally sustainable future, we formed Clean Energy HRS, LLC a wholly owned subsidiary of Clean Energy Technologies, Inc. and acquired the assets of Heat Recovery Solutions from General Electric International on September 11, 2015. In November 2015, we changed our name to Clean Energy Technologies, Inc. Our principal executive offices are located at 2990 Redhill Avenue, Costa Mesa, CA 92626. We have 12 full time employees. All employees and overhead are shared between Clean Energy Technologies, Inc. (which still provides the contract electronic manufacturing services) and Clean Energy HRS, LLC.

Clean Energy Technologies, Inc. established a new company CETY Europe, SRL (CETY Europe) as a wholly owned subsidiary. CETY Europe is a Sales and Service Center in Silea (Treviso), Italy established in 2017. The service center became operational in November 2018. Their offices are located at Alzaia Sul Sile, 26D, 31057 Silea (TV) and the have 1 full time employee.

Clean Energy Technologies, Inc. established a wholly owned subsidiary called CETY Capital, a financing arm of CETY to fund captive renewable energy projects producing low carbon energy. CETY Capital will add flexibility to the capacity CETY offers its customers and fund projects utilizing its products and clean energy solutions.

CETY Capital retains ~~75%~~49% ownership interest in ~~Ashfield Renewables Ag Development~~Vermont Renewable Gas LLC ~~which has~~ established ~~CETY Renewables Ashfield LLC a wholly owned low carbon energy company developing~~to develop a biomass ~~plant.~~plant in Vermont utilizing CETY’s High Temperature Ablative Pyrolysis system.

Clean Energy Technologies (H.K.) Limited., a wholly owned subsidiary of Clean Energy Technologies Inc. acquired 100% ownership of Leading Wave Limited a liquid natural gas trading company in China.

The Company has four reportable segments: Clean Energy HRS (HRS), and CETY Europe, CETY Renewables, ~~Ashfield,~~ CETY HK and the legacy engineering and manufacturing services division.

Business Overview

General

The Company’s business and operating results are directly affected by changes in overall customer demand, operational costs and performance and leverage of our fixed cost and selling, general and administrative (“SG&A”) infrastructure.

Product sales fluctuate in response to several factors including many that are beyond the Company’s control, such as general economic conditions, interest rates, government regulations, consumer spending, labor availability, and our customers’ production rates and inventory levels. Product sales consist of demand from customers in many different markets with different levels of cyclicality and seasonality.

Operating performance is dependent on the Company’s ability to manage changes in input costs for items such as raw materials, labor, and overhead operating costs. Performance is also affected by manufacturing efficiencies, including items such as on time delivery, quality, scrap, and productivity. Market factors of supply and demand can impact operating costs

In December 2019, a novel strain of coronavirus (COVID-19) was reported in Wuhan, China and has spread throughout the United States and the rest of the world. The World Health Organization has declared the outbreak to constitute a “Public Health Emergency of International Concern.” This contagious disease outbreak, which has not been contained, and is disrupting supply chains and affecting production and sales across a range of industries in United States and other companies as a result of quarantines, facility closures, and travel and logistics restrictions in connection with the outbreak, as well as the worldwide adverse effect to workforces, economies and financial markets, leading to a global economic downturn. Therefore, the Company expects this matter to negatively impact its operating results. However, the related financial impact and duration cannot be reasonably estimated at this time.

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Who We Are

We develop renewable energy products and solutions and establish partnerships in renewable energy that make environmental and economic sense. Our mission is to be a segment leader in the Zero Emission Revolution by offering recyclable energy solutions, clean energy fuels and alternative electric power for small and mid-sized projects in North America, Europe, and Asia. We target sustainable energy solutions that are profitable for us, profitable for our customers and represent the future of global energy production.

Our principal businesses

Waste Heat Recovery Solutions – we recycle wasted heat produced in manufacturing, waste to energy and power generation facilities using our patented Clean Cycle^TM generator to create electricity which can be recycled or sold to the grid.

Waste to Energy Solutions - we convert waste products created in manufacturing, agriculture, wastewater treatment plants and other industries to electricity, renewable natural gas (“RNG”), hydrogen and bio char which are sold or used by our customers.

Engineering, Consulting and Project Management Solutions – we bring a wealth of experience in developing clean energy projects for municipal and industrial customers and Engineering, Procurement and Construction (EPC) companies so they can identify, design and incorporate clean energy solutions in their projects.

CETY HK

Clean Energy Technologies (H.K.) Limited (“CETY HK”) consists of two business ventures in mainland China:(i) our liquefied natural gas (“LNG”) trading operations sourcing and suppling LNG to industries and municipalities. The LNG is principally used for heavy truck refueling stations and urban or industrial users in areas that do not have a connection to local LNG pipeline systems. We purchase large quantities of LNG from large wholesale LNG depots at fixed prices which are prepaid for in advance at a discount to market. We sell the LNG to our customers at prevailing daily spot prices for the duration of the contracts; and (ii) our planned joint venture with a large state-owned gas enterprise in China called Shenzhen Gas (Hong Kong) International Co. Ltd. (“Shenzhen Gas”), acquiring natural gas pipeline operator facilities, each primarily located in the southern part of Sichuan Province and portions of Yunnan Province. Our planned joint venture with Shenzhen Gas plans to acquire, with financing from Shenzhen Gas, natural gas pipeline operator facilities with the goal of aggregating and selling the facilities to Shenzhen Gas in the future. According to our Framework Agreement with Shenzhen Gas, we will be required to contribute $8 million to the joint venture. The terms of the joint venture are subject to the execution of definitive agreements.

Business and Segment Information

We design, produce and market clean energy products and integrated solutions focused on energy efficiency and renewable energy. Our aim is to become a leading provider of renewable and energy efficiency products and solutions by helping commercial companies and municipalities reduce energy waste and emissions, lower energy costs and generate incremental revenue by providing electricity, renewable natural gas and biochar to the grid.

Segment Information

Our four segments for accounting purposes are:

Clean Energy Solutions - our Waste Heat Recovery Solutions, Waste to Energy Solutions, China LNG initiatives and Engineering and Consulting Services which are the core offerings of our business.

CETY Europe – our subsidiary established in Italy for the purposes of servicing our customers in the EU that we are required to report as a separate accounting entity.

Electronic Manufacturing Business - our legacy electronics manufacturing business that do not contribute significantly to our revenues or business plan that we are required to report as a separate accounting entity.

CETY HK – which is the parent company of our LNG trading operations in China that source and supply LNG and our planned joint venture to acquire LNG distribution systems depots and transmission systems. Prior to the first quarter of 2022, the Company had three reportable segments but added the CETY HK segment to reflect its recent new businesses in China.

Summary of Operating Results the ~~six~~three months ~~Ended June~~ended September 30, 2022 Compared to the same period in 2021

Going Concern

The financial statements have been prepared on a going concern basis, which contemplates continuity of operations, realization of assets and liquidation of liabilities in the normal course of business. The Company had a total stockholder’s ~~deficit~~equity of ~~$646,909~~$166,173 and a working capital deficit of ~~$3,208,372~~$4,000,686 as of ~~June~~September 30, 2022 The company also had an accumulated deficit of ~~$17,883,464~~$18,763,939 as of ~~June~~September 30, 2022 and used ~~$1,233,918~~$1,016,545 in net cash from operating activities for the ~~six~~three months ended ~~June~~September 30, 2022. Therefore, there is substantial doubt about the ability of the Company to continue as a going concern. There can be no assurance that the Company will achieve its goals and reach profitable operations and is still dependent upon its ability (1) to obtain sufficient debt and/or equity capital and/or (2) to generate positive cash flow from operations.

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The ~~six~~three months ended ~~June~~September 30, 2022; we had a net loss of ~~$459,531~~$540,986 compared to a net ~~profit~~loss of ~~$836,728~~$277,664 for the same period in 2021. The increase in the net ~~profit~~loss in ~~2021~~2022 was mainly due to the increase in ~~gain on derivative~~professional fees including legal & accounting due to the expenses associated with the IPO up listing to NASDAQ and lower sales in ~~2021,~~the quarter. The three months ended ~~June~~September 30, 2022; our revenue was ~~$1,747,701~~$44,629 compared to $155,884 for the same period in 2021. For the six months ended June 30, 2022, our gross margin was 45% compared to 75% for the same period in 2021. For the six months ended June 30, 2022, our operating expense was $1,154,358 compared to $1,081,209$575,545 for the same period in 2021. For the three months ended ~~June~~September 30, ~~2022; we had a loss from operations of $43,537~~2022, our gross margin was 58% compared to ~~a net loss from operations of 495,733~~52% for the same period in 2021. For the three months ended September 30, 2022, our operating expense was $566,899 compared to $578,808 for the same period in 2021.

See note 1 to the notes to the financial statements for a discussion on critical accounting policies

RELATED PARTY TRANSACTIONS

See note 13 to the notes to the financial statements for a discussion on related party transaction
Results of the three month ended September 30, 2022, Compared to the nine month ended September 30, 2021
Net Sales
Segment breakdown
The three months ended September 30, 2022, our revenue from Engineering and Manufacturing was $71,298 compared to $50,040 for the same period in 2021.
The three months ended September 30, 2022, our revenue from HRS was $307 compared to $513,400 for the same period in 2021. This decrease was mainly because of delay with the passing of inflation reduction act and the incentives associated with heat recovery solution and delays with supply chain.
The three months ended September 30, 2022, our revenue from CETY Europe was $10,125 compared to $12,105 for the same period in 2021.
The three months ended September 30, 2022, our revenue from our wholly owned subsidiary CETY HK was $0.0 due to lack of availability of natural gas during the quarter compared to $0 for the same period in 2021.This is a s a result of the acquisition of JHJ gas company made in November of 2021. We started to generate revenue from this entity in the 1^st quarter of 2022.
Gross Profit
The three months ended September 30, 2022; our gross profits were $25,913 compared to $301,144 for the same period in 2021. The decrease in gross profit was due to lower revenues.
Segment breakdown
The three months ended September 30, 2022, our gross profit from Engineering and Manufacturing was $46,876 compared to $43,216 for the same period in 2021.
The three months ended September 30, 2022, we had negative gross profit from HRS of $18,146 compared to $250,500 for the same period in 2021. The decrease from the HRS segment was mainly due to 0 revenue in the third quarter of 2022.
The three months ended September 30, 2022, our gross profit from CETY Europe was $9,685 compared to $4,101 for the same period in 2021. The increase in gross profit was due higher service revenue.
The three months ended September 30, 2022, our gross profit from our wholly owned subsidiary CETY HK was negative $12,158 compared to $0 for the same period in 2021. We had zero revenue from CETY HK in 2021.
Selling, General and Administrative (SG&A) Expenses
The three months ended September 30, 2022; our SG&A expense was $83,162 compared to $188,817 for the same period in 2021. The decrease was a result of separating the subcontractor category from SG&A.
Salaries Expense
The three months ended September 30, 2022; our Salaries expense was $197,036 compared to $228,565 for the same period in 2021.
Travel Expense
The three months ended September 30, 2022; our travel expense was $38,990 compared to $26,381for the same period in 2021. The increase in the quarter ending in September 30, 2022 was due to additional site assessment surveys of multiple facilities in Europe and global commissioning.
Professional fees Expense
The three months ended September 30, 2022; our Professional fees expense was $135,441 compared to $41,174 for the same period in 2021. The increase in legal fees was due to higher expenses related to a proposed IPO and up listing to NASDAQ.
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Results of the ~~six~~nine month ended ~~June~~September 30, 2022, Compared to the ~~six~~nine month ended ~~June~~September 30, 2021

Net Sales

The Company has four reportable segments: Clean Energy HRS (HRS), CETY Europe srl, Engineering and Manufacturing Business and CETY HK.

Segment breakdown

The ~~six~~nine months ended ~~June~~September 30, 2022, our revenue from Engineering and Manufacturing was ~~$61,018~~$132,316 compared to ~~$41,223~~$91,262 for the same period in 2021.

The ~~six~~nine months ended ~~June~~September 30, 2022, our revenue from HRS was ~~$460,885~~$461,292 compared to ~~$88,807~~$602,207 for the same period in 2021. This ~~increase~~decrease was mainly because of ~~more interest in~~delay with the passing of inflation reduction act and the incentives associated with heat recovery ~~projects.~~solution.

The ~~six~~nine months ended ~~June~~September 30, 2022, our revenue from CETY Europe was ~~$38,012~~$48,138 compared to ~~$161,128~~$173,234 for the same period in 2021. This decrease was a result of a sell of an equipment in 2021 vs. just the service revenue.

The ~~six~~nine months ended ~~June~~September 30, 2022, our revenue from our wholly owned subsidiary CETY HK was ~~$1,983,062~~$1,925,950 compared to $0 for the same period in 2021. This is a s a result of the acquisition of JHJ gas company made in ~~Nivember~~November of 2021. We started to generate revenue from this entity in the 1^st quarter of 2022.

Gross Profit

The ~~six~~nine months ended ~~June~~September 30, 2022; our gross profits were ~~$1,146,000~~$1,151,903 compared to ~~$218,539~~$519,683 for the same period in 2021. The increase in gross profit was due to higher revenues.

Segment breakdown

The ~~six~~nine months ended ~~June~~September 30, 2022, our gross profit from Engineering and Manufacturing was ~~$38,475~~$85,352 compared to ~~$29,683~~$72,853 for the same period in 2021.

The ~~six~~nine months ended ~~June~~September 30, 2022, our gross profit from HRS was ~~$413,646~~$427,219 compared to ~~$62,802,~~$312,118, for the same period in 2021. The increase from the HRS segment was mainly due to higher revenue in the first quarter of 2022.

The ~~six~~nine months ended ~~June~~September 30, 2022, our gross profit from CETY Europe was ~~$30,630~~$40,315 compared to ~~$126,054~~$134,712 for the same period in 2021. The decrease in gross profit was due to revenue generated from the sale of a clean cycle waste heat recovery system.

The ~~six~~nine months ended ~~June~~September 30, 2022, our gross profit from our wholly owned subsidiary CETY HK was ~~$663,249~~$631,082 compared to $0 for the same period in 2021. We had zero revenue from CETY HK in 2021.

Selling, General and Administrative (SG&A) Expenses

The ~~six~~nine months ended ~~June~~September 30, 2022; our SG&A expense was ~~$201,303~~$284,025 compared to ~~$340,521~~$529,335, for the same period in 2021. The decrease was a result of separating the subcontractor category from SG&A and lower cost of repair.

Salaries Expense

The ~~six~~nine months ended ~~June~~September 30, 2022; our Salaries expense was ~~$390,892~~$587,928 compared to ~~$433,069~~$661,634 for the same period in 2021. The decrease in the quarter ending in ~~June~~September 30, 2022 was due to less number of employees.

Travel Expense

The ~~six~~nine months ended ~~June~~September 30, 2022; our travel expense was ~~$87,398~~$126,388 compared to ~~$40,354~~$66,735 for the same period in 2021. ~~This~~The increase in the quarter ending in September 30, 2022 was due to additional site assessment surveys of multiple facilities in ~~Europe.~~Europe and global commissioning.

Professional fees Expense

The ~~six~~nine months ended ~~June~~September 30, 2022; our Professional fees expense was ~~$224,195~~$359,636 compared to ~~$82,209~~$123,383 for the same period in 2021. The increase in legal fees was due to higher expenses related to a proposed IPO and up listing to NASDAQ.

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Facility Lease and Maintenance Expense

The ~~six~~nine months ended ~~June~~September 30, 2022; our Facility Lease and maintenance expense was ~~$173,480~~$260,262 compared to ~~$168,910~~$254,708 for the same period in 2021.

Depreciation and Amortization Expense

The ~~six~~nine months ended ~~June~~September 30, 2022, our depreciation and amortization expense was ~~$15,038~~$22,557 compared to ~~$16,146~~$24,219 for the same period in 2021, which remained relatively unchanged.

Change in Derivative Liability

The ~~six~~nine months ended ~~June~~September 30, 2022; we had a gain on derivative liability of ~~$13,399~~$12,980, compared to a gain of ~~$1,745,369~~$1,734,624 for the same period in 2021. The gain in derivative liability was due to paying off several convertible notes in the six months ended June 30, 2021.

Gain on debt settlement

The ~~six~~nine months ended ~~June~~September 30, 2022, we recognized a gain on debt settlement in the amount of ~~$2,920~~$2920 compared to ~~$368,098~~$828,666 for the ~~six~~nine months ended ~~June~~September 30, 2021.

Interest and Finance Fees

The ~~six~~nine months ended ~~June~~September 30, 2022 interest and finance fees were ~~$416,275~~$747,451 compared to ~~$414,069~~$603,240 for the same period in 2021. ~~which remained relatively unchanged~~

Net Income / Loss

The ~~six~~nine months ended ~~June~~September 30, 2022; our loss was ~~$440,864~~$1,338,010 compared to net profit of ~~$836,728~~$819,719 for the same period in 2021. The higher profits was primarily due to the gain on derivative liability in 2021.

Liquidity and Capital Resources

Clean Energy Technologies, Inc.
Condensed Consolidated Statements of Cash Flows
for the ~~six~~nine months ended ~~June~~September 30, 2022
(unaudited)

2022 2021 2022 2021
Net Cash provided / (Used) In Operating Activities $ (1,233,918 ) $ (1,449,202 ) $ (1,929,678 ) $ (1,964,231 )
Cash Flows Used In Investing Activities (785,828 ) (1,388,734 )
Cash Flows Provided / (used) By Financing Activities 1,905,454 3,077,155 2,545,003 3,104,503
Net (Decrease) Increase in Cash and Cash Equivalents $ (223,397 ) $ 1,627,953 $ (1,016,545 ) $ 1,140,272

On February 21, 2022 the Company completed public and private financing of an aggregate of $1,202,800.

Capital Requirements for long-term Obligations

None.

Critical Accounting Policies

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management’s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

Future Financing

We will continue to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund planned acquisitions and exploration activities.

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Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by us as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our consolidated financial position or results of operations upon adoption.

Item 3. Quantitative and Qualitative Disclosure about Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”). Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of ~~June~~September 30, 2022, due to the material weaknesses resulting from the Board of Directors not currently having any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K, and controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Please refer to our Annual Report on Form 10-K as filed with the SEC on April 15, 2022, for a complete discussion relating to the foregoing evaluation of Disclosures and Procedures.

Changes in Internal Control over Financial Reporting

Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, the Company is involved in litigation incidental to the conduct of its business. The Company is presently not involved in any legal proceedings which in the opinion of management are likely to have a material adverse effect on the Company’s consolidated financial position or results of operations.

Item 1A. Risk Factors.

There have been no material changes in the Company’s risk factors from those previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2021.

Item 2. Unregistered Sales of Equity Securities

On January 21, 2020, our Registration Statement on Form 1-A was qualified with the Securities and Exchange Commission, under which we may offer up to 300,000,000 shares of our common stock at a purchase price of $.03 per share. As of the date hereof, 4,523,333 shares of common stock have been issued thereunder.

On January 30, 2020 we issued 1,700,000 shares of our common stock at a purchase price of $.02 per share, as settlement in full of a note payable of in the amount of $36,500 with accrued interest of 19,721. As a result we recognized a gain in the amount of $22,221 in the 1^st quarter of 2020.

On February 4, 2020 we issued 2,000,000 shares of our common stock at a price of $.04 per share, in exchange for the conversion of 800 shares of our Series D Preferred Stock.

On July 23, 2020 we issued 3,000,000 shares of our common stock at a price of $.04 per share, in exchange for the conversion of 1,200 shares of our Series D Preferred Stock.

3031

On February 5, 2021 we issued 3,000,000 shares of our common stock at a price of $.08 per share, in exchange for the conversion of 1,200 shares of our Series D Preferred Stock.

On February 9, 2021 we issued 2,275,662 shares of our common stock share, in exchange for the conversion of $182,052 of accrued dividend for the series D Preferred Stock.

On March 12, 2021 we issued 1,625,000 shares and 2,068,588 of our common stock at a price of $.08 per share, in exchange for the conversion of 650 shares of our Series D Preferred Stock and 165,487 of accrued dividend for the series D preferred stock.

On June 28, 2021 MGW I converted $75,000 from the outstanding balance of their convertible note into 25,000,000 shares of company’s common stock.

On September 2, 2021 the company issued 1,142,459 as inducement shares. To GHS Investment for the equity line of credit at $0.0475 per share.

On September 13, 2021 the company issued 1,100,630 as issuance correction. To GHS Investment for the equity line of credit at $0.0475 per share.

On December 31,2021 the company issued 9,833,750 at a purchase price of $0.08 pre the 1A subscription agreement.

On February 21, 2022, we issued 15,035,000 shares of our common stock under our Reg A offering at $.08 per share. These shares are unrestricted and free trading.

On September 21, 2021 MGW I converted $1,548,904 from the outstanding balance of their convertible note into 516,301,343 shares of company’s common stock.
These securities were issued pursuant to Section 4(2) of the Securities Act and/or Rule 506 promulgated thereunder. The holders represented their intention to acquire the securities for investment only and not with a view towards distribution. The investors were given adequate information about us to make an informed investment decision. We did not engage in any general solicitation or advertising. We directed our transfer agent to issue the stock certificates with the appropriate restrictive legend affixed to the restricted stock.

Item 3. Defaults upon Senior Securities

We are currently in default on the payment of $1,200,000, to the balance of the purchase price pursuant to our asset purchase agreement with General Electric International, due to a combination of our inability to raise sufficient capital as expected and our belief that we are entitled to a reduction in purchase price we paid.

We are also in default of $187,285 payments of principal and interest on our notes payable to Cybernaut Zfounder Ventures.

Item 4. Mine Safety Disclosures

Not Applicable.

Item 5. Other Information

None.

Item 6. Exhibits

The exhibit listed on the Exhibit Index (following the signatures section of this quarterly report dated ~~June~~September 30, 2022 on Form 10-Q are included, or incorporated by reference, in this six months ended ~~June~~September 30, 2022 Report on Form 10-Q.

EXHIBIT
NUMBER
DESCRIPTION
31.01 Certification of Principal Executive Officer Pursuant to Rule 13a-14 Filed herewith.
31.02 Certification of Principal Financial Officer Pursuant to Rule 13a-14 Filed herewith.
32.01 Certification of CEO Pursuant to Section 906 of the Sarbanes-Oxley Act Filed herewith.
32.02 Certification of CFO Pursuant to Section 906 of the Sarbanes-Oxley Act Filed herewith.
101.INS* Inline XBRL Instance Document Furnished herewith.
101.SCH* Inline XBRL Taxonomy Extension Schema Document Furnished herewith.
101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document Furnished herewith.
101.LAB* Inline XBRL Taxonomy Extension Labels Linkbase Document Furnished herewith.
101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document Furnished herewith.
101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document Furnished herewith.
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

*Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

3132

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Costa Mesa, State of California on the 2214 th day of ~~August,~~November, 2022

Clean Energy Technologies, Inc.
REGISTRANT

/s/ Kambiz Mahdi
By: Kambiz Mahdi
Chief Executive Officer

Date: ~~August 22,~~November 14, 2022 ~~Update all dates to signing to signing date~~

/s/ Calvin Pang
By: Calvin Pang
Chief Financial Officer

Date: ~~August 22,~~November 14, 2022

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 date indicated.

Signature Title

/s/ Kambiz Mahdi Chief Executive Officer and Director
By: Kambiz Mahdi (Principal executive officer)

Date: ~~August 22,~~November 14, 2022

3233


	Common Stock .001 Par				Preferred Stock				Common Stock to be issued		Additional Paid in		Subscription			Accumulated Comprehensive			Accumulated			Non Controlling			Stock holders’ Deficit
Description	Shares		Amount		Shares		Amount		Amount		Capital		Interest			Income			Deficit			interest			Totals
December 31, 2021		943,569,149		943,569		-		-		-		14,777,708		-			-			(17,423,931	)		(19,059	)		(1,721,712	)

Shares issued for Reg A offering		15,035,000		15,035								1,187,765														1,202,800
Shares issued for S1		3,155,865		3,156								134,754														137,910
																										-
Subscription Receivable														(18,800	)											(18,800	)
Accumulated Comprehensive																	4,562									4,562
Net Loss		-		-		-		-		-				-			-			(112,589	)		-			(112,589	)
March 31, 2022		961,760,014		961,760		-		-		-		16,100,228		(18,800	)		4,562			(17,536,520	)		(19,059	)		(507,830	)
Beginning balance		961,760,014		961,760		-		-		-		16,100,228		(18,800	)		4,562			(17,536,520	)		(19,059	)		(507,830	)

Shares issued for Reg A offering	-		-								-														-
Shares issued for S1		4,915,932		4,916								148,319														153,235
Warrants issued Mast Hill fund												168,296														168,296
Subscription Receivable														-												-
Accumulated Comprehensive																	(113,666	)								(113,666	)
Net Loss		-				-		-		-				-			-			(346,943	)		-			(346,943	)
June 30, 2022		966,675,946		966,676		-		-		-		16,416,843		(18,800	)		(109,104	)		(17,883,464	)		(19,059	)		(646,909	)
Ending balance		966,675,946		966,676		-		-		-		16,416,843		(18,800	)		(109,104	)		(17,883,464	)		(19,059	)		(646,909	)

		2022			2021
Cash Flows from Operating Activities:
Net Income / ( Loss )	$	(1,322,861	)	$	819,719
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		22,557			24,219
Financing Fees		380,000			0
Gain on debt settlement		(2,920	)		(828,666	)
Shares issued for inducement					54,266
Amortization of debt discount		145,632
Change in debt discount and Financing fees		0			730,826
Change in derivative liability		12,980			(1,734,624	)
Changes in assets and liabilities:
(Increase) decrease in right of use asset		177,745			144,588
(Increase) decrease in lease liability		(175,172	)		(141,153	)
(Increase) decrease in accounts receivable		(1,113,760	)		(511,418	)
(Increase) decrease in longterm financing receivables					67,730
(Increase) decrease in inventory		(65,757	)		(167,739	)
(Increase) decrease in prepaid expenses		(194,306	)		-
(Decrease) increase in accounts payable		44,955			(673,236	)
Other (Decrease) increase in accrued expenses		171,619			141,969
Other (Decrease) increase in accrued expenses related party		0			(2,482	)
Other (Decrease) increase on equity method investment		13,650			-
Other (Decrease) increase in customer deposits		(24,040	)		111,770
Net Cash Provided by (Used In) Operating Activities		(1,929,678	)		(1,964,231	)

Cash Flows from Investing Activities
Convertible Note Receivable
(Increase) decrease in Heze Hongyuan Natural Gas Co		(838,090	)		-
(Increase) decrease in Shuya		(550,644	)
Purchase property plant and equipment
Cash Flows Used In Investing Activities		(1,388,734	)		-

Cash Flows from Financing Activities
Bank Overdraft / (Repayment)
Payment on line of credit		(219,656	)		(894,208	)
Payment on notes payable		(406,586	)		-
Proceeds from notes payable		1,677,300			414,200
Proceeds from notes payable related party		-			-
Stock issued for cash		1,493,945			3,584,511
Cash Flows Provided By Financing Activities		2,545,003			3,104,503

Effect of exchange rate changes on cash		(243,136	)		-

Net (Decrease) Increase in Cash and Cash Equivalents		(1,016,545	)		1,140,272
Cash and Cash Equivalents at Beginning of Period		1,192,316			414,885
Cash and Cash Equivalents at End of Period	$	175,771		$	1,555,157

Supplemental Cashflow Information:
Interest Paid	$	331,177		$	145,230
Taxes Paid	$			$	-

Supplemental Non-Cash Disclosure
Discount on new notes	$	437,044		$	-
Shares to be issued for warrants	$	240,824		$	450,000
Shares issued for debt conversion conversions	$	1,548,904		$	423,011

Furniture and fixtures		3 to 7 years
Equipment		7 to 10 years
Leasehold Improvements		7 years

		a.	A good or another asset from the other party which the entity then transfers to the customer. Note that momentary control before transfer to the customer may not qualify.
		b.	A right to a service to be performed by the other party, which gives the entity the ability to direct that party to provide the service to the customer on the entity’s behalf.
		c.	A good or service from the other party that it then combines with other goods or services in providing the specified good or service to the customer.

	●	Identify the contract with the customer

	●	Identify the performance obligations in the contract

	●	Determine the transaction price

	●	Allocate the transaction price to the performance obligations in the contract

	●	Recognize revenue when the company satisfies a performance obligation

	●	We generate a quotation

	●	We receive purchase orders from our customers.

	●	We build the product to their specification

	●	We invoice at the time of shipment

	●	The terms are typically Net 30 days

	●	Level 1: Quoted prices in active markets for identical assets or liabilities.

	●	Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

	●	Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s derivative liabilities have been valued as Level 3 instruments. We value the derivative liability using a lattice model, with a volatility of 84% and using a risk free interest rate of 0.15%

	Level 1		Level 2		Level 3		Total

Fair value of convertible notes derivative liability – June 30, 2022	$	–	$	–	$	270,082	$	270,082


	September 30, 2022		December 31, 2021
Lease asset	$	217,584	$	217,584


Consideration:
Cash and cash equivalents	$	1,500,000

Total purchaser consideration	$	1,500,000

Assets acquired:
Cash and cash equivalents	$	6,156
Prepayment	$	13,496
Other receivable	$	20,000
Trading Contracts	$	146,035
Shenzhen Gas Relationship	$	1,314,313
Total assets acquired	$	1,508,539

Liabilities assumed:
Advance Receipts	$	(8,539	)
Taxes Payable	$	179
Net Assets Acquired:	$	1,500,000

	June 30, 2022		December 31, 2021
Accrued Wages	$	69,007	$	22,950
Accrued Interest and other		72,556		120,897
Accrued Interest and other	$	141,563	$	143,847


Year	Lease Payment			Lease Payment
2022		120,942			61,922
2023		191,903			191,903
Imputed Interest		(14,047	)		(7,024	)
Net Lease Liability	$	298,798		$	246,801

	Warrants - Common Share Equivalents		Weighted Average Exercise price		Warrants exercisable - Common Share Equivalents		Weighted Average Exercise price		Warrants - Common Share Equivalents		Weighted Average Exercise price		Warrants exercisable - Common Share Equivalents		Weighted Average Exercise price
Outstanding December 31, 2021		8,754,720	$	0.04		8,754,720	$	0.04		8,754,720	$	0.04		8,754,720	$	0.04
Expired		3,754,720				3,754,720		0.04		3,754,720				3,754,720		0.04
Exercised
Issued		9,375,000								18,472,222
Outstanding June 30, 2022		14,375,000	$	0.04		5,000,000	$	0.04
Outstanding September 30, 2022										23,472,222	$	0.04		5,000,000	$	0.04

EXHIBIT NUMBER	DESCRIPTION
31.01	Certification of Principal Executive Officer Pursuant to Rule 13a-14	Filed herewith.
31.02	Certification of Principal Financial Officer Pursuant to Rule 13a-14	Filed herewith.
32.01	Certification of CEO Pursuant to Section 906 of the Sarbanes-Oxley Act	Filed herewith.
32.02	Certification of CFO Pursuant to Section 906 of the Sarbanes-Oxley Act	Filed herewith.
101.INS*	Inline XBRL Instance Document	Furnished herewith.
101.SCH*	Inline XBRL Taxonomy Extension Schema Document	Furnished herewith.
101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase Document	Furnished herewith.
101.LAB*	Inline XBRL Taxonomy Extension Labels Linkbase Document	Furnished herewith.
101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase Document	Furnished herewith.
101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase Document	Furnished herewith.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

Clean Energy Technologies, Inc.
REGISTRANT

	/s/ Kambiz Mahdi
By:	Kambiz Mahdi
	Chief Executive Officer

	Date: ~~August 22,~~November 14, 2022 ~~Update all dates to signing to signing date~~

	/s/ Calvin Pang
By:	Calvin Pang
	Chief Financial Officer

	Date: ~~August 22,~~November 14, 2022

Signature		Title

	/s/ Kambiz Mahdi	Chief Executive Officer and Director
By:	Kambiz Mahdi	(Principal executive officer)

	Date: ~~August 22,~~November 14, 2022