Clean Energy (CETY) 10-K 14 Apr 16 2015 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2015	Mar. 31, 2015	Jun. 30, 2014
Document and Entity Information:
Entity Registrant Name	Probe Manufacturing Inc.
Document Type	10-K
Document Period End Date	Dec. 31, 2015
Amendment Flag	false
Entity Central Index Key	1,329,606
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		139,446,765
Entity Public Float			$ 1,078,629
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	FY

Statement of Financial Position

Statement of Financial Position - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Assets, Current
Cash and Cash Equivalents, at Carrying Value	$ 4,196	$ 27,241
Accounts Receivable, Net, Current	474,699	306,540
Inventory, Net	1,207,409	557,382
Assets, Current	1,686,304	891,163
Assets, Noncurrent
Property Plant And Equipment Other	215,755	123,001
Goodwill	747,976	420,673
Indefinite-Lived Intangible Assets (Excluding Goodwill)	541,135
Other Assets, Noncurrent	57,708	35,056
Assets, Noncurrent	1,562,574	578,730
Assets	3,248,878	1,469,893
Liabilities, Current
BankOverdrafts		48,744
Accounts Payable, Current	609,407	574,520
Accrued Liabilities, Current	1,412,742	311,291
Other Short-term Borrowings	241,612
Due To Related Parties Current	143,038
Notes Payable, Current	1,291,922	556,523
Liabilities, Current	3,698,721	1,491,078
Liabilities, Noncurrent
Loans Payable, Noncurrent	800,000	38,146
Liabilities	4,498,721	1,529,224
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest
Preferred Stock, Value, Issued	750,000	750,000
Common Stock, Value, Issued	139,448	30,678
Additional Paid in Capital, Common Stock	2,736,480	1,465,826
Treasury Stock, Value	633	633
Retained Earnings (Accumulated Deficit)	(4,875,138)	(2,305,202)
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(1,249,843)	(59,331)
Liabilities and Equity	$ 3,248,878	$ 1,469,893

Statement of Financial Positio3

Statement of Financial Position - Parenthetical - $ / shares	Dec. 31, 2015	Dec. 31, 2014
Balance Sheets
Preferred Stock, Par Value	$ 100	$ 100
Preferred Stock, Shares Authorized	20,000	20,000
Preferred Stock, Shares Issued	7,500	7,500
Preferred Stock, Shares Outstanding	7,500	7,500
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	400,000,000	400,000,000
Common Stock, Shares Issued	139,446,765	24,251,945
Common Stock, Shares Outstanding	139,446,765	24,251,945

Statement of Income

Statement of Income - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Revenues
Sales Revenue Goods, Net	$ 2,355,012	$ 3,533,503
Revenues	2,355,012	3,533,503
Cost of Revenue
Cost of Goods Sold	1,686,116	2,741,147
Cost of Revenue	1,686,116	2,741,147
Gross Profit	668,896	792,356
Operating Expenses
General and Administrative Expense	2,336,058	1,596,587
ShareBasedCompensation	85,450	160,000
Operating Expenses	2,421,508	1,756,587
Operating Income (Loss)	(1,752,612)	(964,231)
Nonoperating Income (Expense)
GainsLossesOnExtinguishmentOfDebt		42,291
Nonoperating Income (Expense)		42,291
Interest and Debt Expense
Interest Expense	385,143	313,254
Gain (Loss) on Disposition of Intangible Assets	420,673
Nonoperating Gains (Losses)	11,508
Interest and Debt Expense	817,324	313,254
Income (Loss) from Continuing Operations before Income Taxes, Extraordinary Items, Noncontrolling Interest	(2,569,936)	(1,235,194)
IncomeTaxExpenseBenefitContinuingOperationsAbstract
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest	(2,569,936)	(1,235,194)
Net Income (Loss) Attributable to Parent	(2,569,936)	(1,235,194)
OtherComprehensiveIncomeLossNetOfTaxPortionAttributableToParentAbstract
ComprehensiveIncomeNetOfTax	$ (2,569,936)	$ (1,235,194)
Earnings Per Share
Earnings Per Share, Basic	$ (0.04)	$ (0.05)
Weighted Average Number of Shares Outstanding, Basic	59,583,060	25,985,566
Earnings Per Share, Diluted	$ (0.04)	$ (0.05)
Weighted Average Number of Shares Outstanding, Diluted	59,583,060	25,985,566

Statement of Cash Flows

Statement of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Net Cash Provided by (Used in) Operating Activities
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	$ (2,569,936)	$ (1,235,194)
Adjustments, Noncash Items, to Reconcile Net Income (Loss) to Cash Provided by (Used in) Operating Activities
Depreciation	42,122	42,108
Paid-in-Kind Interest		(13,125)
Employee Benefits and Share-based Compensation	85,450	160,000
Other Noncash Income (Expense)	420,673
Adjustments, Noncash Items, to Reconcile Net Income (Loss) to Cash Provided by (Used in) Operating Activities	(2,021,691)	(1,046,211)
Increase (Decrease) in Operating Assets
Increase Decrease In Receivables	49,425	107,873
Increase (Decrease) in Inventories	198,002	138,553
Increase (Decrease) in Prepaid Expense and Other Assets	(22,652)	7,388
Increase (Decrease) in Other Operating Assets
Increase (Decrease) in Operating Assets	224,775	253,814
Increase (Decrease) in Operating Liabilities
Increase (Decrease) in Accounts Payable	42,874	(87,253)
Increase (Decrease) in Accrued Liabilities	1,136,489	171,313
Increase (Decrease) in Operating Capital	1,179,363	84,060
Net Cash Provided by (Used in) Operating Activities	(617,553)	(708,337)
Net Cash Provided by (Used in) Investing Activities
Payments to Acquire Property, Plant, and Equipment		(2,339)
Net Cash Provided by (Used in) Investing Activities		(2,339)
Net Cash Provided by (Used in) Financing Activities
ProceedsFromRepaymentsOfBankOverdrafts	(48,744)	32,646
Proceeds from Issuance of Common Stock	546,000	287,419
Proceeds from (Repayments of) Notes Payable	97,252	411,103
Net Cash Provided by (Used in) Financing Activities	594,508	731,168
Cash and Cash Equivalents, Period Increase (Decrease)	(23,045)	20,492
Cash and Cash Equivalents, at Carrying Value	27,241	6,749
Cash and Cash Equivalents, at Carrying Value	$ 4,196	$ 27,241

Organization, Consolidation and

Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies	12 Months Ended
	Dec. 31, 2015
Notes
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies	The Company Clean Energy Technologies, Inc. (f/k/a Probe Manufacturing, Inc.) (the “Company,” “Clean Energy,” or “CETY”) headquartered in Costa Mesa, California, designs, builds and markets clean energy products focused on energy efficiency and environmentally sustainable technologies. The Company’s principal product is the Clean Cycle TM Our growth strategy is to scale our business by focusing on new market segments & regions in the fuel, incentive and process markets, sell equipment direct and through the global distribution channels, build and lease systems sites in island nations to offset the cost of their diesel fuel & emissions, license patented technology and proprietary process, develop cogeneration and OEM opportunities and develop higher output generators while lowering cost. Our initial acquisition in clean energy is the proprietary turbine technology for Organic Rankine Cycle (“ORC”)-based heat recovery power systems, which matches our manufacturing and engineering strengths. Our engineering and manufacturing services also provide a source of revenue and assist in providing opportunities for potential business and intellectual property acquisitions. On September 11, 2015, Clean Energy HRS LLC (“CE HRS”), a wholly owned subsidiary of the Company, entered into an Asset Purchase Agreement with General Electric International, Inc., a Delaware corporation (“GEII”), pursuant to which CE HRS acquired GEII’s Heat Recovery Solutions, or HRS, assets, including intellectual property, patents, trademarks, machinery, equipment, tooling and fixtures. The HRS assets will be used by the Company to manufacture and commercialize Organic Rankine Cycle (“ORC”)-based heat recovery power systems. The ORC system comprised GEII’s proprietary Clean Cycle turbine generator system and integrated power module, together with related components, controls, power electronics, software and equipment. The Company co-located and integrate the HRS assets with the Company’s existing engineering and manufacturing business at the former GEII facility in Costa Mesa, California. The consideration for the purchase of the HRS assets was set forth in the Asset Purchase Agreement, which was filed as Exhibit 10.1 to the Company’s Current Report on Form 8 K dated September 11, 2015. CE HRS issued a three-year promissory note to GEII with respect to payment of the cash portion of the purchase price and CE HRS assumed certain liabilities of GEII related to the acquired assets. In connection with the Asset Purchase Agreement, the Company also entered into various ancillary agreements customary for asset acquisition transactions of this type. In connection with the HRS asset transaction, on September 15, 2015, the Company entered into a Transaction Completion and Financing Agreement (the “ TCF Agreement ” ) with ETI Partners IV LLC, a Delaware limited liability company ( “ ETI ” ), pursuant to which the Company and ETI implemented a structure to provide for the Company to raise up to $5,000,000 in financing. In connection with the TCF Agreement, the Company agreed to issue to ETI 104,910,321 shares of restricted common stock, representing 70% of the fully diluted common stock of the Company upon receipt of an initial $500,000 in financing, which occurred during the quarter ending December 31, 2015. In conjunction with the TCF Agreement, the Company and ETI also entered into a Loan, Guarantee, and Collateral Agreement (the “ Loan Agreement ” ) and a Registration Rights Agreement. Financing to the Company is intended to be provided pursuant to the Loan Agreement and any shares issued or issuable in connection with the financing are granted certain demand registration rights pursuant to the Registration Rights Agreement. Pursuant to the TCF Agreement, the Company expanded its Board of Directors to 11 directors, and ETI nominated and elected five persons to the Board of Directors. In connection with the TCF Agreement, the Company also entered into various ancillary agreements customary for investment loan transactions of this type. On October 2, 2015, the Company issued an aggregate of 100,910,321 shares of common stock to one investor pursuant to the Transaction Completion and Financing Agreement and 4,000,000 to one investor. All such shares were issued to the accredited investors for cash . ETI Capital Partners IV (ETI) acquired a 70 % interest in Clean Energy Technologies, Inc. (CETI) formerly Probe Manufacturing, Inc. for $300,000 in cash. on October 1, ETI Recognized Assets Acquired 2,949,592 Liabilities Acquired 3,589,558 Cash paid 300,000 Non-controlling interest 191,990 Goodwill recognized 747,976 CETI - Push down accounting election Cash Received 300,000 Goodwill recognized 747,976 Equity 1,047,976 As part of completing the acquisition of the HRS assets pursuant to the Asset Purchase Agreement and the TCF Agreement and integration thereof into our business, we changed our name to “Clean Energy Technologies, Inc.” on November 13, 2015to better reflect the focus of our new business and business strategies. Previously, in March 2013, pursuant to an Agreement and Plan of Acquisition with Trident Manufacturing, Inc., a Utah corporation (“Trident”) and the shareholders of Trident, we acquired 100% of the issued and outstanding common stock shares of Trident in exchange for 1,600,000 shares of our restricted shares of common stock. As a result of the acquisition, Trident became a wholly-owned subsidiary of the Company. Trident is a full-service electronics manufacturing services company with a 16,000 sq. ft. manufacturing facility in Salt Lake City, Utah, servicing the industrial, aerospace, military, instrumentation, and medical markets since 2005.As of the Trident acquisition, we recognized $420,673 in goodwill. For the year ended December 31, 2015, we impaired the goodwill in the amount of $420,673. 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 of $1,249,843 and a working capital deficit of $2,012,417 and a net loss of $2,569,936 for the year ended December 31, 2015. The company also had an accumulated deficit of $4,875,138 as of December 31, 2015 and used $617,553 in net cash from operating activities for the year ended December 31, 2015. 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 a profitable operating stand 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 Management is taking the following steps to sustain profitability and growth: (i) increase sa es through existing global distribution channels and utilization of direct sales (ii) sell electricity by kWH to leveraging core competencies to acquire technologies and entertain equity opportunities and (i ) license patented technology and proprietary process and develop cogeneration and OEM opportunities. Our future success is likely dependent on our ability to sustain profitable growth and attain additional capital to support growth. There can be no assurance that we will be successful in obtaining any such financing, or that it will be able to generate sufficient positive cash flow from operations. The successful outcome of these or any future activities cannot be determined at this time and there is no assurance that if achieved, we will have sufficient funds to execute its business plans. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we be unable to continue as a going concern. Our Products and Services Our main product, the Clean Cycle HRS system, converts heat from variety of heat sources into clean, affordable electricity. Our heat recovery solution system generates electricity from heat with zero fuel required, zero emissions produced, and low maintenance. The Clean Cycle HRS system is also re-deployable with continuous 24x7 operation. Sales and Marketing Our marketing approach is to position the Company, our products and our services under our new “Clean Energy Technologies, Inc.” and “CETY” identity and brand. We intend to market our Heat Recovery Solutions products specifically using the market-recognized Clean Cycle brand name. We also intend to utilize our relationships to identify new market segments and regions in which we can expand the commercialization of our products. We intend to offer our products for sale and also to commercialize them under leases, energy-based contracts and other financing structures to accelerate customer adoption and increase market penetration. We also intend to explore licensing opportunities for our patented and other proprietary technologies. We utilize both direct sales force and global distributors with expertise in clean energy. 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. 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 a commercial bank. The total cash balance is insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 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 We grant credit to our customers located within the United States of America; and do not require collateral. 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 December 31, 2015, we had a reserve for potentially un-collectable accounts of $7,000. Five (5) customers accounted for approximately 94% of accounts receivable at December 31, 2015 and one customer accounted for 55% and no other customer accounted for more than 14% of the accounts receivable balance. Our trade accounts primarily represent unsecured receivables. Historically, our bad debt write-offs related to these trade accounts have been insignificant. 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 December 31, 2015, we had a reserve for potentially obsolete inventory of $250,000. 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: Furniture and fixtures 3 to 7 years Equipment 7 to 10 years Depreciation expense totaled $38, 145 and $42,108 for the year ended December 31, 2015 and 2014, respectively. Long –Lived Assets Our management assesses the recoverability of its long-lived assets by determining whether the depreciation and amortization of 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 Revenue from product and services are recognized at the time goods are shipped or services are provided to the customer, with an appropriate provision for returns and allowances. Terms are generally FOB origination with the right of inspection and acceptance. We have not experienced a material amount of rejected or damaged product. The Company provides services for its customers that range from contract design to original product design to repair services. The Company recognizes service revenue when the services have been performed, and the related costs are expensed as incurred. Fair Value of Financial Instruments 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 instruments. Other Comprehensive Income We have no material components of other comprehensive income (loss) and accordingly, net loss is equal to comprehensive loss in all periods. 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 December 31, 2015, we had outstanding common shares of 139,446,765 used in the calculation of basic earnings per share. Basic Weighted average common shares and equivalents at December 31, 2015 and 2014 were 59,583,060 and 25,980,566, respectively. As of December 31, 2015, we had outstanding warrants to purchase 1,050,000 additional common shares and options to purchase 75,122 additional common shares. Fully diluted weighted average common shares and equivalents were withheld from the calculation as they were considered anti-dilutive. Research and Development We had curtailed all research and development and were focusing our business on its core business of electronics contract manufacturing. However, on September 11, 2015 (the “Effective Date”), Clean Energy HRS LLC (“CE HRS”), a wholly owned subsidiary of Probe Manufacturing, Inc. (together with its consolidated subsidiaries, the “Company”), entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with General Electric International, Inc., a Delaware corporation (“GEII”), pursuant to which the Company acquired GEII’s Heat Recovery Solutions (“HRS”) assets, including intellectual property, patents, trademarks, machinery, equipment, tooling and fixtures. The HRS assets will be used by the Company to manufacture and commercialize Organic Rankine Cycle (“ORC”)-based heat recovery power systems. The ORC system comprises GEII’s proprietary Clean Cycle turbine generator system and integrated power module, together with related components, controls, power electronics, software and equipment. The Company co-locate and integrated the HRS assets with the Company’s existing business at the current HRS facility in Costa Mesa, California. We are in the process of analyzing this segment and research and development requirements. Research and Development Costs incurred in association with the alternative fuels technology development (which include salaries and equipment) were expensed as incurred. We had no expenses in Research and Development Costs during the years ended December 31, 2015 and 2014. Segment Information FASB Codification Topic 280, Segment Reporting 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 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 years ended December 31, 2015 and 2014 we had $85,450 and $160,000 respectively, in share based expense, due to the issuance of common stock. As of December 31, 2015 we had no further non-vested expense to be recognized. Income Taxes The Company accounts for income taxes under SFAS No. 109 (now contained in FASB Codification Topic 740-10-25, Accounting for Uncertainty in Income Taxes), which requires the asset and liability approach to accounting for income taxes. Under this method, deferred tax assets and liabilities are measured based on differences between financial reporting and tax bases of assets and liabilities measured using enacted tax rates and laws that are expected to be in effect when differences are expected to reverse. As of December 31, 2015, we had a net operating loss carry-forward of approximately $5,000,000 and a deferred tax asset of approximately $1,731,293 using the statutory rate of 34%. 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 $(1,731,293). 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. At December 31, 2015, the Company had not taken any tax positions that would require disclosure under FASB ASC 740. December 31, 2015 December 31, 2014 Deferred Tax Asset $ 1,731,293 $ 710,900 Valuation Allowance (1,731,293) (710,900) Deferred Tax Asset (Net) $ - $ - We are subject to taxation in the U.S. and the states of California and Utah. Further, the Company currently has no open tax years’ subject to audit prior to December 31, 2012. 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. Business Combination and Goodwill On March 20, 2013, we completed the acquisition of Trident whereby we acquired 100% of the issued and outstanding common stock shares of Trident in exchange for 1,600,000 shares of our restricted shares of common stock. As a result of the acquisition, Trident has become a wholly-owned subsidiary of the Company. As a result, we recognized $420,673 in goodwill. On January 2. 2016 we closed the Trident facility in Utah and as for the year ended December 31, 2015 we booked an impairment of the Goodwill in the amount of $420,673. 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 2015-16—Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments Update 2015-15—Interest—Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements—Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting (SEC Update) Update 2015-14—Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date Update 2015-11—Inventory (Topic 330): Simplifying the Measurement of Inventory Update 2015-08—Business Combinations (Topic 805): Pushdown Accounting—Amendments to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115 (SEC Update) Update No. 2015-03—Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs Update No. 2015-02—Consolidation (Topic 810): Amendments to the Consolidation Analysis.

Financing Receivables

Financing Receivables	12 Months Ended
	Dec. 31, 2015
Notes
Financing Receivables	NOTE 3 – ACCOUNTS AND NOTES RECEIVABLE December 31, 2015 December 31, 2014 Accounts Receivable Trade $ 481,699 $ 376,540 Less Reserve for uncollectable accounts (7,000) (70,000) Accounts Receivable (Net) $ 474,699 $ 306,540

Equity Method Investments and J

Equity Method Investments and Joint Ventures Disclosure	12 Months Ended
	Dec. 31, 2015
Notes
Equity Method Investments and Joint Ventures Disclosure	NOTE 4 – ASSET ACQUISITION On September 11, 2015, we issued a promissory note in the initial principal amount of $1,400,000 and assumed a pension liability of $100,000, for a total liability of $1,500,000, in connection with the Company’s acquisition from General Electric International, Inc., a Delaware corporation (“GEII”) of certain GEII’s heat recovery solutions, or HRS, assets, including intellectual property, patents, trademarks, machinery, equipment, tooling and fixtures. Acquired Assets Inventory $ 848,029 Leased asset 217,584 Property and Equipment 130,887 Intellectual Property 545,112 Assumed warranty Liability (241,612) Net Assets Acquired $ 1,500,000

Inventory Disclosure

Inventory Disclosure	12 Months Ended
	Dec. 31, 2015
Notes
Inventory Disclosure	NOTE 5 – INVENTORY Inventories by major classification were comprised of the following at: December 31, 2015 December 31, 2014 Raw Material $ 1,311,069 $ 647,824 Work in Process 143,119 166,529 Finished Goods 3,221 13,029 Total 1,457,409 827,382 Less reserve for excess or obsolete inventory (250,000) (270,000) Total Inventory $ 1,207,409 $ 557,382

Property, Plant and Equipment D

Property, Plant and Equipment Disclosure	12 Months Ended
	Dec. 31, 2015
Notes
Property, Plant and Equipment Disclosure	NOTE 6 – PROPERTY AND EQUIPMENT Property and equipment were comprised of the following at: December 31, 2015 December 31, 2014 Capital Equipment $ 1,842,333 $ 1,938,696 Leasehold improvements - 36,686 Total 1,842,333 1,975,382 Accumulated Depreciation (1,626,574) (1,852,381) Net Fixed Assets $ 215,759 $ 123,001

Accounts Payable and Accrued Li

Accounts Payable and Accrued Liabilities Disclosure	12 Months Ended
	Dec. 31, 2015
Notes
Accounts Payable and Accrued Liabilities Disclosure	NOTE 7 – ACCRUED EXPENSES December 31, 2015 December 31, 2014 Accrued Wages $ 339,329 $ 125,900 Accrued Interest 27,592 51,259 Customer deposits 204,763 8,000 Accrued Payable to GE - Estimate 792,868 - Accrued Rent 48,190 48,190 Total Accrued Expenses $ 1,412,742 $ 233,349

Debt Disclosure

Debt Disclosure	12 Months Ended
	Dec. 31, 2015
Notes
Debt Disclosure	NOTE 8 – NOTES PAYABLE 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, 2015 the outstanding balance was $38,500. On November 11, 2013, we entered in to 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 December 31, 2015, the outstanding balance was $786,227, compared to $393,399 at December 31, 2014. On November 3, 2009, the Company issued an unsecured note payable to Linwood Goddard at a 12.00% interest rate, with a 36-month amortization and monthly payments of $334.14. At December 31, 2015, the outstanding balance was $4,332. On December 24, 2009, the Company issued an unsecured note payable to Linwood Goddard at a 12.00% interest rate, with a 36-month amortization and monthly payments of $334.14. At December 31, 2015, the outstanding balance was $4,332. On August 28, 2014, we issued an unsecured note for $100,000 with a fixed fee of $20,000, amortized over 7 months. On December 22, 2014, the outstanding balance of this note including remaining fees was $58,441, when the outstanding balance was rolled into a new note in the initial principal amount of $150,000, with fees in the amount of $28,500. The new note amortizes over 18 months. The outstanding balance at December 31, 2015 was $59,331. 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 installments of principal and interest of $157,609.02, commencing on December 31, 2016 and continuing until June 30, 2018, 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. Note Payable Requirements for long-term Obligations 2016 2017 2018 Note payable General Electric 315,218 630,436 254,346

Commitments and Contingencies D

Commitments and Contingencies Disclosure	12 Months Ended
	Dec. 31, 2015
Notes
Commitments and Contingencies Disclosure	NOTE 9 – COMMITMENTS AND CONTINGENCIES Operating Rental Leases On February 21, 2012 Trident Manufacturing, Inc. entered into a 5-year lease with First Industrial Realty Trust, Inc. with a commencement date of February 21, 2012. The facility is approximately 15,040 square feet and located at 440 West Lawndale Drive, Salt Lake City UT 84115. Year Annual Rent 2016 81,216 2017 13,536 In April 2015, Trident entered into a sublease agreement with Lucky Spoon, LLC. The term of the sublease commenced on April 1, 2015 and expires on the last day of Trident’s lease. On August 27,2015, we entered into a sublease agreement with Rosenson Properties, LLC, a California limited liability company, as landlord, and General Electric International, Inc., a Delaware corporation, as tenant and assignor, for the premises located at 150 Baker Street East, Costa Mesa, California. GEII had entered into a lease dated as of December 17, 2010, as amended by a First Amendment to Lease dated March 11, 2014, wherein Rosenson Properties leased the premises to GEII. The premises consist of approximately 35,704 square feet of space and the lease provides for monthly triple-net lease payments of $22, 973. The lease term ends on March 31, 2016. Year Annual Rent 2016 54,098 On May 1, 2016 we will be moving our corporate headquarters to 2990 Redhill Unit A, Costa Mesa, CA. On March 10, 2016, 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, 2016. Rental is $179,090 for the first twelve months. Year Lease Payment 2016 $179,090 2017 $221,352 2018 $228,000 2019 $234,840 2020 $241,884 2021 $249,132 2022 $256,608 2023 $44,052 Severance Benefits Effective at December 31, 2015, Mr. Mahdi was entitled to receive in the event of his termination without cause a severance benefit consisting of a single lump sum cash payment equal the salary that Mr. Mahdi would have been entitled to receive period of (1) year, at an annual salary of $275,000. Effective at December 31, 2015, Mr. Bennett was entitled to receive in the event of his termination without cause a severance benefit consisting of a single lump sum cash payment equal the salary that Mr. Bennett would have been entitled to receive through the remainder of his employment period or two (2) years, whichever is greater, at an annual salary of $140,000.

Stockholders' Equity Note Discl

Stockholders' Equity Note Disclosure	12 Months Ended
	Dec. 31, 2015
Notes
Stockholders' Equity Note Disclosure	NOTE 10 – 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. Stock Repurchase Program On November 1, 2011, the Company adopted a plan to repurchase up to 500,000 shares of its issued and outstanding common stock in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 promulgated under the Securities Exchange Act of 1934, as amended. The plan allows the Company to purchase its issued and outstanding common shares in the open market or in negotiated transactions, from time to time, depending on market conditions and other factors as well as being in compliance with applicable securities laws. The plan does not obligate the Company to make any purchases, at any specific time or in any particular situation. The plan may be suspended or discontinued at any time at the sole discretion of the Company. Share repurchases will be funded with the Company’s available cash, after determining the working capital requirements of the Company. Accordingly, there is no guarantee as to the exact number of shares that will be repurchased under the plan. The Company’s Board of Directors authorized the repurchase plan because it believed market conditions at the time of the plan’s adoption or thereafter may cause the Company’s common stock to be undervalued and repurchases of Company common stock to be in the best interests of the Company and its stockholders. The timing and number of any shares repurchased will depend on the terms and conditions of the plan and no assurance can be given that any specific amount of common stock will be repurchased. As of December 31, 2015 and 2014, we had repurchased an aggregate total of 11,500 shares of our common stock under the plan. Common Stock Transactions Beginning with the year 2014, we issued the following securities without registration under the Securities Act of 1933, as amended. These securities were issued on the reliance of an exemption provided by Section 4(a)(2) of the Securities Act. On May 12, 2014, we issued 500,000 shares of common stock for services at $.05 per share. On September 4, 2014, we issued 729,167 shares of common stock to Luxus Micro Cap S.A. for conversion of accrued interest under the series D preferred stock and $.08 per share. On November 15, 2014, we issued 850,000 shares and accrued for 450,000 of common stock for services to related parties at $.05 per share. On December 1, 2014, we issued 1,400,000 shares of common stock for services at $.06 per share. On December 2, 2014, we issued 2,945,333 for cash. On February 2, 2015, we issued 40,000 shares of common stock for services at $.08 On February 24, 2015, we issued 1,845,000 shares of common stock for cash in the amount of $116,698, of which $70,699 was received in 2014 and the balance included in “to be issued.” On March 6, 2015, we issued 450,000 shares of common stock for services to related parties at $.05 per share, which was accrued for in 2014. On March 6, 2015, we issued 50,000 shares of common stock for services at $.05 per share. On April 1, 2015 we issued 25,000 shares of common stock for consulting services at $.05 per share. On September 11, 2015, we issued 1,300,000 shares of common stock for compensation at $.05 per share. On O ctober 1, 2015, the Company issued 150,000 shares of its common stock for consulting services. On October 2, 2015, the Company issued an aggregate of 100,910,321 shares of common stock to one investor pursuant to the Transaction Completion and Financing Agreement and 4,000,000 to one investor. All such shares were issued to the accredited investors for cash of $500,000. Common Stock Our Articles of Incorporation authorize us to issue 200,000,000 shares of common stock, par value $0.001 per share. As of December 31, 2015 there were 139,446,765 and 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 10,000,000 shares of preferred stock. We authorized 440 shares of Series A Convertible Preferred Stock and 20,000 shares of Series B Convertible Preferred Stock. On May 25, 2006 the Articles of Incorporation were amended to authorize 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. 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. Effective August 7, 2013, our Board of Directors designated a series of our preferred stock as Series D Preferred Stock, authorizing 15,000 shares. We have received an aggregate of $750,000 in financing in subscription for Series D Preferred Stock. 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 6 months. The following are primary terms of the Series D Preferred Stock offering. The Series D Preferred holders will be paid a special monthly divided at the rate of 17.5% per annum or at the option of the investor such special may accrue such special dividends. If the Company does not pay the special 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 penalty of 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 shall 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 shall be 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. If Company is not in financial position to pay it back it need to notify the investors thirty (30) days prior the redemption period commencing and both parties will negotiate in good faith for an extension of the redemption period. The Company may elect to redeem the Series D Preferred Stock any time after the offering closing 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. On June 25, 2013, we received $500,000 from a related party in subscription for 5,000 shares of Preferred Series D Preferred Stock. These shares have not been issued as of the date of this filing. On August 21, 2014, the related party agreed to lower the dividend rate to 13% and extend the term on the redemption period for these shares for an additional one year. On September 8, 2015 the investors signed an estoppel agreement, whereby the investors agreed to reduce, (effective as of June 30, 2015), the dividend rate on the Series D Preferred Stock to six percent per annum and to terminate the penalty provided for in the IAs in respect of unpaid dividends accruing on or after such date. On connection with the subscription for such shares, we issued series F warrants to purchase 250,000 shares of our common stock at $.10 and series G warrants to purchase 250,000 shares of our common stock at $.20. Each warrant gives the holder the right to purchase one share of common stock. On September 19, 2013, we received $250,000 from a related party in subscription for 2,500 shares of Series D Preferred Stock. These shares have not been issued as of the date of this filing. On September 8, 2015 the investors signed an estoppel agreement, whereby the investors agreed to reduce, (effective as of June 30, 2015), the dividend rate on the Series D Preferred Stock to six percent per annum and to terminate the penalty provided for in the IAs in respect of unpaid dividends accruing on or after such date. In connection with the subscription for such shares, we issued series F warrants to purchase 125,000 shares of our common stock at $.10 and series G warrants to purchase 125,000 shares of our common stock at $.20. Each warrant gives the holder the right to purchase 1 share of common stock. Warrants Series E – Common Stock warrants On April 8, 2011, we issued 300,000 series E Warrants. Each warrant gives the holder the right to purchase one share of common stock (300,000 total shares) at $0.50 per share. The Series E Warrants expire on April 8, 2016, as a result we recognized $6,600 in share-based expense. Series F – Common Stock warrants On June 25, 2013, we issued 250,000 series F warrants. Each warrant gives the holder the right to purchase one share of common stock at $.10. On September 19, 2013, we issued 125,000 series F warrants. Each warrant gives the holder the right to purchase one share of common stock at $.10. Series G – Common Stock warrants On June 25, 2013, we issued 250,000 series G warrants. Each warrant gives the holder the right to purchase one share of common stock at $.20. On September 19, 2013, we issued 125,000 series G warrants. Each warrant gives the holder the right to purchase one share of common stock at $.20. A summary of warrant activity for the periods is as follows: Warrants - Common Share Equivalents Weighted Average Exercise price Warrants exercisable - Common Share Equivalents Weighted Average Exercise price Outstanding December 31, 2013 1,050,000 0.25 1,050,000 0.25 Granted - - - - Expired - - - - Exercised - - - - Outstanding December 31, 2014 1,050,000 0.25 1,050,000 0.25 Granted - - - - Expired - - - - Exercised - - - - Outstanding December 31, 2015 1,050,000 0.25 1,050,000 0.25 Warrants Outstanding Warrants Exercisable Range of Warrant Exercise Price Warrants - Common Share Equivalents Weighted Average Exercise price Weighted Average Remaining Contractual life in years Warrants - Common Share Equivalents Weighted Average Exercise price $ 0.50 300,000 $ 0.50 .27 300,000 $ 0.50 $ 0.10 250,000 $ 0.10 2.25 250,000 $ 0.10 $ 0.20 250,000 $ 0.20 2.25 250,000 $ 0.20 $ 0.10 125,000 $ 0.10 2.50 125,000 $ 0.10 $ 0.20 125,000 $ 0.20 2.50 125,000 $ 0.20 Total 1,050,000 $ 0.25 1,050,000 $ 0.25 Stock Options On February 8, 2007 pursuant to our 2006 Qualified Incentive Option Plan, we granted to Company employees incentive stock options to purchase 406,638 shares of our common stock. These options were granted at $1.73 cents, the fair market value of the Company’s common stock at the time of the grant. These options expire on February 8, 2017. At December 31, 2015, there were 15,122 outstanding options under this plan. On February 8, 2008, we granted stock options to our key employees to purchase up to 750,000 shares of our common stock. These options were granted at $1.73 cents, the fair market value of the Company’s common stock at the time of the grant. These options expire on February 8, 2017. At December 31, 2015, the balance of the outstanding options under this plan is 30,000. On February 28, 2008, we granted stock options to a key employee to purchase up to 30,000 shares of our common stock. These options were granted at $.033 cents, the fair market value of the Company’s common stock at the time of the grant. These options expire on February 8, 2017. At December 31, 2015, the balance of the outstanding options under this plan was 30,000.

Related Party Transactions Disc

Related Party Transactions Disclosure	12 Months Ended
	Dec. 31, 2015
Notes
Related Party Transactions Disclosure	NOTE 11 – RELATED PARTY TRANSACTIONS Kevin Scott, one of the Board of Directors members, owns SK Polymers. SK Polymers is a supplier to the Company. Our board of directors has approved the supply transactions between SK Polymers and the Company. 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, from time to time we provide assembly and value-added services to Billet Electronics. In addition, Billet was a supplier of parts and had dealings with current and former customers of our company. Our board of directors has approved the transactions between Billet Electronics and the Company. On September 4, 2014, we issued 729,167 shares of common stock to Luxus Micro Cap S.A. (controlled by director Juhani Taskinen) for conversion of accrued interest under the Series D Preferred Stock at $.08 per share On November 15, 2014, we issued 400,000 shares of common stock to John Bennett, our Chief Financial Officer, as additional compensation and accrued for 100,000 shares for board of director compensation at $.05 per share. On November 15, 2014, we issued 100,000 shares of common stock and accrued for 100,000 shares of common stock for board of director compensation to Kam Mahdi our Chief Executive officer at $.05 per share. On November 15, 2014, we issued 100,000 shares of common stock and accrued for 100,000 shares of common stock for board of director compensation to Robert Young at $.05 per share. On November 15, 2014, we issued 100,000 shares of common stock and accrued for 100,000 shares of common stock for board of director compensation to Shervin Talieh at $.05 per share. On September 11, 2015, we issued 400,000 shares of common stock to John Bennett, our Chief Financial Officer, as additional compensation at $.05 per share. On September 11, 2015, we issued 150,000 shares of common stock for board of director compensation to Kam Mahdi our Chief Executive officer at $.05 per share. On September 11, 2015, we issued 150,000 shares of common stock for board of director compensation to Robert Young at $.05 per share. On September 11, 2015, we issued 150,000 shares of common stock for board of director compensation to Shervin Talieh at $.05 per share. On September 11, 2015, we issued 150,000 shares of common stock and accrued for 150,000 shares of common stock for board of director compensation to Kevin Scott at $.05 per share. On September 11, 2015, we issued 150,000 shares of common stock shares of common stock for board of director compensation to Juhani Taskinen at $.05 per share. On September 11, 2015, we issued 150,000 shares of common stock shares of common stock for board of director compensation to John Bennett our Chief Financial Officer at $.05 per share.

Subsequent Events

Subsequent Events	12 Months Ended
	Dec. 31, 2015
Notes
Subsequent Events	NOTE 12 – SUBSEQUENT EVENTS On March 11, 2016, we entered into a 3-year convertible note payable for $75,000, which accrues interest at the rate of 1.46% per annum. On March 10, 2016, 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, 2016. Rental is $179,090 for the first twelve months.