10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2018

[  ] 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 333-145939

CLEANTECH BIOFUELS, INC.

(Exact name of registrant as specified in its charter)

Delaware	33-0754902
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
7386 Pershing Ave., University City, Missouri	63130
(Address of principal executive offices)	(Zip Code)

(Registrant's telephone number): (314) 802-8670

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

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

Large accelerated filer [  ]	Accelerated filer [  ]
Non-accelerated filer [  ]	Smaller reporting company [X]
(Do not check if a 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 [X]

As of August 13, 2018, 99,083,409 shares of the Company's common stock were outstanding.

1

CLEANTECH BIOFUELS, INC.

TABLE OF CONTENTS

		PAGE
PART I	Financial Information	3
Item 1	Consolidated Financial Statements	3
	Consolidated Balance Sheets – June 30, 2018 and December 31, 2017	3
	Consolidated Statements of Operations - Six months ended June 30, 2018 and 2017	4
	Consolidated Statements of Changes in Stockholders’ Equity (Deficit) – June 30, 2018	5
	Consolidated Statements of Cash Flows – Six months ended June 30, 2018 and 2017	6
	Notes to Consolidated Financial Statements	7
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4	Controls and Procedures	28
PART II	Other Information	29
Item 1	Legal Proceedings	29
Item 1A	Risk Factors	30
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3	Defaults upon Senior Securities	30
Item 4	Mine Safety Disclosures	30
Item 5	Other Information	30
Item 6	Exhibits	30
Signatures		31

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PART I. FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

 CLEANTECH BIOFUELS, INC.

 (formerly Alternative Ethanol Technologies, Inc.)

 CONSOLIDATED BALANCE SHEETS

	(unaudited)			(audited)
	June 30,			December 31,
	2018			2017
ASSETS
Current Assets:
Cash and cash equivalents	$	1,421		$	2,505
Prepaids and other current assets		59,918			64,718
		61,339			67,223
Property and equipment, net		-			-
Non-Current Assets:
Technology license		1,569,250			1,569,250
Patents		600,000			600,000
Intangibles		50,914			50,914
Goodwill		26,582			26,582
Total Assets	$	2,308,085		$	2,313,969
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable	$	429,442		$	429,699
Accrued interest		1,306,755			1,194,149
Accrued payroll and professional fees		1,880,533			1,784,870
Notes payable, net		3,142,152			3,032,553
Total Current Liabilities		6,758,882			6,441,271
Notes Payable - Long-Term		-			-
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock, $0.001 par value; 10,000,000 authorized shares; no shares issued or outstanding		-			-
Common stock, $0.001 par value; 240,000,000 authorized shares; 99,083,409 and 97,633,409 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively		99,083			97,633
Minority Interest		505			505
Additional paid-in capital		7,558,007			7,536,257
Notes receivable - restricted common stock		(68,081	)		(66,288	)
Accumulated deficit		(12,040,311	)		(11,695,409	)
Total Stockholders' Equity (Deficit)		(4,450,797	)		(4,127,302	)
Total Liabilities and Stockholders' Equity (Deficit)	$	2,308,085		$	2,313,969

The accompanying notes are an integral part of these consolidated financial statements.

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CLEANTECH BIOFUELS, INC.

(formerly Alternative Ethanol Technologies, Inc.)

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

	Three months ended						Six months ended
	June 30,						June 30,
	2018			2017			2018			2017
Costs and expenses:
General and administrative	$	61,121		$	61,529		$	114,859		$	118,504
Professional fees		41,115			27,107			106,631			69,930
		102,236			88,636			221,490			188,434
Other expense (income):
Interest expense		63,817			63,172			125,205			115,470
Interest income, net of accrued interest written-off		(908	)		(1,245	)		(1,793	)		(2,481	)
		62,909			61,927			123,412			112,989
Income tax benefit		-			-			-			-
Net loss	$	165,145		$	150,563		$	344,902		$	301,423
Basic and diluted net loss per common share		**			**			**			**
Weighted average common shares outstanding		99,083,409			94,921,746			98,566,742			94,721,746

** - less than $0.01

The accompanying notes are an integral part of these consolidated financial statements.

4

CLEANTECH BIOFUELS, INC.

(formerly Alternative Ethanol Technologies, Inc.)

Consolidated Statements of Changes in Stockholders' Equity (Deficit) (unaudited)

									Notes Rec -
					Additional				Restricted
	Common Stock				Paid-in		Minority		Common			Accumulated
	Shares		Amount		Capital		Interest		Stock			Deficit
Balances at December 31, 2017		97,633,409	$	97,633	$	7,536,257	$	505	$	(66,288	)	$	(11,695,409	)
Issuance of restricted shares to consultants at $0.04/share		1,450,000		1,450		21,750		-		-			-
Interest on Notes Receivable		-		-		-		-		(1,793	)		-
Net loss		-		-		-		-		-			(344,902	)
Balances at June 30, 2018		99,083,409	$	99,083	$	7,558,007	$	505	$	(68,081	)	$	(12,040,311	)

The accompanying notes are an integral part of these consolidated financial statements.

5

CLEANTECH BIOFUELS, INC.

(formerly Alternative Ethanol Technologies, Inc.)

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

	Six months ended
	June 30,
Operating Activities	2018			2017
Net loss applicable to common stockholders	$	(344,902	)	$	(301,423	)
Adjustments to reconcile net loss applicable to common stockholders to net cash used by operating activities:
Items that did not use (provide) cash:
Interest income, net of accrued interest written-off		(1,793	)		(2,481	)
Issuance of restricted common stock		23,200			3,200
Changes in operating assets and liabilities that provided (used) cash, net:
Prepaids and other current assets		4,800			7,701
Accounts payable		(257	)		1,545
Other assets and other liabilities		125,205			115,451
Accrued liabilities		95,663			95,690
Net cash used by operating activities		(98,084	)		(80,317	)
Cash Flows Provided (Used) by Investing Activities
Expenditures for equipment		-			-
Net cash used by investing activities		-			-
Cash Flows Provided (Used) by Financing Activities
Issuance of Note Payable		97,000			15,000
Payments on Notes Payable		-			(5,000	)
Sale of common stock		-			100,000
Net cash provided by financing activities		97,000			110,000
Net (decrease) increase in cash and cash equivalents		(1,084	)		29,683
Cash and cash equivalents at beginning of period		2,505			636
Cash and cash equivalents at end of period	$	1,421		$	30,319
Supplemental disclosure of cash flow information:
Cash paid for interest	$	-		$	-
Supplemental disclosure of noncash investing and financing activities:
Common stock issued to consultant, directors, and/or employee	$	23,200		$	3,200

The accompanying notes are an integral part of these consolidated financial statements.

6

CLEANTECH BIOFUELS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Note 1 – Organization and Business

Alternative Ethanol Technologies, Inc. (the “Company”), was incorporated in Delaware on December 20, 1996. Effective August 2, 2007, the Company changed its name to CleanTech Biofuels, Inc. Except where otherwise noted, the words “we,” “us,” “our,” and similar terms, as well as “CleanTech” or the “Company,” refer to CleanTech Biofuels, Inc. and its subsidiaries, collectively.

On March 27, 2007, the Company acquired SRS Energy, Inc., a Delaware corporation (“SRS Energy”), pursuant to an Agreement and Plan of Merger and Reorganization. In accordance with the merger agreement, SRS Acquisition Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company, merged with and into SRS Energy. The merger was consummated on May 31, 2007 and resulted in SRS Energy becoming a wholly-owned subsidiary of the Company. As a result of the merger, the stockholders of SRS Energy surrendered all of their issued and outstanding common stock and received shares of the Company’s common stock, $.001 par value per share (“Common Stock”). The former parent of SRS Energy, Supercritical Recovery Systems, Inc., immediately prior to the merger, distributed 78.8% of its 96% ownership in SRS Energy to its shareholders on a pro rata basis. For accounting purposes, because the Company had been a public shell company prior to the merger, the merger was treated as an acquisition of the Company and a recapitalization of SRS Energy.

The Company is in its development stage and has been engaged in technology development and pre-operational activities since its formation. The Company is currently seeking outside sources of funding that will provide the capital for us to design, build, and operate a commercial biomass recovery plant that will allow us to produce biomass feedstock for customer evaluation, trial purchases, and/or be used in equipment selection for power generation and possibly combined heat and power (“CHP”) production. Initially, the biomass feedstock output is expected to be sold or provided to electric utilities, power and steam producers, power and CHP equipment suppliers, and biofuel research firms for evaluation. In addition to seeking a source of funding for plant development, the Company hopes to license and/or develop potential commercial projects as they present themselves. Our development plan is to focus on cleaning and separating municipal solid waste (“MSW”) into its component parts in order to obtain: (i) a homogenous feedstock of cellulosic biomass for producing energy and other chemical products and (ii) recyclable products (metals, plastics, aluminum). Our plans may also include the possibility of operating a MSW transfer station where we could install our technology.

The Company has no operating history as a producer of biomass or energy sources and has not constructed any plants to date. We have no revenues and will be required to secure outside funding in order to execute our business plan and commercialize our products. Our current cash is not sufficient to fund our current operations. Our liabilities are substantially greater than our current available funds and current assets. Although we continue to seek additional financing through the sale of additional equity, various government funding opportunities and/or possibly through strategic alliances with larger energy or waste management companies, we have not had recent success securing meaningful amounts of financing. The Company will require substantial additional financing to implement its business plan and it may be unable to obtain the capital required to do so. If we are not able to immediately and successfully raise additional capital and/or achieve profitability or positive cash flow, we may not be able to continue operations.

The accompanying unaudited, consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Articles 8 and 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring items considered necessary for a fair presentation, have been included. Operating results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the year ended December 31, 2018. For further information, refer to the Company’s audited Consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017, filed with the Securities and Exchange Commission (“SEC”) on April 2, 2018.

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Note 2 – Recent Accounting Pronouncements   

In June of 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-07 Compensation – Stock Compensation (Topic 718). This ASU addresses share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606, Revenue from Contracts with Customers. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures.

In July 2017, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2017-11 Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815). This ASU changes the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (“EPS”) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. The standard is effective for annual reporting periods beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted, including adoption in any interim period. We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures.

In May 2017, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2017-09 Compensation – Stock Compensation (Topic 718) Scope of Modification Accounting. This ASU, which amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718. Specifically, an entity would not apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. The standard is effective for annual reporting periods, including interim periods within those annual reporting periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period. The adoption of this guidance did not have a material impact on our consolidated financial statements and related disclosures.

In January 2017, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2017-04 Intangibles —Goodwill and Other (Topic 350) “Simplifying the Test for Goodwill Impairment.” This ASU simplifies several aspects of the accounting for goodwill impairment. The guidance requires an entity to perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The standard is effective for annual periods beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures. 

In February 2016, the FASB issued ASU No. 2016-02, “Leases.” This ASU requires lessees to recognize most leases on their balance sheets for the rights and obligations created by those leases. The guidance requires enhanced disclosures regarding the amount, timing, and uncertainty of cash flows arising from leases and will be effective for interim and annual periods beginning after December 15, 2018. Early adoption is permitted. The ASU requires adoption based upon a modified retrospective approach. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements and related disclosures.  

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” This ASU will supersede most of the existing revenue recognition requirements in U.S. GAAP and will require entities to recognize revenue at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. The new standard also specifies new accounting for costs associated with obtaining or fulfilling contracts with customers and expands the required disclosures related to revenue and cash flows from contracts with customers. This new guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period and can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption, with early application not permitted. In August 2015, the FASB approved a one-year deferral of the effective date of this ASU. This standard will now become effective beginning with the first quarter 2018 and can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption. We have adopted the guidance and currently it does not have a material impact on the financial statements as the Company does not have revenue. The requirements of the ASU will be followed when the Company does have revenue.

There were various other accounting standards updates recently issued, most of which represented technical corrections to the accounting literature or were applicable to specific industries and are not expected to have a material impact on the Company's financial position, results of operations or cash flows.

Note 3 – Mergers/Acquisitions

25 Van Keuren LLC

On June 23, 2016, the Company entered into an Acquisition Agreement with 25 Van Keuren LLC, a New Jersey Limited Liability Company (“Van Keuren”), pursuant to which the Company acquired 99% of the outstanding membership interests in Van Keuren with the former members of Van Keuren retaining a 1% interest.

The New Jersey Sports and Exposition Authority has received certification of an amendment to the Solid Waste Management Plan from the New Jersey Department of Environmental Protection (“DEP”) to include the proposed operation of a municipal solid waste transfer station and material recovery facility (“TS/MRF”) at a site located in Jersey City, New Jersey. CleanTech Biofuels and Van Keuren intend to seek the necessary permits and approvals from the New Jersey DEP to build, own and operate the TS/MRF. As part of the acquisition, CleanTech acquired an option to lease the property in Jersey City within 30 days after the final permit issues from the New Jersey DEP. The Company intends to: (1) install its Biomass Recovery Process on the site, and (2) operate the TS/MRF.

Van Keuren has had no operations or revenue since inception and has solely been working towards obtaining the permits required to operate the TS/MRF. As payment for the acquisition, the Company issued in the aggregate 1,000,000 shares of restricted common stock of the Company (par value $0.001) to certain holders of membership interests in Van Keuren. As of the close of business on June 23, 2016, the Company stock quote was $0.05. The total assets of Van Keuren at the time of the acquisition were $51,000 (2.3% of the Company’s assets). The liabilities and equity consisted of accounts payable of $27,000 and member equity of $24,000. The assets consist solely of costs incurred towards obtaining the required permits and have been recorded as an intangible asset on our consolidated financial statements. This intangible will be expensed if and when the Company and Van Keuren complete the permit process and begin operations.

Biomass North America Licensing, Inc.

On September 15, 2008, the Company consummated the acquisition of Biomass North America Licensing, Inc. (“Biomass”) pursuant to a merger between Biomass and a wholly-owned subsidiary of the Company (with Biomass as the surviving subsidiary of the Company) in accordance with an Agreement and Plan of Merger by and between the Company and Biomass. By virtue of the merger, the Company acquired a license agreement pursuant to which the Company holds a license in the United States and Canada to use patented technology licensed from Biomass North America, LLC, the former parent of Biomass (the “Licensor”), to clean and separate MSW (the “Biomass Recovery Process”). In July 2010, the United States Patent and Trademark Office issued US patent number 7,745,208 for this process (the “BRP Patent”).

9

Upon consummation of the merger, the Company paid $20,000 in cash and issued a promissory note in the original principal amount of $80,000 bearing interest at an annual rate of 6% to a shareholder of the Licensor. This note has been paid in full. Additionally, the Company issued to the four shareholders of the Licensor a total of 1,895,000 shares of Common Stock and deposited an additional 4,000,000 shares of Common Stock into an escrow account (collectively, the “Shares”). The Shares were issued as part of the merger consideration received by the shareholders of the Licensor. In accordance with a November 2013 amendment, the Company has an exclusive license in the United States and Canada to use the Biomass Recovery Process that includes no performance requirements on the Company; the license agreement is for a term of 21 years from the date of the amendment or the life of any patent issued for the Biomass Recovery Process, including any amendments, modifications or extensions; the license requires that the Company pay a royalty in the amount of $2.00 per ton of MSW used in the Biomass Recovery Process to the Licensor; and the Company released the 4,000,000 shares of common stock to the Licensor previously held in escrow since the merger. The Company has recorded a long-term asset of approximately $1.6 million which it will begin to amortize upon utilizing the license in our operations.

Note 4 – Goodwill and Intangibles

Goodwill

The changes in Goodwill were as follows:

Balance at December 31, 2017	$	26,582
Additions		-
Balance at June 30, 2018	$	26,582

The Goodwill recorded was a result of the acquisition of Van Keuren in June 2016 as disclosed previously in Note 3. The amount of Goodwill represents the fair value paid for the acquisition (shares of Company common stock) in excess of the value of the net assets of Van Keuren.

Intangible Asset

The components of the Intangible Asset are as follows:

	June 30 , 2018						December 31, 2017
	Gross		Accumulated		Net Book		Gross		Accumulated		Net Book
	Amount		Amortization		Value		Amount		Amortization		Value
Van Keuren purchase	$	50,914	$	-	$	50,914	$	50,914	$	-	$	50,914

The Company’s goodwill and acquired intangible assets with indefinite lives are not amortized, but are subject to an annual impairment test. The Company performs an impairment analysis on its goodwill and intangible assets at least annually and whenever events or changes in circumstances indicate that the carrying value of such assets may not be fully recoverable. Acquired intangible assets with definite lives are amortized over their estimated useful lives and are tested for impairment only when impairment indicators are present.

Note 5 – Patent

The Company owns US Patent No. 6,306,248 (the “PSC Patent”), which is the underlying technology upon which the BRP Patent is based. The Company acquired the PSC Patent on October 22, 2008 pursuant to a Patent Purchase Agreement (“Agreement”) with World Waste Technologies, Inc. (“WWT”). As part of the acquisition of the PSC Patent, we also became the licensor of such technology under the existing license agreement between Bio-Products International, Inc., the licensee (“Bio-Products”) and WWT. The Company has paid WWT $600,000 and issued warrants to purchase 1,800,000 shares of Common Stock at $0.10 per share and 500,000 shares of Common Stock at $0.11 per share. WWT assigned all of its rights, title and interest in the note, warrants, security agreement and purchase agreement to Vertex Energy, Inc. (“Vertex”) as a result of a merger in March 2009. The warrants had an exercisable term of five years which expired on October 22, 2014. The cost of the PSC Patent acquisition of $600,000 is recorded as a long-term asset on the Balance Sheet.

10

On September 1, 2010, the Company issued a promissory note to CMS Acquisition, LLC (“CMS”) in the amount of $100,000 and bearing interest at 6.0% per annum. The note is secured with a security interest in the PSC Patent. In connection with the financing, the Company issued a warrant to CMS to purchase 2,000,000 shares of Common Stock at a price of $0.05 per share. The warrant is exercisable at any time for five years from the date of issuance or re-issuance. The note was originally to mature on February 28, 2011. The Company and CMS have entered into various amendments extending the due date, the most recent of which was April 26, 2017, which extended the due date to April 26, 2018. As consideration in the various amendments to this note, the Company has: (i) paid $30,000 towards accrued interest to date and principal on the note, (ii) increased the interest rate to 10% as of May 15, 2011, (iii) re-dated the original warrants to April 26, 2017, (iv) issued new warrants for 300,000 shares of Common Stock with an exercise price of $0.05 and exercisable at any time until April 26, 2022, (v) issued new warrants for 150,000 shares of Common Stock with an exercise price of $0.10 and exercisable at any time until April 26, 2022, and (vi) approved the assignment of the note by CMS to the WL Meyer Legacy Trust. For more information on this note, see Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations – Debt.

Note 6 – Technology Licenses

Biomass North America Licensing, Inc.

We own an exclusive license in the United States and Canada to use the Biomass Recovery Process (See Note 3 – Mergers/Acquisitions). We have recorded a long-term asset of approximately $1.6 million for the value of this license. Amortization of this asset will begin upon commencement of the use of the Biomass Recovery Process.

In accordance with a November 2013 amendment, the Company has an exclusive license in the United States and Canada to use the Biomass Recovery Process that includes no performance requirements on the Company; the license agreement is for a term of 21 years from the date of the amendment or the life of any patent issued for the Biomass Recovery Process, including any amendments, modifications or extensions; and the license requires that the Company pay a royalty in the amount of $2.00 per ton of MSW used in the Biomass Recovery Process to the Licensor.

Bio-Products International, Inc.

As disclosed in Note 5 - Patent, the Company acquired the PSC Patent in 2008 and as a result, became the licensor to Bio-Products for the PSC Patent pursuant to a Master License Agreement dated as of August 18, 2003 (the “PSC License Agreement”). Pursuant to the terms of the PSC License Agreement, Bio-Products (a wholly-owned subsidiary of Clean Earth Solutions, Inc., “CES”) is the exclusive licensee of the PSC Patent and has the right to sublicense the technology that is part of the PSC Patent (but not the BRP Patent) to any party. In addition, we are entitled to be paid 5% of any revenue derived by Bio-Products from the use of the technology and 40% of any sublicensing fees paid to Bio-Products for the use of the technology. The Master License Agreement is for a term of 20 years that commenced on August 18, 2003. On September 22, 2010, the Company sent a Notice of Breach to Bio-Products, which included removing the exclusivity of the license. We received a response from Bio-Products on November 5, 2010 disputing our claims. In February 2011, we became aware that Bio-Products effected a transfer of the license in violation of the PSC License Agreement. As a result, on March 21, 2011, we sent a notice of termination to Bio-Products and the transferee terminating the License Agreement. In June 2011, Steve Vande Vegte, a shareholder in CES, filed a lawsuit against various parties, including the Company. The only Cause of Action against the Company is for Declaratory Relief seeking to avoid our March 2011 termination of the license to which Mr. Vande Vegte is not a party. On August 5, 2011, the Company filed a demurrer requesting that the court dismiss the case on the grounds that Mr. Vande Vegte lacks standing to pursue a claim concerning the license and that the claim raised in the complaint is not ripe. The court granted our demurrer to dismiss CleanTech from this lawsuit on December 8, 2011.

25 Van Keuren LLC

As discussed in Note 3 – Mergers/Acquisitions, the Company entered into an Acquisition Agreement with 25 Van Keuren LLC (“Van Keuren”). The total assets of Van Keuren at the time of the acquisition were approximately $51,000. The assets have been recorded as an intangible asset in our consolidated financial statements. This intangible will be expensed if and when the Company and Van Keuren complete the permit process and begin operations.

All intangible assets are reviewed for impairment whenever events or other changes in circumstances indicate that the carrying amount may not be recoverable. An impairment charge is recognized if the carrying amount of an intangible asset exceeds its implied fair value.

11

Note 7 – Debt

	June 30, 2018			December 31, 2017
Convertible Notes Payable (2009 Offering), which are made up of various individual notes with an aggregate face value of $189,185 at June 30, 2018 and December 31, 2017, due one year from date of note, interest at 6.0%	$	189,185		$	189,185
Convertible Notes Payable (11/10 Offering), which are made up of various individual notes with an aggregate face value of $1,877,162 at June 30, 2018 and December 31, 2017, due one year from date of note, interest at 6.0%		1,877,162			1,877,162
WL Meyer Legacy Trust (formerly CMS Acquisition LLC) Note Payable, with a face value of $72,696 at June 30, 2018 and December 31, 2017, due on April 26, 2018, interest at 6.0% thru May 15, 2011; 10.0% thereafter		72,696			72,696
Convertible Notes Payable (5/12 Offering), made up of various individual notes with a face value of $583,510, due in 18 months from date of note, interest at 6.0%		583,510			583,510
Convertible Note Payable (2/14 Offering), which is made up of one note with a face value of $100,000 due in 18 months from date of note, interest at 6.0%		100,000			100,000
Convertible Note Payable (2015 Offering), which is made up of one note with a face value of $85,000 due in 18 months from date of note, interest at 6.0%		85,000			85,000
Note Payable, which is made up of one note with a face value of $50,000 due in six months from the date of note, interest at 9.0%		-			50,000
Note Payable, which is made up of one note with a face value of $35,000 due in six months from the date of note, interest at 9.0%		-			35,000
Note Payable, which is made up of one note with a face value of $15,000 due March 2017, interest at 6.0%		15,000			15,000
Note Payable, which is made up of one note with a face value of $25,000 due October 2018, interest at 6.0%		25,000			25,000
Convertible Note Payable, which is made up of one note with a face value of $97,599 due March 2019, interest at 6.0%		97,599			-
Convertible Note Payable, which is made up of one note with a face value of $50,000 due March 2019, interest at 6.0%		50,000			-
Convertible Note Payable, which is made up of one note with a face value of $17,000 due March 2019, interest at 6.0%		17,000			-
Convertible Note Payable, which is made up of one note with a face value of $30,000 due May 2019, interest at 6.0%		30,000			-
Total debt		3,142,152			3,032,553
Current maturities		(3,142,152	)		(3,032,553	)
Long-term debt	$	-		$	-

Convertible Notes Payable - Since September 2008, the Company has conducted six offerings of units comprised of a convertible promissory note and a warrant, and one offering of a convertible note (with no warrant), having the terms set forth below:

Offering	Note Interest Rate		Note Conversion Price		Warrant Exercise Price		Term	Closed or Open
2008 Offering		6.0%		$0.25		$0.45	One-year	Closed
2009 Offering		6.0%		$0.08		$0.30	One-year	Closed
6/10 Offering		12.0%		$0.08		$0.30	One-year	Closed
11/10 Offering		6.0%		$0.06		$0.30	One-year	Closed
5/12 Offering		6.0%		$0.10		$0.35	18 months	Closed
2/14 Offering		6.0%		$0.10		n/a	18 months	Closed
2015 Offering		6.0%		$0.10		$0.15	18 months	Closed

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Each note holder retains the option of a cash repayment of the note plus interest, or the note can be converted at any time during the term of the note or prior to the closing of any Qualifying Equity Financing (minimum capital received of $5 million), into shares of Common Stock at the conversion price noted above. All notes have been recorded as debt (notes payable) in the consolidated financial statements, net of discounts for the conversion and warrant features (except for the 11/10, 5/12, 2/14, and 2015 Offerings which carried no discounts). See Note 12 - Subsequent Events for further disclosure regarding our notes.

2008 Offering - During September 2008, the Company commenced an offering of units and raised a total of $642,000 of investment proceeds through March 31, 2009. As of March 31, 2010, all of these notes had either been converted to shares of our common stock or exchanged into our 2009 Offering (resulting in new notes with a total face value of $539,829, which included the original principal and interest through the date of exchange).

2009 Offering - During April 2009, the Company commenced an offering of units and raised a total of $1,198,500 of investment proceeds through August 2010. Four notes have been converted to shares of Common Stock (one each in 2009, 2010, 2014 and 2017). Beginning in March 2011, certain notes were exchanged into our 11/10 Offering. As a result, as of June 30, 2018, we had $189,185 face value of notes outstanding, which includes the exchanged notes from our 2008 Offering. All of these notes have matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

6/10 Offering - During June 2010, the Company commenced an offering of units and raised a total of $75,000 of investment proceeds in one note. Upon maturity in June 2011, this note was exchanged into our 11/10 Offering. As a result, the balance due on this offering is $-0-.

11/10 Offering - During November 2010, the Company commenced an offering of units and raised a total of $451,713 of investment proceeds. Three notes were converted to shares of Common Stock during 2011 and four notes were converted to shares of Common Stock in 2012. As of June 30, 2018, we had $1,877,162 face value of notes outstanding, which includes exchanged notes from our 2009 Offering. As of June 30, 2018, all of the notes have matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

5/12 Offering - During May 2012, the Company commenced an offering of units and raised a total of $583,510 of investment proceeds. As of June 30, 2018, all of these notes were outstanding and matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

2/14 Offering - During February 2014, the Company commenced an offering of units and raised a total of $100,000 of investment proceeds in one note. As of June 30, 2018, this note is outstanding and has matured. We plan to work with the note holder to exchange, convert or repay this note.

2015 Offering - During September 2015, the Company commenced an offering of units and raised a total of $85,000 of investment proceeds in one note. As of June 30, 2018, this note is outstanding and matured. We plan to work with the note holder to exchange, convert or repay this note.

WL Meyer Legacy Trust (formerly CMS Acquisition, LLC) Note Payable - In September 2010, the Company issued a note in the amount of $100,000 (interest at 6.0% per annum through May 15, 2011 and 10.0% thereafter and secured by a security interest in the PSC Patent) and issued warrants to purchase 2,000,000 shares of Common Stock at a price of $0.05 per share. Under the terms of an amendment to this note dated April 26, 2017, this note matured on April 26, 2018. The warrants are exercisable at any time for five years from the date of issuance or reissuance. The value of these warrants has been recorded as a contra-balance amount discount with the note and was fully amortized (interest expense) as of February 28, 2011 (the original due date). As consideration in the various amendments to this note, the Company has: (i) paid $30,000 towards accrued interest to date and principal on the note, (ii) increased the interest rate to 10% as of May 15, 2011, (iii) re-dated the original warrants to April 26, 2017, (iv) issued new warrants for 300,000 shares of Common Stock with an exercise price of $0.05 and exercisable at any time until April 26, 2022, (v) issued new warrants for 150,000 shares of Common Stock with an exercise price of $0.10 and exercisable at any time until April 26, 2022, and (vi) approved the assignment of the note by CMS Acquisition LLC to the WL Meyer Legacy Trust. As of June 30, 2018, $72,696 face value of this note is outstanding. We plan to work with the note holder to renew or repay the note.

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7.1.15 Convertible Note Payable - On July 1, 2015, one noteholder in our 2009 Offering exchanged two notes into this note. This new note carries a 6% annual interest, compounded annually, and is due in quarterly installment payments: the greater of $3,000 or 10% of all investment proceeds received during the calendar quarter preceding the quarterly installment payment. As of June 20, 2018, this note has been paid in full.

June and October 2016 Note Payable –The Company issued two notes payable, with no conversion feature, to a current Board of Directors member, in the amounts of $50,000 and $35,000, respectively. In March of 2018, both notes were replaced with a convertible note payable with a face value of $97,599, and a 6% interest rate, due March 2019.

January 2017 Note Payable – The Company issued a note payable, with no conversion feature, to William Meyer in the amount of $15,000, with a 6% interest rate, which was due March 20, 2017. We are currently working with the note holder to renew or repay the note.

October 2017 Note Payable – The Company issued a note payable, with no conversion feature, to a current Board of Directors member, in the amount of $25,000, with a 6% interest rate, due October 2018. As of June 30, 2018, the note was outstanding.

March 2018 Notes Payable – The Company issued two convertible notes payable to a current Board of Directors member in the amounts of $50,000 and $17,000, respectively, with a 6% interest rate, due March 2019. As of June 30, 2018, the notes were outstanding.

May 2018 Note Payable – The Company issued a convertible note payable to a current Board of Directors member in the amount of $30,000, with a 6% interest rate, due May 2019. As of June 30, 2018, the note was outstanding.

The discounts on all notes payable have been amortized on a straight-line basis over the original term of each note. All discounts were fully amortized and expensed as of June 30, 2018. The following is a summary of warrants issued and outstanding as of the dates below, at the exercise price and the number of shares of Common Stock (these warrants have not been exercised or converted to shares of Common Stock).

	Exercise		June 30,		December 31,
Warrants issued to:	Price		2018		2017
Noteholders, 11/10 Offering		$0.30		-		398,221
Noteholder in 2015 Offering		$0.15		2,550,000		2,550,000
Investors in Subscription Agreements (a)		$0.15		6,300,000		9,300,000
WL Meyer Legacy Trust		$0.05		2,300,000		2,300,000
WL Meyer Legacy Trust		$0.10		150,000		150,000
				11,300,000		14,698,221

(a) Warrants issued to investors under these Subscription Agreements can be exercised anytime within three years from date of Agreement. These warrants currently expire at various dates from August 2018 to April 2022.

Note 8 – Stockholders' Equity (Deficit)

In August 2013, the Company commenced an offering of units, under a Subscription Agreement, at a purchase price of $1,000 per unit (Equity Offering 8/13). Each unit consists of: (i) 10,000 shares of the Company’s authorized but unissued restricted Common Stock and (ii) warrants to purchase 30,000 additional shares of Common Stock for a three-year period from the date of issuance of the units at an initial exercise price of $0.15 per share. As of June 30, 2018, the Company issued 7,635,000 restricted shares (at $0.10 per share) of our Common Stock in exchange for $763,500 in investment in this offering. See Note 12 - Subsequent Events for further updates to this offering and other share grants affecting Stockholders’ Equity.

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In February 2016, the Board approved a grant to certain Board members and management for an aggregate of 4,000,000 shares of restricted Common Stock (at $0.013 per share). The Board granted these awards in recognition of the efforts of the recipients towards the furtherance and implementation of the Company’s strategic plan and to induce the recipients to continue those efforts on behalf of the Company. Based on the foregoing, the Board determined such grants were in the best interest of the Company and its stockholders. 

In June 2016, the Company completed an acquisition of Van Keuren, as previously disclosed in Note 3, and issued in the aggregate 1,000,000 shares of restricted Common Stock of the Company (at $0.05 per share) to certain holders of membership interests in Van Keuren. 

In August 2016, a note receivable from a former director matured and was not paid. The note was originally issued in August 2007 to purchase shares of our Common Stock. As a result, 150,000 shares of restricted Common Stock, issued at $0.15 per share were forfeited and cancelled.

In September 2016, the Company issued 750,000 shares of restricted Common Stock to a consultant for business transactions and financing services to be provided over a one-year term.

In May 2017, the Company issued 100,000 shares of restricted Common Stock to a consultant for accounting services provided to the Company.

In July 2017, the Company issued 200,000 shares of restricted Common Stock to a consultant for accounting services provided to the Company.

In August 2017, the Company granted 3,000,000 shares of restricted Common Stock to consultants for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey markets to be provided over a two-year term. Of the 3,000,000 shares of restricted Common Stock granted, 2,000,000 were issued.

In September 2017, the Company issued 204,996 shares of Common Stock ($0.08 per share) to an investor on conversion of a Convertible Note.

In December 2017, a note receivable from an employee matured and was not paid. The note was originally issued in December 2008 to purchase shares of our Common Stock. As a result, 60,000 shares of restricted Common Stock, issued at $0.36 per share were forfeited and cancelled.

For more information regarding these notes, see Part II—Other Information: Item 4 – Default on Senior Securities.

In March 2018, the Company issued 250,000 shares of restricted Common Stock to a consultant for legal / corporate finance services provided to the Company.

In March 2018, the Company issued the remaining 1,000,000 shares of restricted Common Stock granted in August of 2017, to a consultant for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey markets.

In April 2018, the Company issued 200,000 shares of restricted Common Stock to a consultant for accounting services provided to the Company.

Net Loss per share – The Company calculates basic loss per share (“EPS”) and diluted EPS. EPS is computed as net earnings (loss) divided by the weighted average number of common shares outstanding for the period. Diluted EPS would reflect the potential dilution that could occur from common shares issuable through stock options, warrants and other convertible securities. As of June 30, 2018 and December 31, 2017, the Company had options, warrants and other convertible securities to purchase an aggregate of approximately 87 million and 85 million shares, respectively, of our Common Stock, that were excluded from the calculation of diluted loss per share as their effects would have been anti-dilutive. Therefore, the Company only presents basic loss per share on the statement of operations.

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Note 9 – Related Party Transactions

The Company has entered into stock purchase agreements with its executive officers and certain members of the Board of Directors (“Board”). The executive officers and directors issued notes to the Company in exchange for their stock purchases. These notes and accumulated interest are recorded as notes receivable in Stockholders’ Deficit.

In September 2013, the Company hired, on a part-time basis, a Chief Technology Officer (“CTO”) and a VP-Business Development (“VP-BD”). These individuals maintain their engineering firm Fenton Engineering International (“FEI”) on a full-time basis and receive no salary in their part-time positions but are eligible for grants of stock options. We have used and continue to use their services. As of June 30, 2018, all amounts have been paid to FEI except for approximately $48,000.

Two members of our current Board, James Russell and David Bransby, are parties in investments made in our convertible note offerings. As of June 30, 2018 and December 31, 2017, their aggregate investment in our note offerings including interest, is approximately $937,000 and $760,000, respectively.

Beginning in 2009, the Company has provided advances to two employees – Ed Hennessey and Mike Kime. Mr. Kime resigned from his position with the Company effective June 21, 2010. As of June 30, 2018 and December 31, 2017, the aggregate balance of Mr. Hennessey’s advances totaled approximately $14,000. Mr. Kime’s advances were netted against monies due and paid to him in 2016 pursuant to a settlement agreement following his departure from the Company. The balance of Mr. Hennessey’s advances is included in Prepaids and Other Current Assets on the Balance Sheet.

In June and October of 2016, the Company issued notes payable, with no conversion feature, to a current Board of Directors member, in the amounts of $50,000 and $35,000, respectively. In March of 2018, both notes were replaced with a convertible note payable with a face value of $97,599, and a 6% interest rate, due March 2019.

In February of 2017, the Company received $50,000 from a Board member in exchange for 500,000 shares of common stock.

In June of 2017, the Company received $50,000 from a Board member in exchange for 500,000 shares of common stock.

In October of 2017, the Company issued a note payable with no conversion feature, to a current Board member in the amount of $25,000, with a 6% interest rate, due October 2018. As of June 30, 2018, the note was outstanding.

In March of 2018, the Company issued two convertible notes payable to a current Board member in the amounts of $50,000 and $17,000, respectively, with a 6% interest rate, due March 2019. As of June 30, 2018, the notes were outstanding.

In May of 2018, the Company issued a convertible note payable to a current Board of Directors member in the amount of $30,000, with a 6% interest rate, due May 2019. As of June 30, 2018, the note was outstanding.

Note 10 – Share-based Payments

The Company recognizes share-based compensation expense for all share-based payment awards including stock options and restricted stock issued to employees, directors and consultants and is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period. The Company has no awards with market or performance conditions.

In March 2007, the Company assumed and adopted the 2007 Stock Option Plan (“Stock Plan”) for its employees, directors and consultants, which includes an equity compensation plan for non-employee directors pursuant to which stock options and shares of restricted stock may be granted.  The Company currently has reserved a maximum of 14,000,000 shares of common stock to be issued for stock options or restricted shares awarded under the Stock Plan.

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In September 2013, the Company granted options under the Stock Plan to purchase an aggregate of 1,000,000 shares of Common Stock to two part-time employees (newly hired CTO and VP–BD) in which one-third will vest ratably beginning in September 2014, with an exercise price of $0.10. As of June 30, 2018, none of these options were cancelled or expired and 1,000,000 shares of these options were vested.

In February 2015, the Company granted options under the Stock Plan to purchase an aggregate of 350,000 shares of Common Stock to a consultant, with an exercise price of $0.10. As of June 30, 2018, none of these options were cancelled or expired and 350,000 shares of these options were vested.

In February 2016, the Board approved Common Stock grants to a member of management, and certain Board members, for 4.0 million shares, in the aggregate, of restricted Common Stock. Additionally, the Board approved the issuance of stock option agreements to a member of management and certain consultants for the purchase of 3.5 million shares, in the aggregate, of Common Stock. The Board granted these awards in recognition of the efforts of the recipients towards the furtherance and implementation of the Company’s strategic plan and to induce the recipients to continue those efforts on behalf of the Company. Based on the foregoing, the Board determined the grants were in the best interest of the Company and its stockholders. All of the share grant awards vest immediately and were issued pursuant to Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”), or Section 4(a)(2) of the Securities Act, and will therefore be “restricted securities” as such term is used in Rule 144 of the Securities Act. The option agreements were issued outside of the Company’s 2007 Stock Option Plan and carry the following terms: seven-year agreements, vesting in thirds ratably over three years, and are exercisable at the Company’s closing stock price as of the date of the grant. These options were calculated to have no value. Accordingly, there was no share-based compensation expense recorded in general and administrative expense.

In February 2016, the Company issued a stock option agreement to a consultant for the purchase of 100,000 shares of Common Stock. The option agreement was issued outside of the Company’s 2007 Stock Option Plan and carries the following terms: seven-year agreement, vesting in thirds ratably over three years, and are exercisable at the Company’s closing stock price as of the date of the grant. These options were calculated to have no value. Accordingly, there was no share-based compensation expense recorded in general and administrative expense.

In May 2017, the Company issued 100,000 shares of restricted Common Stock to a consultant for accounting services provided to the Company.

In July 2017, the Company issued 200,000 shares of restricted Common Stock to a consultant for accounting services provided to the Company.

In August 2017, the Company granted 3,000,000 shares of restricted Common Stock to consultants for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey markets to be provided over a two-year term. Of the 3,000,000 shares of restricted Common Stock granted, 2,000,000 were issued.

In March 2018, the Company issued 250,000 shares of restricted Common Stock to a consultant for legal / corporate finance services provided to the Company.

In March 2018, the Company issued the remaining 1,000,000 shares of restricted Common Stock granted in August of 2017, to a consultant for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey markets.

In April 2018, the Company issued 200,000 shares of restricted Common Stock to a consultant for accounting services provided to the Company.

As of June 30, 2018, there was $42,800 in prepaids for compensation costs related to all share-based payment arrangements. There were 3,600,000 options granted with 2,400,000 shares vested as of June 30, 2018 which have a weighted-average exercise price of $0.13. The remaining 1,200,000 options will vest in February 2019.

Stock option expense is recognized in the statements of operations ratably over the vesting period based on the number of options that are expected to ultimately vest. Our options have characteristics significantly different from those of traded options and changes in the assumptions can materially affect the fair value estimates. The Company incurred no share-based compensation expense related to option grants for the six months ended June 30, 2018 and 2017.

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The following table summarizes the Company's stock option activity and related information under the Stock Plan:

	Shares Under Option			Weighted-Avg Exercise Price		Aggregate Intrinsic Value
Options outstanding as of December 31, 2017		8,345,000		$	0.10		(1)
Granted		-
Forfeited		(250,000	)
Options outstanding as of June 30, 2018		8,095,000			0.11		(1)
Options exercisable as of June 30, 2018		8,095,000			0.11

(1)  The weighted-average exercise price at June 30, 2018 and December 31, 2017 for all outstanding and exercisable options was greater than the fair value of the Company's common stock on that date, resulting in an aggregate intrinsic value of $-0-.

The following table summarizes information about the Company's issuances of restricted stock under the Stock Plan:

	Restricted shares issued		Weighted-Avg Issuance Price
Balance as of December 31, 2017		960,000		$0.10
Granted		-		$0.10
Forfeited		-		$0.10
Balance as of June 30, 2018		960,000		$0.10

In February 2016, the Company issued to members of management and a consultant 3,600,000 options outside of the Stock Plan. The options granted were in recognition of the efforts of the recipients towards the furtherance and implementation of the Company’s strategic plan and to induce the recipients to continue those efforts on behalf of the Company.

The Company has issued the following grants outside of the Stock Plan: (1) restricted Common Stock: (i) in January 2015 for 500,000 shares to a member of management, (ii) in January 2014 for 500,000 shares to a consultant to provide services regarding the collection, recycling, transfer, and disposal of MSW, (iii) in April 2014, to certain Board members and management for 4,250,000 shares in the aggregate, (iv) in February 2016, to certain Board members and a member of management for 4,000,000 shares in the aggregate, (v) in May 2017 for 100,000 shares to a consultant for accounting services provided, (vi) in July 2017 for 200,000 shares to a consultant for accounting services provided (vii) in August 2017 for 3,000,000 shares to a consulting group for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey and (viii) in March 2018 for 250,000 shares to a consultant for legal services provided, (ix) in April 2018 for 200,000 shares to a consultant for accounting services provided (2) in February 2016, the Board approved the issuance of stock option agreements to a member of management and certain consultants for the purchase of 3,600,000 shares, in the aggregate, of Common Stock. The shares and options issued to Board members and management were in recognition of the efforts of the recipients towards the furtherance and implementation of the Company’s strategic plan and to induce the recipients to continue those efforts on behalf of the Company. Total expense related to these grants for the six months ended June 30, 2018 and 2017, was $7,200 and $3,200, respectively (included in our general and administrative expense for employees and professional fees for consultants).

All of the share grant awards vest immediately and were issued pursuant to Regulation D promulgated under the Securities Act, or Section 4(a)(2) of the Securities Act, and will therefore be “restricted securities” as such term is used in Rule 144 of the Securities Act. The option agreements carry the following terms: seven-year agreements, vesting in thirds ratably over three years, and are exercisable at the Company’s closing stock price as of the date of the grant.

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Note 11 – Commitments and Contingencies

Commitments

Lease – The Company leases approximately 1,800 square feet of office space for use as our corporate office, located at 7386 Pershing Ave. in St. Louis, Missouri. The original lease term expired in December 2016, however, we are continuing to lease on a month-to-month basis.  Our monthly rent under the lease is $1,800 plus the cost of utilities.

Contingencies

See Item 1. Legal Proceedings in the Other Information section below.

Note 12 – Subsequent Events

All of the promissory notes in our 2009, 5/12, 11/10, 2/14 and 2015 Offerings are now due. As of August 13, 2018, approximately $4.0 million is currently due, including interest. We plan to work with each remaining note holder to exchange, convert or repay these promissory notes.

In August of 2018, the Company issued a convertible note payable, to a current Board of Directors member, in the amount of $20,000.

Note 13 – Going Concern

During the six months ended June 30, 2018, the Company had a net loss of $345,000, negative cash flow from operations of $98,000 and negative working capital of $6.7 million. Additionally, the Company has significant debt currently due. Management has performed its evaluation of the entity’s ability to continue as a going concern and was not able to alleviate the substantial doubt about the Company’s ability to continue as a going concern within one year after August 14, 2018, the date these consolidated financial statements were available for issue.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Statement Regarding Forward-Looking Information

From time to time, we make written or oral statements that are “forward-looking,” including statements contained in this report and other filings with the Securities and Exchange Commission (“SEC”) and in our reports to stockholders. The Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended, provide a safe harbor for such forward-looking statements. All statements, other than statements of historical facts, included herein regarding our strategy, future operations, financial position, future revenues, projected costs, prospects, plans, objectives and other future events and circumstances are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “would,” “should” and similar expressions or negative expressions of these terms. Such statements are only predictions and, accordingly, are subject to substantial risks, uncertainties and assumptions.

Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. We caution you that any forward-looking statement reflects only our belief at the time the statement is made. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee our future results, levels of activity, performance or achievements. Refer to our Risk Factors section of our annual report on Form 10-K for the year ended December 31, 2017, filed with the SEC on April 2, 2018, for a full description of factors we believe could cause actual results or events to differ materially from the forward-looking statements that we make. These factors include:

● our ability to raise additional capital on favorable terms or identify another source of outside liquidity,

● our ability to continue operating and to implement our business plan,

● the commercial viability of our technologies,

● our ability to maintain and enforce our exclusive rights to our technologies,

● the demand for and production costs of various energy products that could be made from our biomass,

● competition from other alternative energy technologies, and

● other risks and uncertainties detailed from time to time in our filings with the SEC.

Although we believe the expectations reflected in our forward-looking statements are based upon reasonable assumptions, it is not possible to foresee or identify all factors that could have a material and negative impact on our future performance. The forward-looking statements in this report are made on the basis of management’s assumptions and analyses as of the time the statements are made, in light of their experience and perception of historical conditions, expected future developments and other factors believed to be appropriate under the circumstances.

Company Overview

The following discussion of our Company Overview, Recent Developments and Plan of Operation should be read in conjunction with the consolidated financial statements and related notes to the consolidated financial statements included elsewhere in this report. This discussion contains forward-looking statements that relate to future events or our future financial performance. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance. These risks and other factors include, among others, those listed under “Statement Regarding Forward-Looking Information.”

The Company is in its development stage and is focused on being a provider of: (i) cellulosic biomass derived from municipal solid waste, also known as MSW, as a feedstock for producing energy and other chemical products and (ii) recyclables (metals, plastics, glass) from the MSW. We are the exclusive licensee in the United States and Canada of patented technology, which we refer to as our Biomass Recovery Process, that cleans and separates MSW and generates a clean, homogeneous biomass feedstock that we believe can be converted into various energy products. Our license permits us to use the biomass we derive from MSW to produce all energy products. In addition, we own the patent for a pressurized steam classification technology originally developed by the University of Alabama in Huntsville that we refer to as our PSC technology. The PSC technology is the underlying technology upon which the Biomass Recovery Process is based. Prior to March 2011, we had licensed the PSC technology to Bio-Products International, Inc. (“Bio-Products”). However, pursuant to a settlement agreement with Bio-Products in March 2009, we had the right to use the Biomass Recovery Process technology worldwide, for any product that we desired and with no royalty due to Bio-Products. We terminated the license to Bio-Products in March 2011 as further described in the section entitled “Intellectual Property Terms.” The Company has spent $-0- on research and development activities for the six months ended June 30, 2018 and 2017.

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We are a Delaware corporation. We were originally incorporated in 1996 as Long Road Entertainment, Inc., and were formed to operate as a holding company for businesses in the theater, motion picture and entertainment industries. We ceased conducting that business in 2005 and were dormant until the fall of 2006, at which time our founder and then controlling stockholder decided to pursue the sale of the company. In anticipation of that sale, we changed our name to Alternative Ethanol Technologies, Inc.

On March 27, 2007, we entered into an Agreement and Plan of Merger and Reorganization in which we agreed to acquire SRS Energy, Inc., a Delaware corporation that at that time was seeking to commercialize various technologies for the processing of waste materials into usable products. We consummated the merger on May 31, 2007 resulting in SRS Energy becoming our wholly-owned subsidiary. Effective August 2, 2007, we changed our name to CleanTech Biofuels, Inc.

We have no operating history as a producer of biomass feedstocks or any energy products and have not constructed any operating plants to date. We have not earned any revenues to date and our current capital and other existing resources are not sufficient to fund the implementation of our business plan or our required working capital. We will require substantial additional capital to implement our business plan and we may be unable to immediately obtain the capital required to continue operating.

Recent Developments

Acquisition of 25 Van Keuren LLC

On June 23, 2016, CleanTech entered into an Acquisition Agreement with 25 Van Keuren LLC, a New Jersey Limited Liability Company (“Van Keuren”) pursuant to which the Company acquired 99% of the outstanding membership interests in Van Keuren and the former members of Van Keuren retained a 1% interest.

The New Jersey Sports and Exposition Authority has received certification of an amendment to the Solid Waste Management Plan from the New Jersey Department of Environmental Protection (“DEP”) to include the proposed operation of a municipal solid waste transfer station and material recovery facility (“TS/MRF”) at a site located in Jersey City, New Jersey. CleanTech and Van Keuren intend to seek the necessary permits and approvals from the New Jersey DEP to build, own and operate the TS/MRF. As part of the acquisition, CleanTech acquired an option to lease the property located in Jersey City within 30 days after the final permit issues from the New Jersey DEP. The Company intends to: (1) install its Biomass Recovery Process on the site, and (2) operate the TS/MRF.

Van Keuren has had no operations or revenue since inception and has solely been working towards obtaining the permits required to operate the TS/MRF. As payment for the acquisition, the Company issued in the aggregate 1,000,000 shares of restricted Common Stock of the Company (par value $0.001) to certain holders of membership interests in Van Keuren. As of the close of business on June 23, 2016, the Company stock quote was $0.05. The total assets of Van Keuren at the time of the acquisition were $51,000 (2.3% of the Company’s assets). The liabilities and equity consisted of accounts payable of $27,000 and member equity of $24,000. The assets consist solely of costs incurred towards obtaining the required permits and have been recorded as an intangible asset on our consolidated financial statements. This intangible will be expensed if and when the Company and Van Keuren complete the permit process and begin operations.

Investments

In August 2013, the Company commenced an offering of units, under a Subscription Agreement, at a purchase price of $1,000 per unit (Equity Offering 8/13). Each unit consists of: (i) 10,000 shares of the Company’s authorized but unissued restricted common stock, par value $0.001 (“Common Stock”) and (ii) warrants to purchase 30,000 additional shares of Common Stock for a three-year period from the date of issuance of the units at an initial exercise price of $0.15 per share. As of August 13, 2018, the Company has issued 7,635,000 restricted shares of our Common Stock in exchange for $763,500 in investment in this offering.

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All of the promissory notes in our 2009, 5/12, 11/10, 2/14 and 2015 Offerings are now due. As of August 13, 2018, approximately $4.0 million is currently due, including interest. We will work with each remaining note holder to exchange, or convert, these promissory notes. There can be no assurance that we will reach agreements with any or all of these note holders and we may be required to repay such amounts.

In May of 2018, the Company issued a convertible note payable to a current Board of Directors member in the amount of $30,000, with a 6% interest rate, due May 2019. As of June 30, 2018, the note was outstanding.

In August of 2018, the Company issued a convertible note payable, to a current Board of Directors member, in the amount of $20,000.

Plan of Operation

Our focus is to secure sufficient capital to fund our current working capital requirements and the construction of a commercial plant as described further in this section. We have had an ongoing lack of liquidity, and currently do not have sufficient capital to continue to fund our proposed operations and are relying on the minimal assets on hand to fund our limited operations and corporate existence. All of our on-going and proposed developments/projects require a significant amount of capital that we currently do not have. While we continue to pursue outside sources of funding, we have not had success securing meaningful amounts of outside capital in recent years. As a result, we can provide no assurance that we will secure any source of funding in the immediate time frame required and the failure to do so will likely result in an inability to continue operations.

Our company was initially conceived as a fully-integrated producer of cellulosic ethanol from MSW. Based on our investigation and acquisition of new technologies and research and development of our existing technologies in 2008, we re-focused our business to the commercialization of our Biomass Recovery Process technology for cleaning and separating MSW into its component parts and initiated a plan to consolidate the ownership and/or rights to use intellectual property around this technology. The technology is currently in commercial use in Coffs Harbor, Australia by an operator not owned by the Company (the “Third-Party Operator”). As a result, we believe this technology could be implemented commercially in the United States and elsewhere. In furtherance of our focus, we are continuing our ongoing search for an outside source of financing that will provide the capital for us to design, build, and operate a commercial biomass recovery plant that will allow us to produce biomass feedstock for customer evaluation, trial purchases, and/or be used in equipment selection for power generation and possibly combined heat and power ("CHP") production. Initially, the biomass feedstock output is expected to be sold or provided to electric utilities, power and steam producers, power and CHP equipment suppliers, and biofuel research firms for evaluation. In addition to seeking a source of funding for plant development, the Company hopes to license and/or develop potential commercial projects as they present themselves. All of our developments plan to focus on cleaning and separating MSW into its component parts in order to obtain: (i) a homogenous feedstock of cellulosic biomass for producing energy and other chemical products and (ii) recyclable products (metals, plastics). Our plans may also include the possibility of operating an MSW transfer station where we could install our technology.

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Jersey City

With our acquisition of Van Keuren, as described earlier under Recent Developments, the Company’s primary focus is to seek the capital required to obtain the necessary permits and approvals from the New Jersey DEP and to build, own and operate the TS/MRF in Jersey City, NJ. As part of the acquisition, CleanTech acquired an option to lease the property located in Jersey City and intends to: (1) install its Biomass Recovery Process on the site, and (2) operate the TS/MRF. The Company may initially operate this location as a transfer station (after receiving the required permits and approvals) while designing and installing our Biomass Recovery Process equipment on the site. The biomass feedstock output would then be expected to be sold or provided to electric utilities, power and steam producers, power and CHP equipment suppliers, and biofuel and chemical research firms for evaluation.

Biomass Feedstock Production

We are working to develop one or more other locations where waste collected would be processed using our technology and the biomass produced used to create heat and/or power. Initially, the biomass feedstock output is expected to be sold or provided to electric utilities, power and steam producers, power and CHP equipment suppliers, and biofuel and chemical research firms for evaluation. In addition to research and development, the Company also plans to license and/or develop potential commercial projects.

In addition to the developments we are currently contemplating, from time to time other development opportunities are presented to us and we evaluate those potential developments. If we are able to operate a plant, and thereafter refine our know-how with respect to implementation of the technology, we intend to seek to partner with waste haulers, landfill owners and municipalities to implement the technology across the United States and internationally.

Any development of commercial plants and/or implementation of the licensing of our technology described above will require significant additional capital, which we currently do not have. To date, we have not been successful in raising the amount of capital necessary to implement our business plan and we cannot provide any assurance that we will be able to raise sufficient additional capital. While we anticipate that financing for the commercial biomass recovery plant and these other potential projects could also be provided in part via tax exempt bond financing or through the use of loan guarantees from local, state and federal authorities, we have not secured any such financing and there can be no assurance that we will be able to secure any such financing.

Bio-Fuel and Bio-Chemical Joint Testing/Research

If we are able to process MSW into biomass through our potential future biomass recovery plant and/or in future commercial vessels, we hope to enter into joint research agreements with companies looking to process biomass in their system(s) for various types of energy and chemical production. We believe that this testing and research could provide possible revenue streams, projects and additional opportunities for use of our biomass.

In February 2012, we entered into a Confidentiality Agreement and Material Transfer Agreement with Sweetwater Energy, Inc. (“Sweetwater”), a renewable energy company with patent-pending technology to produce sugars from several types of biomass for use in the biofuel, biochemical and bioplastics markets. We agreed and coordinated with the Third-Party Operator in Australia to ship 10 pounds of biomass produced at the Third-Party Operator’s facility to the Sweetwater lab for testing. The shipment arrived in May 2012 and Sweetwater has completed their initial testing. In June 2011, we entered into a Confidential Disclosure and Sampling Agreement with Novozymes North America, Inc., a developer of industrial enzymes, microorganisms, and biopharmaceutical ingredients for conversion into a variety of energy and chemical products. In July 2011, we supplied a sample of our biomass product for testing in their enzymatic hydrolysis process. Some initial testing was completed during the 3^rd Quarter of 2011. We expect further testing to occur for both of these companies and for possible additional companies upon securing the requisite financing to build a biomass recovery plant to process MSW.

New Technologies; Commercializing Existing Technologies

Because of our ability to produce a clean, homogenous biomass feedstock, we may be presented with the opportunity to partner with or acquire new technologies once we become operational. In addition to developing our current technologies, we intend to continue to add technologies to our suite of solutions that complement our core operations. We believe that our current technologies and aspects of technologies in development or contemplation will enable us to eventually expand our business to use organic material from other waste streams such as municipal bio-solids from waste water facilities and animal waste for fuel production.

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To commercialize our technology, we anticipate we will need to:

● construct and operate a commercial plant that: (i) processes MSW into cellulosic biomass for conversion into energy or chemical products and (ii) separates recyclables (metals, plastics, glass) for single-stream recycling;

● identify and partner with landfill owners, waste haulers and municipalities to identify locations suitable for our technology; and

● pursue additional opportunities to implement our technology in commercial settings at transfer stations and landfills in our licensed territories.

Our ability to implement this strategy is heavily dependent on our ability to raise significant amounts of additional capital and to hire appropriate managers and staff. Our success will also depend on a variety of market forces and other developments beyond our control.

Results of Operations

The following tables set forth the amounts of expenses and changes in our consolidated statements of operations for the three and six months ended June 30, 2018 and 2017. The Company’s activities and related primary expenses are in the following categories: General and administrative – payroll (including share-based compensation, stock grants, and payroll taxes), general office expenses, travel, and business insurance; Professional fees - consulting, accounting and legal fees; Other expense (income) – interest expense on convertible notes payable and interest income on notes receivable related to restricted stock grants.

	Three months ended June 30,
	2018			2017			Change
Costs and expenses:
General and administrative	$	61,121		$	61,529		$	(408	)
Professional fees		41,115			27,107			14,008
		102,236			88,636			13,600
Other expense (income):
Interest expense		63,817			63,172			645
Interest income, net of accrued interest written-off		(908	)		(1,245	)		337
Net loss applicable to common stockholders	$	165,145		$	150,563		$	14,582

Professional Fees – The increase in professional fees was due to legal fees regarding a complaint filed against the Company. See Part II. Other Information: - Item 1. Legal Proceedings for further discussion.

Interest Expense – The increase was due to the compounding effect of interest on our notes payable.

	Six months ended June 30,
	2018			2017			Change
Costs and expenses:
General and administrative	$	114,859		$	118,504		$	(3,645	)
Professional fees		106,631			69,930			36,701
		221,490			188,434			33,056
Other expense (income):
Interest expense		125,205			115,470			9,735
Interest income, net of accrued interest written-off		(1,793	)		(2,481	)		688
Net loss applicable to common stockholders	$	344,902		$	301,423		$	43,479

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General and Administrative – The decrease in 2018 was due to a decrease in insurance of $16,000, partially offset by a restricted stock grant to a consultant of $4,000 and $7,000 increase in corporate filling fees / permits.

Professional Fees – The increase in professional fees was due to legal fees regarding a complaint filed against the Company. See Part II. Other Information: - Item 1. Legal Proceedings for further discussion.

Interest Expense – The increase was due to the compounding effect of interest on our notes payable.

Liquidity and Capital Resources

As a development-stage company, we have no revenues and will be required to obtain an outside source of capital in order to execute our business plan and commercialize our products. Beginning in September 2008 and as of August 13, 2018, we raised an aggregate of: (i) approximately $3.4 million in separate offerings of units comprised of notes payable and warrants in separate offerings from 2008 through 2018 and (ii) $763,500 in an equity offering of restricted Common Stock through our Subscription Agreements (our Equity Offering 8/13). We are continuing to explore opportunities to raise cash through the issuance of these units and other financing opportunities, however to date we have not been successful in doing so. As of August 13, 2018, our current cash and other assets are not sufficient to fund our operations. As of June 30, 2018, we had a significant working capital deficit. Our liabilities are substantially greater than our current assets. Our only significant assets are our intellectual property rights, which are intangible and not readily convertible into liquid assets.

We are attempting to identify one or more potential sources of additional financing, such as through the sale of additional equity, various government funding opportunities and/or possibly through strategic alliances with larger energy or waste management companies. The Company will continue to explore and if identified, evaluate financing alternatives and/or other transactions, including potentially retaining a financial advisor. However, we may not be successful in securing additional financing. If we are not able to obtain additional financing in the immediate future, we will be required to further delay our development until such financing becomes available. Further, even assuming that we secure additional funds, we may never achieve profitability or positive cash flow. If we are not able to timely and successfully raise additional capital and/or achieve profitability or positive cash flow, we will not have sufficient capital resources to implement our business plan or to continue our operations.

Debt

Convertible Notes Payable - Since September 2008, the Company has conducted six offerings of units comprised of a convertible promissory note and a warrant, and one offering of a convertible note (with no warrant), having the terms set forth below:

Offering	Note Interest Rate			Note Conversion Price		Warrant Exercise Price		Term	Closed or Open
2008 Offering		6.0	%	$	0.25	$	0.45	One-year	Closed
2009 Offering		6.0	%	$	0.08	$	0.30	One-year	Closed
6/10 Offering		12.0	%	$	0.08	$	0.30	One-year	Closed
11/10 Offering		6.0	%	$	0.06	$	0.30	One-year	Closed
5/12 Offering		6.0	%	$	0.10	$	0.35	18 months	Closed
2/14 Offering		6.0	%	$	0.10		n/a	18 months	Closed
2015 Offering		6.0	%	$	0.10	$	0.15	18 months	Closed

Each note holder retains the option of cash repayment of the note plus interest or can convert the note at any time during the term of the note or prior to the closing of any Qualifying Equity Financing (minimum capital received of $5 million) into shares of Common Stock at the conversion price noted above. All notes have been recorded as debt (notes payable) in the consolidated financial statements, net of discounts for the conversion and warrant features (except for the 11/10, 5/12, 2/14, and 2015 Offerings which carried no discounts). The discounts have been amortized on a straight-line basis over the term of each note and were fully amortized as of December 31, 2011.

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2008 Offering - During September 2008, the Company commenced an offering of units and raised a total of $642,000 of investment proceeds through March 31, 2009. As of March 31, 2010, all of these notes had either been converted to shares of our common stock or exchanged into our 2009 Offering (resulting in new notes with a total face value of $539,829, which included the original principal and interest through the date of exchange).

2009 Offering - During April 2009, the Company commenced an offering of units and raised a total of $1,198,500 of investment proceeds through August 2010. Four notes have been converted to shares of Common Stock (one each in 2009, 2010, 2014 and 2017). Beginning in March 2011, certain notes were exchanged into our 11/10 Offering. As a result, as of June 30, 2018, we had $189,185 face value of notes outstanding, which includes the exchanged notes from our 2008 Offering. All of these notes have matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

6/10 Offering - During June 2010, the Company commenced an offering of units and raised a total of $75,000 of investment proceeds in one note. Upon maturity in June 2011, this note was exchanged into our 11/10 Offering. As a result, the balance due on this offering is $-0-.

11/10 Offering - During November 2010, the Company commenced an offering of units and raised a total of $451,713 of investment proceeds. Three notes were converted to shares of Common Stock during 2011 and four notes were converted to shares of Common Stock in 2012. As of June 30, 2018, we had $1,877,162 face value of notes outstanding, which includes exchanged notes from our 2009 Offering. As of June 30, 2018, all of the notes have matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

5/12 Offering - During May 2012, the Company commenced an offering of units and raised a total of $583,510 of investment proceeds. As of June 30, 2018, all of these notes were outstanding and matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

2/14 Offering - During February 2014, the Company commenced an offering of units and raised a total of $100,000 of investment proceeds in one note. As of June 30, 2018, this note is outstanding and has matured. We plan to work with the note holder to exchange, convert or repay this note.

2015 Offering - During September 2015, the Company commenced an offering of units and raised a total of $85,000 of investment proceeds in one note. As of June 30, 2018, this note is outstanding and matured. We plan to work with the note holder to exchange, convert or repay this note.

WL Meyer Legacy Trust (formerly CMS Acquisition, LLC) Note Payable -  In September 2010, the Company issued a note in the amount of $100,000 (interest at 6.0% per annum through May 15, 2011 and 10.0% thereafter and secured by a security interest in the PSC Patent) and issued warrants to purchase 2,000,000 shares of Common Stock at a price of $0.05 per share. Under the terms of an amendment to this note dated April 26, 2017, this note matured on April 26, 2018. The warrants are exercisable at any time for five years from the date of issuance or reissuance. The value of these warrants has been recorded as a contra-balance amount discount with the note and was fully amortized (interest expense) as of February 28, 2011 (the original due date). As consideration in the various amendments to this note, the Company has: (i) paid $30,000 towards accrued interest to date and principal on the note, (ii) increased the interest rate to 10% as of May 15, 2011, (iii) re-dated the original warrants to April 26, 2017, (iv) issued new warrants for 300,000 shares of Common Stock with an exercise price of $0.05 and exercisable at any time until April 26, 2022, (v) issued new warrants for 150,000 shares of Common Stock with an exercise price of $0.10 and exercisable at any time until April 26, 2022, and (vi) approved the assignment of the note by CMS Acquisition LLC to the WL Meyer Legacy Trust. As of June 30, 2018, $72,696 face value of this note is outstanding. We plan to work with the note holder to renew or repay the note.

June and October 2016 Note Payable – The Company issued two notes payable, with no conversion feature, to a current Board of Directors member, in the amounts of $50,000 and $35,000, respectively. In March of 2018, both notes were replaced with a convertible note payable with a face value of $97,599, and a 6% interest rate, due March 2019.

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January 2017 Note Payable – The Company issued a note payable, with no conversion feature, to William Meyer in the amount of $15,000, with a 6% interest rate, which was due March 20, 2017. We are currently working with the note holder to renew or repay the note.

October 2017 Note Payable – The Company issued a note payable, with no conversion feature, to a current Board of Directors member, in the amount of $25,000, with a 6% interest rate, due October 2018. As of June 30, 2018, the note was outstanding.

March 2018 Notes Payable – The Company issued two convertible notes payable to a current Board of Directors member in the amounts of $50,000 and $17,000, respectively, with a 6% interest rate, due March 2019. As of June 30, 2018, the notes were outstanding.

May 2018 Note Payable – The Company issued a convertible note payable to a current Board of Directors member in the amount of $30,000, with a 6% interest rate, due May 2019. As of June 30, 2018, the note was outstanding.

For more information, see Part II—Other Information: Item 4 – Default on Senior Securities.

The following is a summary of warrants issued and outstanding as of the dates below, at the exercise price and the number of shares of Common Stock (these warrants have not been exercised or converted to common shares):

	Exercise		June 30,		December 31,
Warrants issued to:	Price		2018		2017
Noteholders, 11/10 Offering		$0.30		-		398,221
Noteholder in 2015 Offering		$0.15		2,550,000		2,550,000
Investors in Subscription Agreements (a)		$0.15		6,300,000		9,300,000
WL Meyer Legacy Trust		$0.05		2,300,000		2,300,000
WL Meyer Legacy Trust		$0.10		150,000		150,000
				11,300,000		14,698,221

(a) Warrants issued to investors under these Subscription Agreements can be exercised anytime within three years from date of Agreement. These warrants currently expire at various dates from August 2018 to April 2022.

Summary of Cash Flow Activity

	Six months ended June 30,
	2018			2017
Net cash used by operating activities	$	(98,084	)	$	(80,317	)
Net cash provided by financing activities	$	97,000		$	110,000

Net cash used by operating activities

During the six months ended June 30, 2018 cash used by operating activities was impacted primarily by the loss incurred for the quarters less increases in stock grant expense and accrued liabilities. During the six months ended June 30, 2017 cash used by operating activities was impacted primarily by the loss incurred for the quarters less increases in accounts payable and other accrued liabilities.

Net cash provided by financing activities

Net cash provided by financing activities for the six months ended June 30, 2018 was due to the issuance of three convertible notes payable for $50,000, $17,000 and $30,000. Net cash provided by financing activities for the six months ended June 30, 2017 was primarily due to the issuance of a note payable for $15,000 and investments in our Equity Offering of $100,000, offset by note payable payments of $5,000.

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Contractual Obligations and Commitments

In the table below, we set forth our obligations as of June 30, 2018. Some of the figures we include in this table are based on our estimates and assumptions about these obligations, including their durations, anticipated actions by third parties and other factors. The obligations we may pay in future periods may vary from those reflected in this table because of estimates or actions of third parties as disclosed in the notes to the table.

	Payments due by Period
	Total		Less than 1 year		1 to 3 years		4 to 5 years		More than 5 years
Convertible Notes (1)	$	4,277,891	$	4,277,891	$	-	$	-	$	-
WL Meyer Legacy Trust (CMS) Note (2)		128,668		128,668		-		-		-
Note Payable (Non-convertible) (3)		16,300		16,300		-		-		-
Note Payable (Non-convertible) (4)		26,048		26,048		-		-		-
Total contractual obligations	$	4,448,907	$	4,448,907	$	-	$	-	$	-

(1) Amount represents value of principal amount of notes and estimates for interest. These notes are with various individuals, carry one-year terms and are convertible into shares of the Common Stock at the noteholders option. The first of these notes came due in April 2010. If the noteholders do not convert their notes into shares of Common Stock, the notes will have to be repaid or refinanced.

(2) Amount represents value of principal amount of note and interest. Final payment on this note was due April 26, 2018.

(3) Amount represents value of principal amount of note and interest. Final payment on this note was due March 20, 2017.

(4) Amount represents value of principal amount of note and interest. Final payment on this note is due October 18, 2018.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Critical Accounting Policies

We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. Certain accounting issues require management estimates and judgments for the preparation of financial statements. Our management periodically evaluates the estimates and judgments made. Management bases its estimates and judgments on historical experience and on various factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates as a result of different assumptions or conditions.

We believe that the estimates, assumptions and judgments relating to long-lived assets, convertible notes and warrants, fair-value measurement, share-based compensation and income tax matters have the greatest potential impact on our consolidated financial statements. Therefore, we consider these to be our critical accounting estimates. Our critical accounting policies and estimates are more fully described in our annual report on Form 10-K for the year ended December 31, 2017, filed with the Securities and Exchange Commission on April 2, 2018. Our critical accounting policies and estimate assumptions have not changed during the six months ended June 30, 2018.

Item 3. Quantitative and Qualitative Disclosures About Market Risk - Not applicable.

Item 4. Controls and Procedures

Effectiveness of Disclosure Controls and Procedures 

We maintain a set of disclosure controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified by the Security and Exchange Commission’s rules and regulations. Disclosure controls are also designed with the objective of ensuring that this information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

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Our management does not expect that our disclosure controls and procedures will necessarily prevent all fraud and material error. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving the objectives outlined above. Based on their most recent evaluation, which was performed based on the criteria set forth in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), our chief executive officer and interim chief financial officer concluded that our disclosure controls and procedures (as defined in Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934) are effective at that reasonable assurance level at June 30, 2018. Further, the design of a control system must reflect the fact that there are resource constraints, including, but not limited to having one full-time employee (chief executive officer), and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake.

Changes in Internal Control Over Financial Reporting 

During the six months ended June 30, 2018, there were no material changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings 

As previously discussed, on February 27, 2018, Gary Giordano, Thomas Giordano, and James Avenue, LLC, the minority members of Van Keuren (the “Plaintiffs”), filed a complaint (the “Complaint”) against the Company and Mr. Hennessey in the Chancery Division of the Superior Court of Hudson County, New Jersey arising out of the Acquisition Agreement with Van Keuren (the “Van Keuren Agreement”).  The Complaint asserted, among other things, that the Company failed to take reasonable actions to effectuate certain of its obligations under the Van Keuren Agreement within a reasonable time, such as (i) acquiring approval of the New Jersey Department of Environmental Protection to establish a transfer station and material recovery facility (“TS/MRF”) on property owned by James Avenue, LLC (the “James Avenue Property”), (ii) acquiring the other governmental approvals needed to operate the TS/MRF, and (iii) entering a lease with James Avenue, LLC to operate the TS/MRF, and also that the Company never delivered 1,000,000 shares of restricted common stock due to the plaintiffs as consideration under the Van Keuren Agreement.  Additionally, the Complaint included a brief requesting the Court to grant them injunctive relief.  See Item 1—Business—Plan of Operation—Biomass Feedstock Production for additional information regarding the Van Keuren Agreement.

On April 9, 2018, CleanTech filed, and on May 2, 2018 amended, an answer to the Complaint (the “Answer and Counterclaim”), both denying the allegations and asserting a counter claim against each of the Plaintiffs among other things, breach of contract, in particular the Van Keuren Agreement and related contracts; interference with a prospective economic advantage, specifically regarding operation of the TS/MRF; negligence with an economic advantage regarding the operation of the TS/MRF; common law fraud; unjust enrichment; claims under the New Jersey Racketeer Influenced and Corrupt Organizations Act; and that the Complaint asserted frivolous claims.

On April 20, 2018, a hearing was held in the Hudson County Superior Court of New Jersey Chancery Division where the Plaintiffs’ request for injunctive relief was denied.

Currently, the Company is negotiating a Settlement Agreement and Release with the Plaintiffs, Mr. Hennessey, and Van Keuren regarding the foregoing action (the “Settlement Agreement”).   At this time, the Company provides no assurance that the final Settlement Agreement will be approved by the plaintiffs, or that the lawsuit will be finally resolved.

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Item 1A. Risk Factors

In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in Part I, Item 1A in our Annual Report on Form 10-K for the year ended December 31, 2017, which could materially affect our business, financial condition or future results. These cautionary statements are to be used as a reference in connection with any forward-looking statements. The factors, risks and uncertainties identified in these cautionary statements are in addition to those contained in any other cautionary statements, written or oral, which may be made or otherwise addressed in connection with a forward-looking statement or contained in any of our subsequent filings with the Securities and Exchange Commission.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In April 2018, the Company issued 200,000 shares of restricted Common Stock to a consultant as compensation for accounting services provided to the Company. This offering of securities was exempt from registration under the Securities Act in accordance with Section 4(a)(2) thereof, as transactions by the issuer not involving a public offering.

In May 2018, the Company issued a convertible note in the principal amount of $30,000 to a current Board of Directors member. This convertible note bears simple interest of 6% and matures in May 2019. This convertible note may be converted into shares of the Company’s Common Stock at a price per share equal to $.04. The offering of this convertible note was exempt from registration under the Securities Act in accordance with Section 4(a)(2) thereof, as a transaction by the issuer not involving a public offering.

Item 3. Defaults Upon Senior Securities

Certain promissory notes in our offering of units comprised of convertible promissory notes and warrants, commenced in April 2009 (2009, 11/10, 5/12, 2/14 and 2015 Offerings) are due. As of June 30, 2018, approximately $4.4 million (including approximately $1.3 million of accrued interest) was due and payable. We plan to work with each remaining note holder to exchange, or convert, these promissory notes. There can be no assurance that we will reach agreements with any or all of these note holders and we may be required to repay such amounts.

Item 4. Mine Safety Disclosures – Not applicable

Item 5. Other Information - None

Item 6. Exhibits

INDEX TO EXHIBITS

EXHIBIT NO.	DESCRIPTION
31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended.
31.2	Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended.
32.1	Certification (Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002) of Chief Executive Officer.
32.2	Certification (Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002) of Principal Financial Officer.

30

SIGNATURES

Pursuant to the requirements 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.

	CLEANTECH BIOFUELS, INC.
Date: August 14, 2018	/s/ Edward P. Hennessey, Jr.
	Edward P. Hennessey, Jr.
	Chief Executive Officer
Date: August 14, 2018	/s/ Edward P. Hennessey, Jr.
	Edward P. Hennessey, Jr
	Interim Chief Financial Officer
	(Principal Accounting Officer)

31

EX-31.1

 Exhibit 31.1

CERTIFICATION

I, Edward P. Hennessey, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of CleanTech Biofuels, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

         a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

         b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

         c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

         d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

         a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

         b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Dated: August 14, 2018	/s/ Edward P. Hennessey, Jr.
	______________________
	Edward P. Hennessey, Jr.
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Edward P. Hennessey, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of CleanTech Biofuels, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

         a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

         b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

         c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

         d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

         a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

         b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Dated: August 14, 2018	/s/ Edward P. Hennessey, Jr.
	____________________
	Edward P. Hennessey, Jr.
	Interim Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT

TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of CleanTech Biofuels, Inc. (the "Company") on Form 10-Q for the period ended June 30, 2018, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Edward P. Hennessey, Jr., Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: August 14, 2018	/s/ Edward P. Hennessey, Jr.
	_______________________
	Edward P. Hennessey, Jr.
	Chief Executive Officer

This certification is made solely for purposes of 18 U.S.C. Section 1350 and not for any other purpose.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT

TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of CleanTech Biofuels, Inc. (the "Company") on Form 10-Q for the period ended June 30, 2018, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Edward P. Hennessey, Jr., Interim Chief Accounting Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: August 14, 2018	/s/ Edward P. Hennessey, Jr.
	_____________________
	Edward P. Hennessey, Jr.
	Interim Chief Financial Officer

This certification is made solely for purposes of 18 U.S.C. Section 1350 and not for any other purpose.

XML

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 13, 2018
Document Information [Line Items]
Entity Registrant Name	CleanTech Biofuels, Inc.
Entity Central Index Key	0001411036
Trading Symbol	clth
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Common Stock, Shares Outstanding (in shares)		99,083,409
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q2
Amendment Flag	false

XML

Consolidated Balance Sheets (Current Period Unaudited) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Current Assets:
Cash and cash equivalents	$ 1,421	$ 2,505
Prepaids and other current assets	59,918	64,718
	61,339	67,223
Property and equipment, net
Non-Current Assets:
Technology license	1,569,250	1,569,250
Patents	600,000	600,000
Intangibles	50,914	50,914
Goodwill	26,582	26,582
Total Assets	2,308,085	2,313,969
Current Liabilities:
Accounts payable	429,442	429,699
Accrued interest	1,306,755	1,194,149
Accrued payroll and professional fees	1,880,533	1,784,870
Notes payable, net	3,142,152	3,032,553
Total Current Liabilities	6,758,882	6,441,271
Notes Payable - Long-Term
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock, $0.001 par value; 10,000,000 authorized shares; no shares issued or outstanding
Common stock, $0.001 par value; 240,000,000 authorized shares; 99,083,409 and 97,633,409 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively	99,083	97,633
Minority Interest	505	505
Additional paid-in capital	7,558,007	7,536,257
Notes receivable - restricted common stock	(68,081)	(66,288)
Accumulated deficit	(12,040,311)	(11,695,409)
Total Stockholders' Equity (Deficit)	(4,450,797)	(4,127,302)
Total Liabilities and Stockholders' Equity (Deficit)	$ 2,308,085	$ 2,313,969

XML

Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	240,000,000	240,000,000
Common stock, shares issued (in shares)	99,083,409	97,633,409
Common stock, shares outstanding (in shares)	99,083,409	97,633,409

XML

Consolidated Statements of Operations (Unaudited) - USD ($)		3 Months Ended		6 Months Ended
		Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Costs and expenses:
General and administrative		$ 61,121	$ 61,529	$ 114,859	$ 118,504
Professional fees		41,115	27,107	106,631	69,930
		102,236	88,636	221,490	188,434
Other expense (income):
Interest expense		63,817	63,172	125,205	115,470
Interest income, net of accrued interest written-off		(908)	(1,245)	(1,793)	(2,481)
		62,909	61,927	123,412	112,989
Income tax benefit
Net loss		$ 165,145	$ 150,563	$ 344,902	$ 301,423
Basic and diluted net loss per common share (in dollars per share)	[1]
Weighted average common shares outstanding (in shares)		99,083,409	94,921,746	98,566,742	94,721,746

[1] less than $0.01

XML

Consolidated Statements of Changes in Stockholders' Equity (Deficit) (Unaudited) - 6 months ended Jun. 30, 2018 - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Noncontrolling Interest [Member]	Notes Rec-restricted Common Stock [Member]	Retained Earnings [Member]	Total
Balances (in shares) at Dec. 31, 2017	97,633,409
Balances at Dec. 31, 2017	$ 97,633	$ 7,536,257	$ 505	$ (66,288)	$ (11,695,409)	$ (4,127,302)
Issuance of restricted shares to consultants at $0.04/share (in shares)	1,450,000
Issuance of restricted shares to consultants at $0.04/share	$ 1,450	21,750
Interest on Notes Receivable				(1,793)
Net loss					(344,902)	(344,902)
Balances (in shares) at Jun. 30, 2018	99,083,409
Balances at Jun. 30, 2018	$ 99,083	$ 7,558,007	$ 505	$ (68,081)	$ (12,040,311)	$ (4,450,797)

XML

Consolidated Statements of Changes in Stockholders' Equity (Deficit) (Unaudited) (Parentheticals)	Jun. 30, 2018 $ / shares
Common Stock [Member]
Shares issued, price per share (in dollars per share)	$ 0.04

XML

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Operating Activities
Net loss applicable to common stockholders	$ (344,902)	$ (301,423)
Adjustments to reconcile net loss applicable to common stockholders to net cash used by operating activities:
Interest income, net of accrued interest written-off	(1,793)	(2,481)
Issuance of restricted common stock	23,200	3,200
Changes in operating assets and liabilities that provided (used) cash, net:
Prepaids and other current assets	4,800	7,701
Accounts payable	(257)	1,545
Other assets and other liabilities	125,205	115,451
Accrued liabilities	95,663	95,690
Net cash used by operating activities	(98,084)	(80,317)
Cash Flows Provided (Used) by Investing Activities
Expenditures for equipment
Net cash used by investing activities
Cash Flows Provided (Used) by Financing Activities
Issuance of Note Payable	97,000	15,000
Payments on Notes Payable		(5,000)
Sale of common stock		100,000
Net cash provided by financing activities	97,000	110,000
Net (decrease) increase in cash and cash equivalents	(1,084)	29,683
Cash and cash equivalents at beginning of period	2,505	636
Cash and cash equivalents at end of period	1,421	30,319
Supplemental disclosure of cash flow information:
Cash paid for interest
Supplemental disclosure of noncash investing and financing activities:
Common stock issued to consultant, directors, and/or employee	$ 23,200	$ 3,200

XML

Note 1 - Organization and Business

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block]

Note

1

– Organization

and

Business

Alternative Ethanol Technologies, Inc. (the “Company”), was incorporated in Delaware on

December 20, 1996.

Effective

August 2, 2007,

the Company changed its name to CleanTech Biofuels, Inc. Except where otherwise noted, the words “we,” “us,” “our,” and similar terms, as well as “CleanTech” or the “Company,” refer to CleanTech Biofuels, Inc. and its subsidiaries, collectively.

On

March 27, 2007,

the Company acquired SRS Energy, Inc., a Delaware corporation (“SRS Energy”), pursuant to an Agreement and Plan of Merger and Reorganization. In accordance with the merger agreement, SRS Acquisition Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company, merged with and into SRS Energy. The merger was consummated on

May 31, 2007

and resulted in SRS Energy becoming a wholly-owned subsidiary of the Company. As a result of the merger, the stockholders of SRS Energy surrendered all of their issued and outstanding common stock and received shares of the Company’s common stock,

$.001

par value per share (“Common Stock”). The former parent of SRS Energy, Supercritical Recovery Systems, Inc., immediately prior to the merger, distributed

78.8%

of its

96%

ownership in SRS Energy to its shareholders on a pro rata basis. For accounting purposes, because the Company had been a public shell company prior to the merger, the merger was treated as an acquisition of the Company and a recapitalization of SRS Energy.

The Company is in its development stage and has been engaged in technology development and pre-operational activities since its formation. The Company is currently seeking outside sources of funding that will provide the capital for us to design, build, and operate a commercial biomass recovery plant that will allow us to produce biomass feedstock for customer evaluation, trial purchases, and/or be used in equipment selection for power generation and possibly combined heat and power (“CHP”) production. Initially, the biomass feedstock output is expected to be sold or provided to electric utilities, power and steam producers, power and CHP equipment suppliers, and biofuel research firms for evaluation. In addition to seeking a source of funding for plant development, the Company hopes to license and/or develop potential commercial projects as they present themselves. Our development plan is to focus on cleaning and separating municipal solid waste (“MSW”) into its component parts in order to obtain: (i) a homogenous feedstock of cellulosic biomass for producing energy and other chemical products and (ii) recyclable products (metals, plastics, aluminum). Our plans

may

also include the possibility of operating a MSW transfer station where we could install our technology.

The Company has

no

operating history as a producer of biomass or energy sources and has

not

constructed any plants to date. We have

no

revenues and will be required to secure outside funding in order to execute our business plan and commercialize our products. Our current cash is

not

sufficient to fund our current operations. Our liabilities are substantially greater than our current available funds and current assets. Although we continue to seek additional financing through the sale of additional equity, various government funding opportunities and/or possibly through strategic alliances with larger energy or waste management companies, we have

not

had recent success securing meaningful amounts of financing. The Company will require substantial additional financing to implement its business plan and it

may

be unable to obtain the capital required to do so. If we are

not

able to immediately and successfully raise additional capital and/or achieve profitability or positive cash flow, we

may

not

be able to continue operations.

The accompanying unaudited, consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form

10

-Q and Articles 

8

and

10

of Regulation S-

X.

Accordingly, they do

not

include all of the information and notes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring items considered necessary for a fair presentation, have been included. Operating results for the

six

months ended

June 30, 2018

are

not

necessarily indicative of the results that

may

be expected for the year ended

December 31, 2018.

For further information, refer to the Company’s audited Consolidated financial statements and notes thereto included in our Annual Report on Form

10

-K for the year ended

December 31, 2017,

filed with the Securities and Exchange Commission (“SEC”) on

April 2, 2018.

XML

Note 2 - Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Basis of Presentation and Significant Accounting Policies [Text Block]

Note

2

–

Recent Accounting Pronouncements

In

June

of

2018,

the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

No.

2018

-

07

Compensation – Stock Compensation (Topic

718

). This ASU addresses share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic

718

to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic

718

applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic

718

does

not

apply to share-based payments used to effectively provide (

1

) financing to the issuer or (

2

) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic

606,

Revenue from Contracts with Customers. The amendments in this Update are effective for public business entities for fiscal years beginning after

December 15, 2018,

including interim periods within that fiscal year. For all other entities, the amendments are effective for fiscal years beginning after

December 15, 2019,

and interim periods within fiscal years beginning after

December 15, 2020.

Early adoption is permitted, but

no

earlier than an entity’s adoption date of Topic

606.

We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures.

In

July 2017,

the Financial Accounting Standards Board (“FASB”) issued ASU

No.

2017

-

11

Earnings Per Share (Topic

260

), Distinguishing Liabilities from Equity (Topic

480

), Derivatives and Hedging (Topic

815

). This ASU changes the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. As a result, a freestanding equity-linked financial instrument (or embedded conversion option)

no

longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (“EPS”) in accordance with Topic

260

to recognize the effect of the down round feature when it is triggered. The standard is effective for annual reporting periods beginning after

December 15, 2019,

and interim periods within fiscal years beginning after

December 15, 2020.

Early adoption is permitted, including adoption in any interim period. We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures.

In

May 2017,

the Financial Accounting Standards Board (“FASB”) issued ASU

No.

2017

-

09

Compensation – Stock Compensation (Topic

718

) Scope of Modification Accounting. This ASU, which amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC

718.

Specifically, an entity would

not

apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. The standard is effective for annual reporting periods, including interim periods within those annual reporting periods, beginning after

December 15, 2017.

Early adoption is permitted, including adoption in any interim period. The adoption of this guidance did

not

have a material impact on our consolidated financial statements and related disclosures.

In

January 2017,

the Financial Accounting Standards Board (“FASB”) issued ASU

No.

2017

-

04

Intangibles —Goodwill and Other (Topic

350

) “Simplifying the Test for Goodwill Impairment.” This ASU simplifies several aspects of the accounting for goodwill impairment. The guidance requires an entity to perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should

not

exceed the total amount of goodwill allocated to that reporting unit. The standard is effective for annual periods beginning after

December 15, 2019.

Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after

January 1, 2017.

We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures. 

In

February 2016,

the FASB issued ASU

No.

2016

-

02,

“Leases.” This ASU requires lessees to recognize most leases on their balance sheets for the rights and obligations created by those leases. The guidance requires enhanced disclosures regarding the amount, timing, and uncertainty of cash flows arising from leases and will be effective for interim and annual periods beginning after

December 15, 2018.

Early adoption is permitted. The ASU requires adoption based upon a modified retrospective approach. The adoption of this guidance is

not

expected to have a material impact on our consolidated financial statements and related disclosures.  

In

May 2014,

the FASB issued ASU

No.

2014

-

09,

“Revenue from Contracts with Customers.” This ASU will supersede most of the existing revenue recognition requirements in U.S. GAAP and will require entities to recognize revenue at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. The new standard also specifies new accounting for costs associated with obtaining or fulfilling contracts with customers and expands the required disclosures related to revenue and cash flows from contracts with customers. This new guidance is effective for annual reporting periods beginning after

December 15, 

2016,

including interim periods within that reporting period and can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption, with early application

not

permitted. In

August 2015,

the FASB approved a

one

-year deferral of the effective date of this ASU. This standard will now become effective beginning with the

first

quarter

2018

and can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption. We have adopted the guidance and currently it does

not

have a material impact on the financial statements as the Company does

not

have revenue. The requirements of the ASU will be followed when the Company does have revenue.

There were various other accounting standards updates recently issued, most of which represented technical corrections to the accounting literature or were applicable to specific industries and are

not

expected to have a material impact on the Company's financial position, results of operations or cash flows.

XML

Note 3 - Mergers Acquisitions

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Mergers, Acquisitions and Dispositions Disclosures [Text Block]

Note

3

–

Mergers

/

Acquisition

s

25

Van Keuren LLC

On

June 23, 2016,

the Company entered into an Acquisition Agreement with

25

Van Keuren LLC, a New Jersey Limited Liability Company (“Van Keuren”), pursuant to which the Company acquired

99%

of the outstanding membership interests in Van Keuren with the former members of Van Keuren retaining a

1%

interest.

The New Jersey Sports and Exposition Authority has received certification of an amendment to the Solid Waste Management Plan from the New Jersey Department of Environmental Protection (“DEP”) to include the proposed operation of a municipal solid waste transfer station and material recovery facility (“TS/MRF”) at a site located in Jersey City, New Jersey. CleanTech Biofuels and Van Keuren intend to seek the necessary permits and approvals from the New Jersey DEP to build, own and operate the TS/MRF. As part of the acquisition, CleanTech acquired an option to lease the property in Jersey City within

30

days after the final permit issues from the New Jersey DEP. The Company intends to: (

1

) install its Biomass Recovery Process on the site, and (

2

) operate the TS/MRF.

Van Keuren has had

no

operations or revenue since inception and has solely been working towards obtaining the permits required to operate the TS/MRF. As payment for the acquisition, the Company issued in the aggregate

1,000,000

shares of restricted common stock of the Company (par value

$0.001

) to certain holders of membership interests in Van Keuren. As of the close of business on

June 23, 2016,

the Company stock quote was

$0.05.

The total assets of Van Keuren at the time of the acquisition were

$51,000

(

2.3%

of the Company’s assets). The liabilities and equity consisted of accounts payable of

$27,000

and member equity of

$24,000.

The assets consist solely of costs incurred towards obtaining the required permits and have been recorded as an intangible asset on our consolidated financial statements. This intangible will be expensed if and when the Company and Van Keuren complete the permit process and begin operations.

Biomass North America Licensing, Inc.

On

September 15, 2008,

the Company consummated the acquisition of Biomass North America Licensing, Inc. (“Biomass”) pursuant to a merger between Biomass and a wholly-owned subsidiary of the Company (with Biomass as the surviving subsidiary of the Company) in accordance with an Agreement and Plan of Merger by and between the Company and Biomass. By virtue of the merger, the Company acquired a license agreement pursuant to which the Company holds a license in the United States and Canada to use patented technology licensed from Biomass North America, LLC, the former parent of Biomass (the “Licensor”), to clean and separate MSW (the “Biomass Recovery Process”). In

July 2010,

the United States Patent and Trademark Office issued US patent number

7,745,208

for this process (the “BRP Patent”).

Upon consummation of the merger, the Company paid

$20,000

in cash and issued a promissory note in the original principal amount of

$80,000

bearing interest at an annual rate of

6%

to a shareholder of the Licensor. This note has been paid in full. Additionally, the Company issued to the

four

shareholders of the Licensor a total of

1,895,000

shares of Common Stock and deposited an additional

4,000,000

shares of Common Stock into an escrow account (collectively, the “Shares”). The Shares were issued as part of the merger consideration received by the shareholders of the Licensor. In accordance with a

November 2013

amendment, the Company has an exclusive license in the United States and Canada to use the Biomass Recovery Process that includes

no

performance requirements on the Company; the license agreement is for a term of

21

years from the date of the amendment or the life of any patent issued for the Biomass Recovery Process, including any amendments, modifications or extensions; the license requires that the Company pay a royalty in the amount of

$2.00

per ton of MSW used in the Biomass Recovery Process to the Licensor; and the Company released the

4,000,000

shares of common stock to the Licensor previously held in escrow since the merger. The Company has recorded a long-term asset of approximately

$1.6

million which it will begin to amortize upon utilizing the license in our operations.

XML

Note 4 - Goodwill and Intangibles

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Goodwill and Intangible Assets Disclosure [Text Block]

Note

4

– Goodwill and Intangibles

Goodwill

The changes in Goodwill were as follows:

Balance at December 31, 2017	$	26,582
Additions		-
Balance at June 30, 2018	$	26,582

The Goodwill recorded was a result of the acquisition of Van Keuren in

June 2016

as disclosed previously in Note

3.

The amount of Goodwill represents the fair value paid for the acquisition (shares of Company common stock) in excess of the value of the net assets of Van Keuren.

Intangible Asset

The components of the Intangible Asset are as follows:

	June 30 , 2018						December 31, 2017
	Gross		Accumulated		Net Book		Gross		Accumulated		Net Book
	Amount		Amortization		Value		Amount		Amortization		Value
Van Keuren purchase	$	50,914	$	-	$	50,914	$	50,914	$	-	$	50,914

The Company’s goodwill and acquired intangible assets with indefinite lives are

not

amortized, but are subject to an annual impairment test. The Company performs an impairment analysis on its goodwill and intangible assets at least annually and whenever events or changes in circumstances indicate that the carrying value of such assets

may

not

be fully recoverable. Acquired intangible assets with definite lives are amortized over their estimated useful lives and are tested for impairment only when impairment indicators are present.

XML

Note 5 - Patent

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Patents and Intellectual Property [Text Block]

Note

5

– Patent

The Company owns US Patent

No.

6,306,248

(the “PSC Patent”), which is the underlying technology upon which the BRP Patent is based. The Company acquired the PSC Patent on

October 22, 2008

pursuant to a Patent Purchase Agreement (“Agreement”) with World Waste Technologies, Inc. (“WWT”). As part of the acquisition of the PSC Patent, we also became the licensor of such technology under the existing license agreement between Bio-Products International, Inc., the licensee (“Bio-Products”) and WWT. The Company has paid WWT

$600,000

and issued warrants to purchase

1,800,000

shares of Common Stock at

$0.10

per share and

500,000

shares of Common Stock at

$0.11

per share. WWT assigned all of its rights, title and interest in the note, warrants, security agreement and purchase agreement to Vertex Energy, Inc. (“Vertex”) as a result of a merger in

March 2009.

The warrants had an exercisable term of

five

years which expired on

October 22, 2014.

The cost of the PSC Patent acquisition of

$600,000

is recorded as a long-term asset on the Balance Sheet.

On

September 

1,

2010,

the Company issued a promissory note to CMS Acquisition, LLC (“CMS”) in the amount of

$100,000

and bearing interest at

6.0%

per annum. The note is secured with a security interest in the PSC Patent. In connection with the financing, the Company issued a warrant to CMS to purchase

2,000,000

shares of Common Stock at a price of

$0.05

per share. The warrant is exercisable at any time for

five

years from the date of issuance or re-issuance. The note was originally to mature on

February 28, 2011.

The Company and CMS have entered into various amendments extending the due date, the most recent of which was

April 26, 2017,

which extended the due date to

April 26, 2018.

As consideration in the various amendments to this note, the Company has: (i) paid

$30,000

towards accrued interest to date and principal on the note, (ii) increased the interest rate to

10%

as of

May 15, 2011, (

iii) re-dated the original warrants to

April 26, 2017, (

iv) issued new warrants for

300,000

shares of Common Stock with an exercise price of

$0.05

and exercisable at any time until

April 26, 2022, (

v) issued new warrants for

150,000

shares of Common Stock with an exercise price of

$0.10

and exercisable at any time until

April 26, 2022,

and (vi) approved the assignment of the note by CMS to the WL Meyer Legacy Trust. For more information on this note, see Item

2

– Management’s Discussion and Analysis of Financial Condition and Results of Operations – Debt.

XML

Note 6 - Technology Licenses

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Technology Licenses [Text Block]

Note

6

–

Technology Licenses

Biomass North America Licensing, Inc.

We own an exclusive license in the United States and Canada to use the Biomass Recovery Process (See Note

3

– Mergers/Acquisitions). We have recorded a long-term asset of approximately

$1.6

million for the value of this license. Amortization of this asset will begin upon commencement of the use of the Biomass Recovery Process.

In accordance with a

November 2013

amendment, the Company has an exclusive license in the United States and Canada to use the Biomass Recovery Process that includes

no

performance requirements on the Company; the license agreement is for a term of

21

years from the date of the amendment or the life of any patent issued for the Biomass Recovery Process, including any amendments, modifications or extensions; and the license requires that the Company pay a royalty in the amount of

$2.00

per ton of MSW used in the Biomass Recovery Process to the Licensor.

Bio-

Products International, Inc.

As disclosed in Note

5

- Patent, the Company acquired the PSC Patent in

2008

and as a result, became the licensor to Bio-Products for the PSC Patent pursuant to a Master License Agreement dated as of

August 18, 2003 (

the “PSC License Agreement”). Pursuant to the terms of the PSC License Agreement, Bio-Products (a wholly-owned subsidiary of Clean Earth Solutions, Inc., “CES”) is the exclusive licensee of the PSC Patent and has the right to sublicense the technology that is part of the PSC Patent (but

not

the BRP Patent) to any party. In addition, we are entitled to be paid

5%

of any revenue derived by Bio-Products from the use of the technology and

40%

of any sublicensing fees paid to Bio-Products for the use of the technology. The Master License Agreement is for a term of

20

years that commenced on

August 18, 2003.

On

September 22, 2010,

the Company sent a Notice of Breach to Bio-Products, which included removing the exclusivity of the license. We received a response from Bio-Products on

November 5, 2010

disputing our claims. In

February 2011,

we became aware that Bio-Products effected a transfer of the license in violation of the PSC License Agreement. As a result, on

March 21, 2011,

we sent a notice of termination to Bio-Products and the transferee terminating the License Agreement. In

June 2011,

Steve Vande Vegte, a shareholder in CES, filed a lawsuit against various parties, including the Company. The only Cause of Action against the Company is for Declaratory Relief seeking to avoid our

March 2011

termination of the license to which Mr. Vande Vegte is

not

a party. On

August 5, 2011,

the Company filed a demurrer requesting that the court dismiss the case on the grounds that Mr. Vande Vegte lacks standing to pursue a claim concerning the license and that the claim raised in the complaint is

not

ripe. The court granted our demurrer to dismiss CleanTech from this lawsuit on

December 8, 2011.

25

Van Keuren LLC

As discussed in Note

3

– Mergers/Acquisitions, the Company entered into an Acquisition Agreement with

25

Van Keuren LLC (“Van Keuren”). The total assets of Van Keuren at the time of the acquisition were approximately

$51,000.

The assets have been recorded as an intangible asset in our consolidated financial statements. This intangible will be expensed if and when the Company and Van Keuren complete the permit process and begin operations.

All intangible assets are reviewed for impairment whenever events or other changes in circumstances indicate that the carrying amount

may

not

be recoverable. An impairment charge is recognized if the carrying amount of an intangible asset exceeds its implied fair value.

XML

Note 7 - Debt

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Debt Disclosure [Text Block]

Note

7

–

Debt

	June 30, 2018			December 31, 2017
Convertible Notes Payable (2009 Offering), which are made up of various individual notes with an aggregate face value of $189,185 at June 30, 2018 and December 31, 2017, due one year from date of note, interest at 6.0%	$	189,185		$	189,185
Convertible Notes Payable (11/10 Offering), which are made up of various individual notes with an aggregate face value of $1,877,162 at June 30, 2018 and December 31, 2017, due one year from date of note, interest at 6.0%		1,877,162			1,877,162
WL Meyer Legacy Trust (formerly CMS Acquisition LLC) Note Payable, with a face value of $72,696 at June 30, 2018 and December 31, 2017, due on April 26, 2018, interest at 6.0% thru May 15, 2011; 10.0% thereafter		72,696			72,696
Convertible Notes Payable (5/12 Offering), made up of various individual notes with a face value of $583,510, due in 18 months from date of note, interest at 6.0%		583,510			583,510
Convertible Note Payable (2/14 Offering), which is made up of one note with a face value of $100,000 due in 18 months from date of note, interest at 6.0%		100,000			100,000
Convertible Note Payable (2015 Offering), which is made up of one note with a face value of $85,000 due in 18 months from date of note, interest at 6.0%		85,000			85,000
Note Payable, which is made up of one note with a face value of $50,000 due in six months from the date of note, interest at 9.0%		-			50,000
Note Payable, which is made up of one note with a face value of $35,000 due in six months from the date of note, interest at 9.0%		-			35,000
Note Payable, which is made up of one note with a face value of $15,000 due March 2017, interest at 6.0%		15,000			15,000
Note Payable, which is made up of one note with a face value of $25,000 due October 2018, interest at 6.0%		25,000			25,000
Convertible Note Payable, which is made up of one note with a face value of $97,599 due March 2019, interest at 6.0%		97,599			-
Convertible Note Payable, which is made up of one note with a face value of $50,000 due March 2019, interest at 6.0%		50,000			-
Convertible Note Payable, which is made up of one note with a face value of $17,000 due March 2019, interest at 6.0%		17,000			-
Convertible Note Payable, which is made up of one note with a face value of $30,000 due May 2019, interest at 6.0%		30,000			-
Total debt		3,142,152			3,032,553
Current maturities		(3,142,152	)		(3,032,553	)
Long-term debt	$	-		$	-

Convertible Notes

Payable

- Since

September 2008,

the Company has conducted

six

offerings of units comprised of a convertible promissory note and a warrant, and

one

offering of a convertible note (with

no

warrant), having the terms set forth below:

Offering	Note Interest Rate		Note Conversion Price		Warrant Exercise Price		Term	Closed or Open
2008 Offering		6.0%		$0.25		$0.45	One-year	Closed
2009 Offering		6.0%		$0.08		$0.30	One-year	Closed
6/10 Offering		12.0%		$0.08		$0.30	One-year	Closed
11/10 Offering		6.0%		$0.06		$0.30	One-year	Closed
5/12 Offering		6.0%		$0.10		$0.35	18 months	Closed
2/14 Offering		6.0%		$0.10		n/a	18 months	Closed
2015 Offering		6.0%		$0.10		$0.15	18 months	Closed

Each note holder retains the option of a cash repayment of the note plus interest, or the note can be converted at any time during the term of the note or prior to the closing of any Qualifying Equity Financing (minimum capital received of

$5

million), into shares of Common Stock at the conversion price noted above. All notes have been recorded as debt (notes payable) in the consolidated financial statements, net of discounts for the conversion and warrant features (except for the

11/10,

5/12,

2/14,

and

2015

Offerings which carried

no

discounts). See Note

12

- Subsequent Events for further disclosure regarding our notes.

2008

Offering

- During

September 2008,

the Company commenced an offering of units and raised a total of

$642,000

of investment proceeds through

March 31, 2009.

As of

March 31, 2010,

all of these notes had either been converted to shares of our common stock or exchanged into our

2009

Offering (resulting in new notes with a total face value of

$539,829,

which included the original principal and interest through the date of exchange).

2009

Offering

- During

April 2009,

the Company commenced an offering of units and raised a total of

$1,198,500

of investment proceeds through

August 2010.

Four notes have been converted to shares of Common Stock (

one

each in

2009,

2010,

2014

and

2017

). Beginning in

March 2011,

certain notes were exchanged into our

11/10

Offering. As a result, as of

June 30, 2018,

we had

$189,185

face value of notes outstanding, which includes the exchanged notes from our

2008

Offering. All of these notes have matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

6/10

Offering

- During

June 2010,

the Company commenced an offering of units and raised a total of

$75,000

of investment proceeds in

one

note. Upon maturity in

June 2011,

this note was exchanged into our

11/10

Offering. As a result, the balance due on this offering is $-

0

-.

11/10

Offering

- During

November 2010,

the Company commenced an offering of units and raised a total of

$451,713

of investment proceeds. Three notes were converted to shares of Common Stock during

2011

and

four

notes were converted to shares of Common Stock in

2012.

As of

June 30, 2018,

we had

$1,877,162

face value of notes outstanding, which includes exchanged notes from our

2009

Offering. As of

June 30, 2018,

all of the notes have matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

5/12

Offering

- During

May 2012,

the Company commenced an offering of units and raised a total of

$583,510

of investment proceeds. As of

June 30, 2018,

all of these notes were outstanding and matured. We plan to work with each remaining note holder to exchange, convert or repay these notes.

2/14

Offering

- During

February 2014,

the Company commenced an offering of units and raised a total of

$100,000

of investment proceeds in

one

note. As of

June 30, 2018,

this note is outstanding and has matured. We plan to work with the note holder to exchange, convert or repay this note.

2015

Offering

- During

September 2015,

the Company commenced an offering of units and raised a total of

$85,000

of investment proceeds in

one

note. As of

June 30, 2018,

this note is outstanding and matured. We plan to work with the note holder to exchange, convert or repay this note.

WL Meyer Legacy Trust (formerly CMS Acquisition, LLC) Note Payable

- In

September 2010,

the Company issued a note in the amount of

$100,000

(interest at

6.0%

per annum through

May 15, 2011

and

10.0%

thereafter and secured by a security interest in the PSC Patent) and issued warrants to purchase

2,000,000

shares of Common Stock at a price of

$0.05

per share. Under the terms of an amendment to this note dated April

26,

2017,

this note matured on April

26,

2018.

 The warrants are exercisable at any time for

five

years from the date of issuance or reissuance. The value of these warrants has been recorded as a contra-balance amount discount with the note and was fully amortized (interest expense) as of

February 28, 2011 (

the original due date). As consideration in the various amendments to this note, the Company has: (i) paid

$30,000

towards accrued interest to date and principal on the note, (ii) increased the interest rate to

10%

as of

May 15, 2011, (

iii) re-dated the original warrants to

April 26, 2017, (

iv) issued new warrants for

300,000

shares of Common Stock with an exercise price of

$0.05

and exercisable at any time until

April 26, 2022, (

v) issued new warrants for

150,000

shares of Common Stock with an exercise price of

$0.10

and exercisable at any time until

April 26, 2022,

and (vi) approved the assignment of the note by CMS Acquisition LLC to the WL Meyer Legacy Trust. As of

June 30, 2018,

$72,696

face value of this note is outstanding. We plan to work with the note holder to renew or repay the note.

7.1.15

Convertible Note Payable

- On

July 1, 2015,

one

noteholder in our

2009

Offering exchanged

two

notes into this note. This new note carries a

6%

annual interest, compounded annually, and is due in quarterly installment payments: the greater of

$3,000

or

10%

of all investment proceeds received during the calendar quarter preceding the quarterly installment payment. As of

June 20, 2018,

this note has been paid in full.

June

and

October

2016

Note Payable

–The Company issued

two

notes payable, with

no

conversion feature, to a current Board of Directors member, in the amounts of

$50,000

and

$35,000,

respectively. In

March

of

2018,

both notes were replaced with a convertible note payable with a face value of

$97,599,

and a

6%

interest rate, due

March 2019.

January 2017

Note Payable

– The Company issued a note payable, with

no

conversion feature, to William Meyer in the amount of

$15,000,

with a

6%

interest rate, which was due

March 20, 2017.

We are currently working with the note holder to renew or repay the note.

October 2017

Note Payable

– The Company issued a note payable, with

no

conversion feature, to a current Board of Directors member, in the amount of

$25,000,

with a

6%

interest rate, due

October 2018.

As of

June 30, 2018,

the note was outstanding.

March

201

8

Notes Payable

– The Company issued

two

convertible notes payable to a current Board of Directors member in the amounts of

$50,000

and

$17,000,

respectively, with a

6%

interest rate, due

March 2019.

As of

June 30, 2018,

the notes were outstanding.

May

2018

Note Payable

– The Company issued a convertible note payable to a current Board of Directors member in the amount of

$30,000,

with a

6%

interest rate, due

May 2019.

As of

June 30, 2018,

the note was outstanding.

The discounts on all notes payable have been amortized on a straight-line basis over the original term of each note. All discounts were fully amortized and expensed as of

June 30, 2018.

The following is a summary of warrants issued and outstanding as of the dates below, at the exercise price and the number of shares of Common Stock (these warrants have

not

been exercised or converted to shares of Common Stock).

	Exercise		June 30,		December 31,
Warrants issued to:	Price		2018		2017
Noteholders, 11/10 Offering		$0.30		-		398,221
Noteholder in 2015 Offering		$0.15		2,550,000		2,550,000
Investors in Subscription Agreements (a)		$0.15		6,300,000		9,300,000
WL Meyer Legacy Trust		$0.05		2,300,000		2,300,000
WL Meyer Legacy Trust		$0.10		150,000		150,000
				11,300,000		14,698,221

(a) Warrants issued to investors under these Subscription Agreements can be exercised anytime within three years from date of Agreement. These warrants currently expire at various dates from August 2018 to April 2022.

XML

Note 8 - Stockholders' Equity (Deficit)

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

Note

8

–

Stockholders'

Equity (

Deficit

)

In

August 2013,

the Company commenced an offering of units, under a Subscription Agreement, at a purchase price of

$1,000

per unit (Equity Offering

8/13

). Each unit consists of: (i)

10,000

shares of the Company’s authorized but unissued restricted Common Stock and (ii) warrants to purchase

30,000

additional shares of Common Stock for a

three

-year period from the date of issuance of the units at an initial exercise price of

$0.15

per share. As of

June 30, 2018,

the Company issued

7,635,000

restricted shares (at

$0.10

per share) of our Common Stock in exchange for

$763,500

in investment in this offering. See Note

12

- Subsequent Events for further updates to this offering and other share grants affecting Stockholders’ Equity.

In

February 2016,

the Board approved a grant to certain Board members and management for an aggregate of

4,000,000

shares of restricted Common Stock (at

$0.013

per share). The Board granted these awards in recognition of the efforts of the recipients towards the furtherance and implementation of the Company’s strategic plan and to induce the recipients to continue those efforts on behalf of the Company. Based on the foregoing, the Board determined such grants were in the best interest of the Company and its stockholders. 

In

June 2016,

the Company completed an acquisition of Van Keuren, as previously disclosed in Note

3,

and issued in the aggregate

1,000,000

shares of restricted Common Stock of the Company (at

$0.05

per share) to certain holders of membership interests in Van Keuren. 

In

August 2016,

a note receivable from a former director matured and was

not

paid. The note was originally issued in

August 2007

to purchase shares of our Common Stock. As a result,

150,000

shares of restricted Common Stock, issued at

$0.15

per share were forfeited and cancelled.

In

September 2016,

the Company issued

750,000

shares of restricted Common Stock to a consultant for business transactions and financing services to be provided over a

one

-year term.

In

May 2017,

the Company issued

100,000

shares of restricted Common Stock to a consultant for accounting services provided to the Company.

In

July 2017,

the Company issued

200,000

shares of restricted Common Stock to a consultant for accounting services provided to the Company.

In

August 2017,

the Company granted

3,000,000

shares of restricted Common Stock to consultants for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey markets to be provided over a

two

-year term. Of the

3,000,000

shares of restricted Common Stock granted,

2,000,000

were issued.

In

September 2017,

the Company issued

204,996

shares of Common Stock (

$0.08

per share) to an investor on conversion of a Convertible Note.

In

December 2017,

a note receivable from an employee matured and was

not

paid. The note was originally issued in

December 2008

to purchase shares of our Common Stock. As a result,

60,000

shares of restricted Common Stock, issued at

$0.36

per share were forfeited and cancelled.

For more information regarding these notes, see Part II—Other Information: Item

4

– Default on Senior Securities.

In

March 2018,

the Company issued

250,000

shares of restricted Common Stock to a consultant for legal / corporate finance services provided to the Company.

In

March 2018,

the Company issued the remaining

1,000,000

shares of restricted Common Stock granted in

August

of

2017,

to a consultant for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey markets.

In

April 2018,

the Company issued

200,000

shares of restricted Common Stock to a consultant for accounting services provided to the Company.

Net Loss per

s

hare

– The Company calculates basic loss per share (“EPS”) and diluted EPS. EPS is computed as net earnings (loss) divided by the weighted average number of common shares outstanding for the period. Diluted EPS would reflect the potential dilution that could occur from common shares issuable through stock options, warrants and other convertible securities. As of

June 30, 2018

and

December 31, 2017,

the Company had options, warrants and other convertible securities to purchase an aggregate of approximately

87

million and

85

million shares, respectively, of our Common Stock, that were excluded from the calculation of diluted loss per share as their effects would have been anti-dilutive. Therefore, the Company only presents basic loss per share on the statement of operations.

XML

Note 9 - Related Party Transactions

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Related Party Transactions Disclosure [Text Block]

Note

9

–

Related Party Transactions

The Company has entered into stock purchase agreements with its executive officers and certain members of the Board of Directors (“Board”). The executive officers and directors issued notes to the Company in exchange for their stock purchases. These notes and accumulated interest are recorded as notes receivable in Stockholders’ Deficit.

In

September 2013,

the Company hired, on a part-time basis, a Chief Technology Officer (“CTO”) and a VP-Business Development (“VP-BD”). These individuals maintain their engineering firm Fenton Engineering International (“FEI”) on a full-time basis and receive

no

salary in their part-time positions but are eligible for grants of stock options. We have used and continue to use their services. As of

June 30, 2018,

all amounts have been paid to FEI except for approximately

$48,000.

Two members of our current Board, James Russell and David Bransby, are parties in investments made in our convertible note offerings. As of

June 30, 2018

and

December 31, 2017,

their aggregate investment in our note offerings including interest, is approximately

$937,000

and

$760,000,

respectively.

Beginning in

2009,

the Company has provided advances to

two

employees – Ed Hennessey and Mike Kime. Mr. Kime resigned from his position with the Company effective

June 21, 2010.

As of

June 30, 2018

and

December 31, 2017,

the aggregate balance of Mr. Hennessey’s advances totaled approximately

$14,000

.

Mr. Kime’s advances were netted against monies due and paid to him in

2016

pursuant to a settlement agreement following his departure from the Company. The balance of Mr. Hennessey’s advances is included in Prepaids and Other Current Assets on the Balance Sheet.

In

June

and

October

of

2016,

the Company issued notes payable, with

no

conversion feature, to a current Board of Directors member, in the amounts of

$50,000

and

$35,000,

respectively. In

March

of

2018,

both notes were replaced with a convertible note payable with a face value of

$97,599,

and a

6%

interest rate, due

March 2019.

In

February

of

2017,

the Company received

$50,000

from a Board member in exchange for

500,000

shares of common stock.

In

June

of

2017,

the Company received

$50,000

from a Board member in exchange for

500,000

shares of common stock.

In

October

of

2017,

the Company issued a note payable with

no

conversion feature, to a current Board member in the amount of

$25,000,

with a

6%

interest rate, due

October 2018.

As of

June 30, 2018,

the note was outstanding.

In

March

of

2018,

the Company issued

two

convertible notes payable to a current Board member in the amounts of

$50,000

and

$17,000,

respectively, with a

6%

interest rate, due

March 2019.

As of

June 30, 2018,

the notes were outstanding.

In

May

of

2018,

theCompany issued a convertible note payable to a current Board of Directors member in the amount of

$30,000,

with a

6%

interest rate, due

May 2019.

As of

June 30, 2018,

the note was outstanding.

XML

Note 10 - Share-based Payments

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Note

10

– Share-based Payments

The Company recognizes share-based compensation expense for all share-based payment awards including stock options and restricted stock issued to employees, directors and consultants and is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period. The Company has

no

awards with market or performance conditions.

In

March 2007,

the Company assumed and adopted the

2007

Stock Option Plan (“Stock Plan”) for its employees, directors and consultants, which includes an equity compensation plan for non-employee directors pursuant to which stock options and shares of restricted stock

may

be granted.  The Company currently has reserved a maximum of

14,000,000

shares of common stock to be issued for stock options or restricted shares awarded under the Stock Plan.

In

September 2013,

the Company granted options under the Stock Plan to purchase an aggregate of

1,000,000

shares of Common Stock to

two

part-time employees (newly hired CTO and VP–BD) in which

one

-

third

will vest ratably beginning in

September 2014,

with an exercise price of

$0.10.

As of

June 30, 2018,

none

of these options were cancelled or expired and

1,000,000

shares of these options were vested.

In

February 2015,

the Company granted options under the Stock Plan to purchase an aggregate of

350,000

shares of Common Stock to a consultant, with an exercise price of

$0.10.

As of

June 30, 2018,

none

of these options were cancelled or expired and

350,000

shares of these options were vested.

In

February 2016,

the Board approved Common Stock grants to a member of management, and certain Board members, for

4.0

million shares, in the aggregate, of restricted Common Stock. Additionally, the Board approved the issuance of stock option agreements to a member of management and certain consultants for the purchase of

3.5

million shares, in the aggregate, of Common Stock. The Board granted these awards in recognition of the efforts of the recipients towards the furtherance and implementation of the Company’s strategic plan and to induce the recipients to continue those efforts on behalf of the Company. Based on the foregoing, the Board determined the grants were in the best interest of the Company and its stockholders. All of the share grant awards vest immediately and were issued pursuant to Regulation D promulgated under the Securities Act of

1933,

as amended (the “Securities Act”), or Section

4

(a)(

2

) of the Securities Act, and will therefore be “restricted securities” as such term is used in Rule

144

of the Securities Act. The option agreements were issued outside of the Company’s

2007

Stock Option Plan and carry the following terms:

seven

-year agreements, vesting in thirds ratably over

three

years, and are exercisable at the Company’s closing stock price as of the date of the grant. These options were calculated to have

no

value. Accordingly, there was

no

share-based compensation expense recorded in general and administrative expense.

In

February 2016,

the Company issued a stock option agreement to a consultant for the purchase of

100,000

shares of Common Stock. The option agreement was issued outside of the Company’s

2007

Stock Option Plan and carries the following terms:

seven

-year agreement, vesting in thirds ratably over

three

years, and are exercisable at the Company’s closing stock price as of the date of the grant. These options were calculated to have

no

value. Accordingly, there was

no

share-based compensation expense recorded in general and administrative expense.

In

May 2017,

the Company issued

100,000

shares of restricted Common Stock to a consultant for accounting services provided to the Company.

In

July 2017,

the Company issued

200,000

shares of restricted Common Stock to a consultant for accounting services provided to the Company.

In

August 2017,

the Company granted

3,000,000

shares of restricted Common Stock to consultants for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey markets to be provided over a

two

-year term. Of the

3,000,000

shares of restricted Common Stock granted,

2,000,000

were issued.

In

March 2018,

the Company issued

250,000

shares of restricted Common Stock to a consultant for legal / corporate finance services provided to the Company.

In

March 2018,

the Company issued the remaining

1,000,000

shares of restricted Common Stock granted in

August

of

2017,

to a consultant for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey markets.

In

April 2018,

the Company issued

200,000

shares of restricted Common Stock to a consultant for accounting services provided to the Company.

As of

June 30, 2018,

there was 

$42,800

in prepaids for compensation costs related to all share-based payment arrangements. There were

3,600,000

options granted with

2,400,000

shares vested as of

June 30, 2018

which have a weighted-average exercise price of

$0.13.

The remaining

1,200,000

options will vest in

February 2019.

Stock option expense is recognized in the statements of operations ratably over the vesting period based on the number of options that are expected to ultimately vest. Our options have characteristics significantly different from those of traded options and changes in the assumptions can materially affect the fair value estimates. The Company incurred

no

share-based compensation expense related to option grants for the

six

months ended

June 30, 2018

and

2017.

The following table summarizes the Company's stock option activity and related information under the Stock Plan:

	Shares Under Option			Weighted-Avg Exercise Price		Aggregate Intrinsic Value
Options outstanding as of December 31, 2017		8,345,000		$	0.10		(1)
Granted		-
Forfeited		(250,000	)
Options outstanding as of June 30, 2018		8,095,000			0.11		(1)
Options exercisable as of June 30, 2018		8,095,000			0.11

(

1

)  The weighted-average exercise price at

June 30, 2018

and

December 31, 2017

for all outstanding and exercisable options was greater than the fair value of the Company's common stock on that date, resulting in an aggregate intrinsic value of $-

0

-.

The following table summarizes information about the Company's issuances of restricted stock under the Stock Plan:

	Restricted shares issued		Weighted-Avg Issuance Price
Balance as of December 31, 2017		960,000		$0.10
Granted		-		$0.10
Forfeited		-		$0.10
Balance as of June 30, 2018		960,000		$0.10

In

February 2016,

the Company issued to members of management and a consultant

3,600,000

options outside of the Stock Plan. The options granted were in recognition of the efforts of the recipients towards the furtherance and implementation of the Company’s strategic plan and to induce the recipients to continue those efforts on behalf of the Company.

The Company has issued the following grants outside of the Stock Plan: (

1

) restricted Common Stock: (i) in

January 2015

for

500,000

shares to a member of management, (ii) in

January 2014

for

500,000

shares to a consultant to provide services regarding the collection, recycling, transfer, and disposal of MSW, (iii) in

April 2014,

to certain Board members and management for

4,250,000

shares in the aggregate, (iv) in

February 2016,

to certain Board members and a member of management for

4,000,000

shares in the aggregate, (v) in

May 2017

for

100,000

shares to a consultant for accounting services provided, (vi) in

July 2017

for

200,000

shares to a consultant for accounting services provided (vii) in

August 2017

for

3,000,000

shares to a consulting group for business consulting services regarding the collection and disposal of MSW in the New York and New Jersey and (viii) in

March 2018

for

250,000

shares to a consultant for legal services provided, (ix) in

April 2018

for

200,000

shares to a consultant for accounting services provided (

2

) in

February 2016,

the Board approved the issuance of stock option agreements to a member of management and certain consultants for the purchase of

3,600,000

shares, in the aggregate, of Common Stock. The shares and options issued to Board members and management were in recognition of the efforts of the recipients towards the furtherance and implementation of the Company’s strategic plan and to induce the recipients to continue those efforts on behalf of the Company. Total expense related to these grants for the

six

months ended

June 30, 2018

and

2017,

was

$7,200

and

$3,200,

respectively (included in our general and administrative expense for employees and professional fees for consultants).

All of the share grant awards vest immediately and were issued pursuant to Regulation D promulgated under the Securities Act, or Section

4

(a)(

2

) of the Securities Act, and will therefore be “restricted securities” as such term is used in Rule

144

of the Securities Act. The option agreements carry the following terms:

seven

-year agreements, vesting in thirds ratably over

three

years, and are exercisable at the Company’s closing stock price as of the date of the grant.

XML

Note 11 - Commitments and Contingencies

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

Note

1

1

– Commitments and Contingencies

Commitment

s

Lease

–

The Company leases approximately

1,800

square feet of office space for use as our corporate office, located at

7386

Pershing Ave. in St. Louis, Missouri. The original lease term expired in December

2016,

however, we are continuing to lease on a month-to-month basis.  Our monthly rent under the lease is

$1,800

plus the cost of utilities.

Contingencies

See Item

1.

Legal Proceedings in the Other Information section below.

XML

Note 12 - Subsequent Events

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Subsequent Events [Text Block]

Note

1

2

–

Subsequent Events

All of the promissory notes in our

2009,

5/12,

11/10,

2/14

and

2015

Offerings are now due. As of

August

13,

2018,

approximately

$4.0

million is currently due, including interest. We plan to work with each remaining note holder to exchange, convert or repay these promissory notes.

In

August

of

2018,

the Company issued a convertible note payable, to a current Board of Directors member, in the amount of

$20,000.

XML

Note 13 - Going Concern

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Substantial Doubt about Going Concern [Text Block]

Note

13

– Going Concern

During the

six

months ended

June 30, 2018,

the Company had a net loss of

$345,000,

negative cash flow from operations of

$98,000

and negative working capital of

$6.7

million. Additionally, the Company has significant debt currently due. Management has performed its evaluation of the entity’s ability to continue as a going concern and was

not

able to alleviate the substantial doubt about the Company’s ability to continue as a going concern within

one

year after

August

14,

2018,

the date these consolidated financial statements were available for issue.

XML

Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

New Accounting Pronouncements, Policy [Policy Text Block]

In

June

of

2018,

the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

No.

2018

-

07

Compensation – Stock Compensation (Topic

718

). This ASU addresses share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic

718

to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic

718

applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic

718

does

not

apply to share-based payments used to effectively provide (

1

) financing to the issuer or (

2

) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic

606,

Revenue from Contracts with Customers. The amendments in this Update are effective for public business entities for fiscal years beginning after

December 15, 2018,

including interim periods within that fiscal year. For all other entities, the amendments are effective for fiscal years beginning after

December 15, 2019,

and interim periods within fiscal years beginning after

December 15, 2020.

Early adoption is permitted, but

no

earlier than an entity’s adoption date of Topic

606.

We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures.

In

July 2017,

the Financial Accounting Standards Board (“FASB”) issued ASU

No.

2017

-

11

Earnings Per Share (Topic

260

), Distinguishing Liabilities from Equity (Topic

480

), Derivatives and Hedging (Topic

815

). This ASU changes the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. As a result, a freestanding equity-linked financial instrument (or embedded conversion option)

no

longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (“EPS”) in accordance with Topic

260

to recognize the effect of the down round feature when it is triggered. The standard is effective for annual reporting periods beginning after

December 15, 2019,

and interim periods within fiscal years beginning after

December 15, 2020.

Early adoption is permitted, including adoption in any interim period. We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures.

In

May 2017,

the Financial Accounting Standards Board (“FASB”) issued ASU

No.

2017

-

09

Compensation – Stock Compensation (Topic

718

) Scope of Modification Accounting. This ASU, which amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC

718.

Specifically, an entity would

not

apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. The standard is effective for annual reporting periods, including interim periods within those annual reporting periods, beginning after

December 15, 2017.

Early adoption is permitted, including adoption in any interim period. The adoption of this guidance did

not

have a material impact on our consolidated financial statements and related disclosures.

In

January 2017,

the Financial Accounting Standards Board (“FASB”) issued ASU

No.

2017

-

04

Intangibles —Goodwill and Other (Topic

350

) “Simplifying the Test for Goodwill Impairment.” This ASU simplifies several aspects of the accounting for goodwill impairment. The guidance requires an entity to perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should

not

exceed the total amount of goodwill allocated to that reporting unit. The standard is effective for annual periods beginning after

December 15, 2019.

Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after

January 1, 2017.

We are currently assessing the impact the guidance will have on our consolidated financial statements and related disclosures. 

In

February 2016,

the FASB issued ASU

No.

2016

-

02,

“Leases.” This ASU requires lessees to recognize most leases on their balance sheets for the rights and obligations created by those leases. The guidance requires enhanced disclosures regarding the amount, timing, and uncertainty of cash flows arising from leases and will be effective for interim and annual periods beginning after

December 15, 2018.

Early adoption is permitted. The ASU requires adoption based upon a modified retrospective approach. The adoption of this guidance is

not

expected to have a material impact on our consolidated financial statements and related disclosures.  

In

May 2014,

the FASB issued ASU

No.

2014

-

09,

“Revenue from Contracts with Customers.” This ASU will supersede most of the existing revenue recognition requirements in U.S. GAAP and will require entities to recognize revenue at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. The new standard also specifies new accounting for costs associated with obtaining or fulfilling contracts with customers and expands the required disclosures related to revenue and cash flows from contracts with customers. This new guidance is effective for annual reporting periods beginning after

December 15, 

2016,

including interim periods within that reporting period and can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption, with early application

not

permitted. In

August 2015,

the FASB approved a

one

-year deferral of the effective date of this ASU. This standard will now become effective beginning with the

first

quarter

2018

and can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption. We have adopted the guidance and currently it does

not

have a material impact on the financial statements as the Company does

not

have revenue. The requirements of the ASU will be followed when the Company does have revenue.

There were various other accounting standards updates recently issued, most of which represented technical corrections to the accounting literature or were applicable to specific industries and are

not

expected to have a material impact on the Company's financial position, results of operations or cash flows.

XML

Note 4 - Goodwill and Intangibles (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Schedule of Goodwill [Table Text Block]

Balance at December 31, 2017	$	26,582
Additions		-
Balance at June 30, 2018	$	26,582

Schedule of Intangible Assets and Goodwill [Table Text Block]

	June 30 , 2018						December 31, 2017
	Gross		Accumulated		Net Book		Gross		Accumulated		Net Book
	Amount		Amortization		Value		Amount		Amortization		Value
Van Keuren purchase	$	50,914	$	-	$	50,914	$	50,914	$	-	$	50,914

XML

Note 7 - Debt (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Schedule of Debt [Table Text Block]

	June 30, 2018			December 31, 2017
Convertible Notes Payable (2009 Offering), which are made up of various individual notes with an aggregate face value of $189,185 at June 30, 2018 and December 31, 2017, due one year from date of note, interest at 6.0%	$	189,185		$	189,185
Convertible Notes Payable (11/10 Offering), which are made up of various individual notes with an aggregate face value of $1,877,162 at June 30, 2018 and December 31, 2017, due one year from date of note, interest at 6.0%		1,877,162			1,877,162
WL Meyer Legacy Trust (formerly CMS Acquisition LLC) Note Payable, with a face value of $72,696 at June 30, 2018 and December 31, 2017, due on April 26, 2018, interest at 6.0% thru May 15, 2011; 10.0% thereafter		72,696			72,696
Convertible Notes Payable (5/12 Offering), made up of various individual notes with a face value of $583,510, due in 18 months from date of note, interest at 6.0%		583,510			583,510
Convertible Note Payable (2/14 Offering), which is made up of one note with a face value of $100,000 due in 18 months from date of note, interest at 6.0%		100,000			100,000
Convertible Note Payable (2015 Offering), which is made up of one note with a face value of $85,000 due in 18 months from date of note, interest at 6.0%		85,000			85,000
Note Payable, which is made up of one note with a face value of $50,000 due in six months from the date of note, interest at 9.0%		-			50,000
Note Payable, which is made up of one note with a face value of $35,000 due in six months from the date of note, interest at 9.0%		-			35,000
Note Payable, which is made up of one note with a face value of $15,000 due March 2017, interest at 6.0%		15,000			15,000
Note Payable, which is made up of one note with a face value of $25,000 due October 2018, interest at 6.0%		25,000			25,000
Convertible Note Payable, which is made up of one note with a face value of $97,599 due March 2019, interest at 6.0%		97,599			-
Convertible Note Payable, which is made up of one note with a face value of $50,000 due March 2019, interest at 6.0%		50,000			-
Convertible Note Payable, which is made up of one note with a face value of $17,000 due March 2019, interest at 6.0%		17,000			-
Convertible Note Payable, which is made up of one note with a face value of $30,000 due May 2019, interest at 6.0%		30,000			-
Total debt		3,142,152			3,032,553
Current maturities		(3,142,152	)		(3,032,553	)
Long-term debt	$	-		$	-

Convertible Debt [Table Text Block]

Offering	Note Interest Rate		Note Conversion Price		Warrant Exercise Price		Term	Closed or Open
2008 Offering		6.0%		$0.25		$0.45	One-year	Closed
2009 Offering		6.0%		$0.08		$0.30	One-year	Closed
6/10 Offering		12.0%		$0.08		$0.30	One-year	Closed
11/10 Offering		6.0%		$0.06		$0.30	One-year	Closed
5/12 Offering		6.0%		$0.10		$0.35	18 months	Closed
2/14 Offering		6.0%		$0.10		n/a	18 months	Closed
2015 Offering		6.0%		$0.10		$0.15	18 months	Closed

Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block]

	Exercise		June 30,		December 31,
Warrants issued to:	Price		2018		2017
Noteholders, 11/10 Offering		$0.30		-		398,221
Noteholder in 2015 Offering		$0.15		2,550,000		2,550,000
Investors in Subscription Agreements (a)		$0.15		6,300,000		9,300,000
WL Meyer Legacy Trust		$0.05		2,300,000		2,300,000
WL Meyer Legacy Trust		$0.10		150,000		150,000
				11,300,000		14,698,221

XML

Note 10 - Share-based Payments (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Share-based Compensation, Stock Options, Activity [Table Text Block]

	Shares Under Option			Weighted-Avg Exercise Price		Aggregate Intrinsic Value
Options outstanding as of December 31, 2017		8,345,000		$	0.10		(1)
Granted		-
Forfeited		(250,000	)
Options outstanding as of June 30, 2018		8,095,000			0.11		(1)
Options exercisable as of June 30, 2018		8,095,000			0.11

Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block]

	Restricted shares issued		Weighted-Avg Issuance Price
Balance as of December 31, 2017		960,000		$0.10
Granted		-		$0.10
Forfeited		-		$0.10
Balance as of June 30, 2018		960,000		$0.10

XML

Note 1 - Organization and Business (Details Textual) - USD ($) $ / shares in Units, $ in Thousands		6 Months Ended
	May 31, 2007	Jun. 30, 2018	Dec. 31, 2017	Jun. 23, 2016	May 30, 2007
Common Stock, Par or Stated Value Per Share	$ 0.001	$ 0.001	$ 0.001	$ 0.001
Revenues, Total		$ 0
Supercritical Recovery Systems Inc. [Member] | SRS Energy Inc. [Member]
Noncontrolling Interest, Ownership Distributed to Third Parties	78.80%
Noncontrolling Interest, Ownership Percentage by Parent					96.00%

XML

Note 3 - Mergers Acquisitions (Details Textual) - USD ($)			1 Months Ended
	Jun. 23, 2016	Sep. 15, 2008	Nov. 30, 2013	Jun. 30, 2018	Dec. 31, 2017	May 15, 2011	May 31, 2007
Common Stock, Par or Stated Value Per Share	$ 0.001			$ 0.001	$ 0.001		$ 0.001
Share Price	$ 0.05
Notes Payable, Total				$ 3,142,152	$ 3,032,553
Debt Instrument, Interest Rate, Stated Percentage						10.00%
Royalty Amount, Per Ton of MSW Used, Paid to Licensor			$ 2
25 Van Keuren LLC [Member]
Business Acquisition, Percentage of Voting Interests Acquired	99.00%
Business Acquisition Percentage of Voting Interests Retained by Former Members	1.00%
Business Acquisition, Revenue Reported by Acquired Entity for Last Annual Period	$ 0
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares	1,000,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets, Total	$ 51,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Percent of Company Assets	2.30%
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable	$ 27,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Member Equity	$ 24,000
Biomass North America Licensing Inc. [Member]
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares		1,895,000	4,000,000
Payments to Acquire Businesses, Gross		$ 20,000
Notes Payable, Total		$ 80,000
Debt Instrument, Interest Rate, Stated Percentage		6.00%
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life			21 years
Indefinite-lived Intangible Assets Acquired			$ 1,600,000

XML

Note 4 - Goodwill and Intangibles - Changes in Goodwill (Details)	6 Months Ended
	Jun. 30, 2018 USD ($)
Balance at December 31, 2017	$ 26,582
Additions
Balance at June 30, 2018	$ 26,582

XML

Note 4 - Goodwill and Intangibles - Intangible Assets (Details) - 25 Van Keuren LLC [Member] - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Gross Amount	$ 50,914	$ 50,914
Accumulated Amortization
Net Book Value	$ 50,914	$ 50,914

XML

Note 5 - Patent (Details Textual) - USD ($)			1 Months Ended	6 Months Ended		80 Months Ended
	Sep. 01, 2010	Oct. 22, 2008	Sep. 30, 2010	Jun. 30, 2018	Jun. 30, 2017	Apr. 26, 2017	May 15, 2011
Proceeds from Notes Payable, Total				$ 97,000	$ 15,000
Debt Instrument, Interest Rate, Stated Percentage							10.00%
CMS Acquisition LLC [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights	2,000,000		2,000,000
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 0.05		$ 0.05
Class of Right or Warrant, Exercisable Term	5 years		5 years
Proceeds from Notes Payable, Total	$ 100,000		$ 100,000
Debt Instrument, Interest Rate, Stated Percentage	6.00%						10.00%
Interest Expense, Debt, Total						$ 30,000
First New Issuance [Member] | CMS Acquisition LLC [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights						300,000
Class of Warrant or Right, Exercise Price of Warrants or Rights						$ 0.05
Second New Issuance [Member] | CMS Acquisition LLC [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights						150,000
Class of Warrant or Right, Exercise Price of Warrants or Rights						$ 0.10
PSC Patent [Member]
Payments to Acquire Intangible Assets		$ 600,000
Class of Right or Warrant, Exercisable Term		5 years
PSC Patent [Member] | First New Issuance [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights		1,800,000
Class of Warrant or Right, Exercise Price of Warrants or Rights		$ 0.10
PSC Patent [Member] | Second New Issuance [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights		500,000
Class of Warrant or Right, Exercise Price of Warrants or Rights		$ 0.11

XML

Note 6 - Technology Licenses (Details Textual) - USD ($)		1 Months Ended
	Aug. 18, 2003	Nov. 30, 2013	Jun. 30, 2018	Dec. 31, 2017	Jun. 23, 2016
Indefinite-Lived License Agreements			$ 1,569,250	$ 1,569,250
Royalty Amount, Per Ton of MSW Used, Paid to Licensor		$ 2
25 Van Keuren LLC [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets, Total					$ 51,000
Biomass Recovery Process [Member]
Indefinite-Lived License Agreements			$ 1,600,000
License Agreement, Term		21 years
Royalty Amount, Per Ton of MSW Used, Paid to Licensor		$ 2
PSC Patent [Member]
License Agreement, Term	20 years
License Agreement, Percent of Revenue	5.00%
License Agreement, Sublicensing Fees, Percent	40.00%

XML

Note 7 - Debt (Details Textual) - USD ($)				1 Months Ended											6 Months Ended		80 Months Ended
		Jul. 01, 2015	Sep. 01, 2010	Oct. 31, 2017	Oct. 31, 2016	Jun. 30, 2016	Sep. 30, 2015	Feb. 28, 2014	May 31, 2012	Nov. 30, 2010	Sep. 30, 2010	Aug. 31, 2010	Jun. 30, 2010	Sep. 30, 2008	Jun. 30, 2018	Jun. 30, 2017	Apr. 26, 2017	May 31, 2018	Mar. 31, 2018	Dec. 31, 2017	Jan. 31, 2017	May 15, 2011	Mar. 31, 2010
Minimum Capital Received Threshold, Conversion of Note															$ 5,000,000
Proceeds from Notes Payable, Total															97,000	$ 15,000
Notes Payable, Total															$ 3,142,152					$ 3,032,553
Debt Instrument, Interest Rate, Stated Percentage																						10.00%
Board of Directors Chairman [Member]
Debt Instrument, Interest Rate, Stated Percentage				6.00%
Proceeds from (Repayments of) Notes Payable, Total				$ 25,000
Current Board of Directors Member, James Russell [Member]
Proceeds from Notes Payable, Total					$ 35,000	$ 50,000
Notes Payable, Total																			$ 97,599
Debt Instrument, Interest Rate, Stated Percentage																			6.00%
William Meyer [Member]
Notes Payable, Total																					$ 15,000
Debt Instrument, Interest Rate, Stated Percentage																					6.00%
Subscription Agreements [Member]
Class of Warrant or Right, Exercise Price of Warrants or Rights	[1]														$ 0.15
Warrants and Rights Outstanding, Term															3 years
CMS Acquisition LLC [Member]
Proceeds from Notes Payable, Total			$ 100,000								$ 100,000
Notes Payable, Total															$ 72,696
Debt Instrument, Interest Rate, Stated Percentage			6.00%																			10.00%
Class of Warrant or Right, Number of Securities Called by Warrants or Rights			2,000,000								2,000,000
Class of Warrant or Right, Exercise Price of Warrants or Rights			$ 0.05								$ 0.05
Threshold of Aggregate Raised Amount for Repayment of Notes Payable																	$ 26
Class of Right or Warrant, Exercisable Term			5 years								5 years
Interest Expense, Debt, Total																	$ 30,000
CMS Acquisition LLC [Member] | First New Issuance [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights																	300,000
Class of Warrant or Right, Exercise Price of Warrants or Rights																	$ 0.05
CMS Acquisition LLC [Member] | Second New Issuance [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights																	150,000
Class of Warrant or Right, Exercise Price of Warrants or Rights																	$ 0.10
The 2008 Offering [Member]
Proceeds from Notes Payable, Total														$ 642,000
Notes Payable, Total																							$ 539,829
Debt Instrument, Interest Rate, Stated Percentage															6.00%
Class of Warrant or Right, Exercise Price of Warrants or Rights															$ 0.45
The 2009 Offering [Member]
Proceeds from Notes Payable, Total												$ 1,198,500
Notes Payable, Total															$ 189,185					$ 189,185
Debt Instrument, Interest Rate, Stated Percentage															6.00%					6.00%
Class of Warrant or Right, Exercise Price of Warrants or Rights															$ 0.30
Debt Instrument, Face Amount															$ 189,185					$ 189,185
The June 2010 Offering [Member]
Proceeds from Notes Payable, Total													$ 75,000
Notes Payable, Total																				0
Debt Instrument, Interest Rate, Stated Percentage															12.00%
Class of Warrant or Right, Exercise Price of Warrants or Rights															$ 0.30
The November 2010 Offering [Member]
Proceeds from Notes Payable, Total										$ 451,713
Notes Payable, Total										$ 1,877,162					$ 1,877,162					$ 1,877,162
Debt Instrument, Interest Rate, Stated Percentage															6.00%					6.00%
Class of Warrant or Right, Exercise Price of Warrants or Rights															$ 0.30
Debt Instrument, Face Amount															$ 1,877,162					$ 1,877,162
The May 2012 Offering [Member]
Proceeds from Notes Payable, Total									$ 583,510
Notes Payable, Total															$ 583,510					$ 583,510
Debt Instrument, Interest Rate, Stated Percentage															6.00%					6.00%
Class of Warrant or Right, Exercise Price of Warrants or Rights															$ 0.35
Debt Instrument, Face Amount															$ 583,510					$ 583,510
The February 2014 Offering [Member]
Proceeds from Notes Payable, Total								$ 100,000
Notes Payable, Total															$ 100,000					$ 100,000
Debt Instrument, Interest Rate, Stated Percentage															6.00%					6.00%
Class of Warrant or Right, Exercise Price of Warrants or Rights
Debt Instrument, Face Amount															$ 100,000					$ 100,000
The 2015 Offering [Member]
Proceeds from Notes Payable, Total							$ 85,000
Notes Payable, Total															$ 85,000					$ 85,000
Debt Instrument, Interest Rate, Stated Percentage															6.00%					6.00%
Class of Warrant or Right, Exercise Price of Warrants or Rights															$ 0.15
Debt Instrument, Face Amount															$ 85,000					$ 85,000
7.1.15 Convertible Note Payable [Member]
Debt Instrument, Interest Rate, Stated Percentage		6.00%
Debt Instrument, Periodic Payment, Total		$ 3,000
Debt Instrument, Period Payment, Percent of Investment Proceeds Received		10.00%
Convertible Note Payable, March 2018 [Member]
Debt Instrument, Interest Rate, Stated Percentage																			6.00%
Convertible Note Payable, March 2018 [Member] | Board of Directors 1 [Member]
Debt Instrument, Face Amount																			$ 50,000
Convertible Note Payable, March 2018 [Member] | Board of Directors 2 [Member]
Debt Instrument, Face Amount																			$ 17,000
Convertible Note Payable, May 2018 [Member] | Board of Directors, Current Member [Member]
Debt Instrument, Interest Rate, Stated Percentage																		6.00%
Debt Instrument, Face Amount																		$ 30,000

[1] Warrants issued to investors under these Subscription Agreements can be exercised anytime within three years from date of Agreement. These warrants currently expire at various dates from August 2018 to April 2022.

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Note 7 - Debt - Schedule of Debt (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017	Nov. 30, 2010
Total debt	$ 3,142,152	$ 3,032,553
Current maturities	(3,142,152)	(3,032,553)
Long-term debt
The 2009 Offering [Member]
Total debt	189,185	189,185
The November 2010 Offering [Member]
Total debt	1,877,162	1,877,162	$ 1,877,162
WL Meyer Legacy Trust (formerly CMS Acquisition LLC) [Member]
Total debt	72,696	72,696
The May 2012 Offering [Member]
Total debt	583,510	583,510
The February 2014 Offering [Member]
Total debt	100,000	100,000
The 2015 Offering [Member]
Total debt	85,000	85,000
The June 2016 Note Payable [Member]
Total debt		50,000
October 2016 Promissory Note Payable [Member]
Total debt		35,000
January 2017 Promissory Note Payable [Member]
Total debt	15,000	15,000
October 2018 Promissory Note Payable [Member]
Total debt	25,000	25,000
Convertible Note Payable, One [Member]
Total debt	97,599
Convertible Note Payable, Two [Member]
Total debt	50,000
Convertible Note Payable, Three [Member]
Total debt	17,000
Convertible Note Payable, Four [Member]
Total debt	$ 30,000

XML

Note 7 - Debt - Schedule of Debt (Details) (Parentheticals) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017	May 15, 2011
Interest rate			10.00%
The 2009 Offering [Member]
Interest rate	6.00%	6.00%
Face value	$ 189,185	$ 189,185
Debt instrument, term (Month)	1 year	1 year
The November 2010 Offering [Member]
Interest rate	6.00%	6.00%
Face value	$ 1,877,162	$ 1,877,162
Debt instrument, term (Month)	1 year	1 year
WL Meyer Legacy Trust (formerly CMS Acquisition LLC) [Member]
Face value	$ 72,696	$ 72,696
WL Meyer Legacy Trust (formerly CMS Acquisition LLC) [Member] | Minimum [Member]
Interest rate	6.00%	6.00%
WL Meyer Legacy Trust (formerly CMS Acquisition LLC) [Member] | Maximum [Member]
Interest rate	10.00%	10.00%
The May 2012 Offering [Member]
Interest rate	6.00%	6.00%
Face value	$ 583,510	$ 583,510
Debt instrument, term (Month)	1 year 180 days	1 year 180 days
The February 2014 Offering [Member]
Interest rate	6.00%	6.00%
Face value	$ 100,000	$ 100,000
Debt instrument, term (Month)	1 year 180 days	1 year 180 days
The 2015 Offering [Member]
Interest rate	6.00%	6.00%
Face value	$ 85,000	$ 85,000
Debt instrument, term (Month)	1 year 180 days	1 year 180 days
The June 2016 Note Payable [Member]
Interest rate		9.00%
Face value		$ 50,000
Debt instrument, term (Month)		180 days
October 2016 Promissory Note Payable [Member]
Interest rate		9.00%
Face value		$ 35,000
Debt instrument, term (Month)		180 days
January 2017 Promissory Note Payable [Member]
Interest rate	6.00%	6.00%
Face value	$ 15,000	$ 15,000
October 2018 Promissory Note Payable [Member]
Interest rate	6.00%	6.00%
Face value	$ 25,000	$ 25,000
Convertible Note Payable, One [Member]
Interest rate	6.00%
Face value	$ 97,599
Convertible Note Payable, Two [Member]
Interest rate	6.00%
Face value	$ 50,000
Convertible Note Payable, Three [Member]
Interest rate	6.00%
Face value	$ 17,000
Convertible Note Payable, Four [Member]
Interest rate	6.00%
Face value	$ 6

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Note 7 - Debt - Convertible Notes Payable (Details) - $ / shares	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017	May 15, 2011
Debt Instrument, Interest Rate, Stated Percentage			10.00%
The 2008 Offering [Member]
Debt Instrument, Interest Rate, Stated Percentage	6.00%
Note Conversion Price (in dollars per share)	$ 0.25
Warrant Exercise Price (in dollars per share)	$ 0.45
Term (Year)	1 year
The 2009 Offering [Member]
Debt Instrument, Interest Rate, Stated Percentage	6.00%	6.00%
Note Conversion Price (in dollars per share)	$ 0.08
Warrant Exercise Price (in dollars per share)	$ 0.30
Term (Year)	1 year	1 year
The June 2010 Offering [Member]
Debt Instrument, Interest Rate, Stated Percentage	12.00%
Note Conversion Price (in dollars per share)	$ 0.08
Warrant Exercise Price (in dollars per share)	$ 0.30
Term (Year)	1 year
The November 2010 Offering [Member]
Debt Instrument, Interest Rate, Stated Percentage	6.00%	6.00%
Note Conversion Price (in dollars per share)	$ 0.06
Warrant Exercise Price (in dollars per share)	$ 0.30
Term (Year)	1 year	1 year
The May 2012 Offering [Member]
Debt Instrument, Interest Rate, Stated Percentage	6.00%	6.00%
Note Conversion Price (in dollars per share)	$ 0.10
Warrant Exercise Price (in dollars per share)	$ 0.35
Term (Year)	1 year 180 days	1 year 180 days
The February 2014 Offering [Member]
Debt Instrument, Interest Rate, Stated Percentage	6.00%	6.00%
Note Conversion Price (in dollars per share)	$ 0.10
Warrant Exercise Price (in dollars per share)
Term (Year)	1 year 180 days	1 year 180 days
The 2015 Offering [Member]
Debt Instrument, Interest Rate, Stated Percentage	6.00%	6.00%
Note Conversion Price (in dollars per share)	$ 0.10
Warrant Exercise Price (in dollars per share)	$ 0.15
Term (Year)	1 year 180 days	1 year 180 days

XML

Note 7 - Debt - Warrants Outstanding (Details) - $ / shares		Jun. 30, 2018	Dec. 31, 2017
Warrants issued (in shares)		11,300,000	14,698,221
The November 2010 Offering [Member]
Warrant Exercise Price (in dollars per share)		$ 0.30
Warrants issued (in shares)			398,221
The 2015 Offering [Member]
Warrant Exercise Price (in dollars per share)		$ 0.15
Warrants issued (in shares)		2,550,000	2,550,000
Subscription Agreements [Member]
Warrant Exercise Price (in dollars per share)	[1]	$ 0.15
Warrants issued (in shares)	[1]	6,300,000	9,300,000
WL Meyer Legacy Trust [Member]
Warrant Exercise Price (in dollars per share)		$ 0.05
Warrants issued (in shares)		2,300,000	2,300,000
WL Meyer Legacy Trust, Second Exercise Price [Member]
Warrant Exercise Price (in dollars per share)		$ 0.10
Warrants issued (in shares)		150,000	150,000

[1] Warrants issued to investors under these Subscription Agreements can be exercised anytime within three years from date of Agreement. These warrants currently expire at various dates from August 2018 to April 2022.

XML

Note 8 - Stockholders' Equity (Deficit) (Details Textual) - USD ($)			1 Months Ended															6 Months Ended	12 Months Ended
	Jun. 23, 2016	Sep. 15, 2008	Apr. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Aug. 31, 2017	Jul. 31, 2017	May 31, 2017	Sep. 30, 2016	Aug. 31, 2016	Feb. 29, 2016	Apr. 30, 2014	Jan. 31, 2014	Nov. 30, 2013	Aug. 31, 2013	Dec. 31, 2008	Jun. 30, 2018	Dec. 31, 2017
Share Price	$ 0.05
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount																		87,000,000	85,000,000
Conversion of Convertible Note to Common Stock [Member]
Shares Issued, Price Per Share						$ 0.08
Stock Issued During Period, Shares, Conversion of Convertible Securities						204,996
Former Director [Member]
Expiration of Notes Receivables, Shares											150,000
Expiration of Note Receivable, Price Per Share											$ 0.15
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period					60,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value																	$ 0.36	$ 0.10
Board Members and Management [Member] | Restricted Stock [Member]
Shares Issued, Price Per Share												$ 0.013
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period												4,000,000	4,250,000
Consultant [Member]
Stock Issued During Period, Shares, Issued for Services			200,000	250,000			2,000,000	200,000	100,000	750,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period							3,000,000
Consultant [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period														500,000
Consultant for Services Regarding Collection and Disposal of MSW [Member]
Stock Issued During Period, Shares, Issued for Services				1,000,000
Biomass North America Licensing Inc. [Member]
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares		1,895,000													4,000,000
25 Van Keuren LLC [Member]
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares	1,000,000
Shares Issued, Price Per Share	$ 0.05
Stock Issued During Period, Shares, Acquisitions	1,000,000
Offering of Units [Member]
Offering of Units, Price Per Unit																$ 1,000
Offering of Units, Number of Restricted Common Stock																10,000
Offering of Units, Number of Shares Called by Warrants or Rights																30,000
Offering of Units, Class of Warrant or Right, Exercisable Period																3 years
Offering of Units, Class of Warrant or Right, Exercise Price																$ 0.15
Stock Issued During Period, Shares, New Issues																			7,635,000
Share Price					$ 0.10														$ 0.10
Stock Issued During Period, Value, New Issues																			$ 763,500

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Note 9 - Related Party Transactions (Details Textual) - USD ($)	1 Months Ended					6 Months Ended
	Oct. 31, 2017	Jun. 30, 2017	Feb. 28, 2017	Oct. 31, 2016	Jun. 30, 2016	Jun. 30, 2018	Jun. 30, 2017	May 31, 2018	Mar. 31, 2018	Dec. 31, 2017	May 15, 2011
Due to Other Related Parties						$ 937,000				$ 760,000
Due from Employees						14,000				$ 14,000
Proceeds from Notes Payable, Total						97,000	$ 15,000
Debt Instrument, Interest Rate, Stated Percentage											10.00%
Proceeds from Issuance of Common Stock							$ 100,000
Convertible Note Payable, March 2018 [Member]
Debt Instrument, Interest Rate, Stated Percentage									6.00%
FEI [Member]
Due to Related Parties, Total						$ 48,000
Current Board of Directors Member, James Russell [Member]
Proceeds from Notes Payable, Total				$ 35,000	$ 50,000
Debt Instrument, Interest Rate, Stated Percentage									6.00%
Current Board of Directors Member, James Russell [Member] | Replacement Convertible Note Payable [Member]
Debt Instrument, Face Amount									$ 97,599
Debt Instrument, Interest Rate, Stated Percentage									6.00%
Board Member [Member]
Proceeds from Issuance of Common Stock		$ 50,000	$ 50,000
Board Member [Member] | Common Stock [Member]
Stock Issued During Period, Shares, New Issues		500,000	500,000
Board of Directors Chairman [Member]
Debt Instrument, Interest Rate, Stated Percentage	6.00%
Proceeds from (Repayments of) Notes Payable, Total	$ 25,000
Board of Directors Chairman [Member] | Convertible Note Payable, March 2018 [Member]
Debt Instrument, Interest Rate, Stated Percentage									6.00%
Board of Directors 1 [Member] | Convertible Note Payable, March 2018 [Member]
Debt Instrument, Face Amount									$ 50,000
Board of Directors 2 [Member] | Convertible Note Payable, March 2018 [Member]
Debt Instrument, Face Amount									$ 17,000
Board of Directors, Current Member [Member] | Convertible Note Payable, May 2018 [Member]
Debt Instrument, Face Amount								$ 30,000
Debt Instrument, Interest Rate, Stated Percentage								6.00%

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Note 10 - Share-based Payments (Details Textual) - USD ($)	1 Months Ended													6 Months Ended
	Feb. 28, 2019	Apr. 30, 2018	Mar. 31, 2018	Aug. 31, 2017	Jul. 31, 2017	May 31, 2017	Sep. 30, 2016	Feb. 29, 2016	Feb. 28, 2015	Jan. 31, 2015	Apr. 30, 2014	Jan. 31, 2014	Sep. 30, 2013	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares														2,400,000
Allocated Share-based Compensation Expense, Total														$ 42,800
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares, Ending Balance														3,600,000
Share-based Compensation Arrangement by Share-based Payment Award, Option, Nonvested, Weighted Average Exercise Price, Ending Balance														$ 0.13
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value														$ 0		$ 0
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
Employee Stock Option [Member]
Allocated Share-based Compensation Expense, Total														$ 0	$ 0
Employee Stock Option [Member] | Subsequent Event [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares	1,200,000
Employee Stock Option [Member] | General and Administrative Expense [Member]
Allocated Share-based Compensation Expense, Total														$ 7,200	$ 3,200
Management and Consultants [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross								3,600,000
Management and Consultants [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period								4,000,000
Management and Consultants [Member] | Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross								3,500,000
Share-based Compensation Arrangement by Share-based Payment Award, Agreement Term								7 years
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period								3 years
Management and Consultants [Member] | Employee Stock Option [Member] | General and Administrative Expense [Member]
Allocated Share-based Compensation Expense, Total								$ 0
Consultant [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period				3,000,000
Stock Issued During Period, Shares, Issued for Services		200,000	250,000	2,000,000	200,000	100,000	750,000
Stock Granted for Services, Shares, Gross				3,000,000
Consultant [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period												500,000
Consultant [Member] | Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross								100,000
Share-based Compensation Arrangement by Share-based Payment Award, Agreement Term								7 years						7 years
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period								3 years						3 years
Consultant [Member] | Employee Stock Option [Member] | General and Administrative Expense [Member]
Allocated Share-based Compensation Expense, Total								$ 0
Consultant for Services Regarding Collection and Disposal of MSW [Member]
Stock Issued During Period, Shares, Issued for Services			1,000,000
Management [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period										500,000
Board Members and Management [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross								3,600,000
Board Members and Management [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period								4,000,000			4,250,000
2007 Stock Option Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized														14,000,000
2007 Stock Option Plan [Member] | Stock Options, Granted in February 2015 [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross									350,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price									$ 0.10
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Total														0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares														350,000
2007 Stock Option Plan [Member] | Part-time Employees [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross													1,000,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price													$ 0.10
2007 Stock Option Plan [Member] | Part-time Employees [Member] | Stock Options, Granted in September 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Total														0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares														1,000,000

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Note 10 - Share-based Payments - Stock Options Activity (Details) - USD ($)		6 Months Ended
		Jun. 30, 2018	Dec. 31, 2017
Options outstanding (in shares)		8,345,000
Options outstanding, weighted average exercise price (in dollars per share)		$ 0.10
Options outstanding, aggregate intrinsic value	[1]
Granted (in shares)
Granted, weighted average exercise price (in dollars per share)
Forfeited (in shares)		(250,000)
Forfeited, weighted average exercise price (in dollars per share)
Options outstanding (in shares)		8,095,000
Options outstanding, weighted average exercise price (in dollars per share)		$ 0.11
Options exercisable as of June 30, 2018 (in shares)		8,095,000
Options exercisable as of June 30, 2018 (in dollars per share)		$ 0.11

[1] The weighted-average exercise price at June 30, 2018 and December 31, 2017 for all outstanding and exercisable options was greater than the fair value of the Company's common stock on that date, resulting in an aggregate intrinsic value of $-0-.

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Note 10 - Share-based Payments - Restricted Stock (Details) - Restricted Stock [Member] - $ / shares	1 Months Ended		6 Months Ended
	Dec. 31, 2017	Dec. 31, 2008	Jun. 30, 2018
Shares outstanding (in shares)			960,000
Shares outstanding, weighted average exercise price (in dollars per share)			$ 0.10
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 0.36	$ 0.10
Forfeited (in shares)	(60,000)
Forfeited, weighted average exercise price (in dollars per share)			$ 0.10
Shares outstanding (in shares)	960,000		960,000
Shares outstanding, weighted average exercise price (in dollars per share)	$ 0.10		$ 0.10

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Note 11 - Commitments and Contingencies (Details Textual) - Corporate Office Lease Arrangement [Member]	6 Months Ended
	Jun. 30, 2018 USD ($) ft²
Area of Real Estate Property | ft²	1,800
Operating Leases, Rent Expense, Minimum Rentals | $	$ 1,800

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Note 12 - Subsequent Events (Details Textual) - USD ($)	Aug. 13, 2018	Jun. 30, 2018	Dec. 31, 2017
Notes Payable, Total		$ 3,142,152	$ 3,032,553
Convertible Promissory Note [Member] | Subsequent Event [Member]
Notes Payable, Total	$ 4,000,000
Convertible Note Payable, August 2018 [Member] | Subsequent Event [Member] | Board of Directors, Current Member [Member]
Debt Instrument, Face Amount	$ 20,000

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Note 13 - Going Concern (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Net Income (Loss) Attributable to Parent, Total	$ (165,145)	$ (150,563)	$ (344,902)	$ (301,423)
Net Cash Provided by (Used in) Operating Activities, Total			(98,084)	$ (80,317)
Working Capital	$ (6,700,000)		$ (6,700,000)