CCTC Clean Coal Technologies Inc (PK)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

FORM 10-Q

(Mark One)

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

For the quarterly period ended: September 30, 2023

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

For the transition period from                                          to                                       .

Commission file number: 000-50053

NEWSTREAM ENERGY TECHNOLOGIES GROUP, INC.

(Exact name of small business issuer as specified in its charter)

(CLEAN COAL TECHNOLOGIES, INC.)

(Former Name if Changed since Last Report)

(646) 727-4847

(Issuer’s telephone number)

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

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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 ☒ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected to not use the extended transition period for complying with any new or revisited 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 ☒

The number of shares outstanding of Registrant’s Common Stock as of date: November 20, 2023: 366,388,685 

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission and, therefore, do not include all information and footnotes necessary for a complete presentation of our financial position, results of operations, cash flows, and stockholders’ deficit in conformity with generally accepted accounting principles. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature.

NewStream Energy Technologies Group, Inc.

(Formerly Clean Coal Technologies, Inc.)

Balance Sheets

(Unaudited)

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

NewStream Energy Technologies Group, Inc.

(Formerly Clean Coal Technologies, Inc.)

Statements of Operations

(Unaudited)

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

NewStream Energy Technologies Group, Inc.

(Formerly Clean Coal Technologies, Inc.)

Unaudited Statements of Changes in Stockholders’ Deficit

For the Three and Nine months Ended September 30, 2023 and 2022

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

NewStream Energy Technologies Group, Inc.

(Formerly Clean Coal Technologies, Inc.)

Statements of Cash Flows

(Unaudited)

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

NewStream Energy Technologies Group, Inc.

(Formerly Clean Coal Technologies, Inc.)

Notes to Financial Statements

(Unaudited)

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

FORWARD-LOOKING STATEMENTS AND FACTORS THAT MAY AFFECT FUTURE RESULTS

This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they do not materialize or prove correct, could cause our results to differ materially from those expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including, but not limited to, statements concerning: our plans, strategies and objectives for future operations; new products or developments; future economic conditions, performance or outlook; the outcome of contingencies; expected cash flows or capital expenditures; our beliefs or expectations; activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future; and assumptions underlying any of the foregoing. Forward-looking statements may be identified by their use of forward-looking terminology, such as “believes,” “expects,” “may,” “should,” “would,” “will,” “intends,” “plans,” “estimates,” “anticipates,” “projects” and similar words or expressions. You should not place undue reliance on these forward-looking statements, which reflect our management’s opinions only as of the date of the filing of this Quarterly Report on Form 10-Q and are not guarantees of future performance or actual results

Overview

On June 01 2023, Clean Coal Technologies, Inc.changed its name to NewStream Energy Technologies Group, Inc. (“NewStream”, or the “Company”). Over the past decade, NewStream has developed processes that address what we believe are the key technology priorities of the global coal industry. We currently have three processes in our intellectual property portfolio:

The original process, called Pristine, is designed to remove moisture and volatile matter, rendering a high-efficiency, cleaner thermal coal. The process has been tested successfully on bituminous and subbituminous coals, and lignite from various parts of the United States and from numerous countries around the world.

Our second process, called Pristine-M, is a low-cost coal dehydration technology. In tests, this process has succeeded in drying coal economically and stabilizing it using volatile matter released by the feed coal. Construction of our coal testing plant was completed in December 2015 and was successfully tested through April 2016 at AES Coal Power Utility in Oklahoma. Additional tests commenced and were completed in the fourth quarter of 2017. This test facility has been moved from AES to Wyoming where reassembly has commenced and testing of international coal is expected upon completion of the reassembly. Changes identified to the process by the University of Wyoming and our EPC contractors will be included in the reassembly and it is expected to provide a higher quality end product with a lower capital cost for a commercial unit. The reassembly was delayed due to the pandemic but is expected to be completed in Q3 2023.

Our third process, called Pristine-SA, is designed to eliminate 100% of the volatile matter in the feed coal and to achieve stable combustion by co-firing it with biomass or natural gas. The process is expected to produce a cleaner fuel that eliminates the need for emissions scrubbers and the corollary production of toxic coal ash. We anticipate that treated coal that is co-fired with other energy resources will burn as clean as natural gas.

Anticipated Benefits of the Technology:

Successful testing of the Pristine M process resulted in an increase in BTU of the processed coal and a reduction in moisture content making it less expensive to transport (as moisture has been removed) with the end product being a dust free stabilized enhanced coal which we believe will address the issue of coal dust pollution during transportation.

Development Status:

Pristine process. Pristine process successfully lab tested on small scale and through advanced computer modeling. As at November, 2020, various aspects of the Pristine process were successfully tested at our test facility at the AES coal Power plant in Oklahoma as part of the overall testing of Pristine M. The second-generation facility in Wyoming is expected to perform a more detailed testing of the Pristine process. The build out and delivery of the Rotary Kiln will enable the test facility to reach significantly higher temperatures to test with more accuracy the Pristine process.

Pristine-M. Testing of the Pristine M process on Powder River Basin coal at the AES facility in Oklahoma was completed in December 2017. The Pristine M process was successfully tested and the process, engineering and science were independently proven. The test facility was moved from the AES location to Wyoming where reassembly commenced in Q4 2019 and testing of international coal is expected upon completion of reassembly. The reassembly was delayed due to the pandemic and is expected to be completed in Q4 2023. Over several months in 2018 and early 2019 the University of Wyoming independently validated the Pristine M process in their laboratory. By coating the exterior of the coal during the stabilization period with heavy hydrocarbons the process produces dust free stabilized coal for transportation.

Pristine-SA process. Pristine SA process analysis is at a very early stage. Further research and development is expected using the test facility at its permanent location in Wyoming. The introduction of the Rotary Kiln and the higher temperatures it can achieve will enable a more accurate testing protocol for this process.

On October 24, 2023, the Company completed its merger of NewStream Acquisition Partners 2. This merger which was previously reported as an 8K event in May 2023 and required the company to issue a total of 275,000,000 common shares which it did on September 19, 2023. The completion of the merger has resulted in a number of additional technologies being added to the Company’s technology platform.

Business Outlook

Employees

As of September 30, 2023, we had two full-time executives. President and CEO Robin Eves, Chief Operations Officer and Aiden Neary, Chief Financial Officer have written employment agreements. Messrs. Eves and Neary received no compensation for their participation on the Board of Directors.

Factors Affecting Results of Operations

Our operating expenses include the following:

Results of Operations

We had no direct revenues for the nine months ended September 30, 2023 or September 30, 2022. In 2017, we received $100,000 as a non-refundable deposit on a two million ton license agreement from Wyoming New Power, a related party. The definitive license agreement is expected to be completed in 2024 following the assembly of the second generation test facility. In the year ended December 31, 2012, we received an initial license fee of $375,000 from Jindal paid pursuant to the signing of our coal testing plant construction contract. The balance of $375,000 will be due upon the successful testing of Jindal coal in our second generation test facility in Wyoming. We do not anticipate any significant royalty fees for approximately 12-18 months thereafter.

For the Three Months Ended September 30, 2023 and September 30, 2022

Revenues

We have generated no revenues for the three months ended September 30, 2023 and 2022.

Operating Expenses

Our operating expenses for the three months ended September 30, 2023 totaled $624,488, compared to $295,947 for the three month period in 2022. The primary component of the operating expenses for the three months ended September 30, 2023 and 2022 was general and administrative expenses, recognizing $621,488, compared to $292,947 for the three months ended September 30, 2022. The $328,541, or 112% increase is mainly due to the issuance of 1,700,000 shares of common stock for services valued at $340,000 during the three months ended September 30, 2023, we had no such expense during the comparable prior period.

Other Income and Expenses

During the three months ended September 30, 2023, we recognized total other expense of $71,678 compared to total other expense of $381,361 for the three months ended September 30, 2022. The $309,683 decrease is mainly due to a $332,422 decrease in interest expense, partially offset by a $22,739 decrease in gain on change in fair value of share settled debt.

Net Income/Loss

For the three months ended September 30, 2023, we had net loss of $696,166, compared to a net loss of $677,308 for the three months ended September 30, 2022. The $18,858 increase in net loss is mainly due to the $328,541 increase in operating expenses, as partially offset by the $309,683 decrease in other expenses, as discussed above.

For the Nine months Ended September 30, 2023 and 2022

Revenues

We have generated no revenues for the nine months ended September 30, 2023 and 2022.

Operating Expenses

Our operating expenses for the nine months ended September 30, 2023 totaled $1,217,607 compared to $919,985 for the nine month period in 2022. The primary component of the operating expenses for the nine months ended September 30, 2023 was general and administrative expenses of $1,208,607, compared to $910,400 for the nine months ended September 30, 2022. Research and development expenses decreased $585 during the nine months ended September 30, 2023 to $9,000, compared to $9,585 during the nine months ended September 30 2022.

Other Income and Expenses

During the nine months ended September 30, 2023, we recognized total other expense of $6,121,609, compared to $1,197,705 for the nine months ended September 30, 2022. Most of the $4,923,904 increase is due to a $6,572,723 loss on settlement of notes and convertible notes payable, related party during the nine months ended September 30, 2023. The increase is partially offset by a $385,524 increase in gain on settlement of convertible notes payable, a $960,711, or approximately 84%, decrease in interest expense and a $302,584, or approximately 600%, increase in gain on change in fair value of share settled debt.

Net Income/Loss

For the nine months ended September 30, 2023, we had net loss of $7,339,216, compared to a net loss of $2,117,690 for the nine months ended September 30, 2022. The $5,221,526 increase in net loss is mainly due to the $4,923,904 increase in other expenses as well as the $297,622 increase in loss from operations, as discussed above.

We anticipate losses from operations will increase during the next twelve months due to anticipated increased payroll expenses as we add necessary staff and increases in legal and accounting expenses associated with maintaining a reporting company. We expect that we will continue to have net losses from operations for several years until revenues from operating facilities become sufficient to offset operating expenses, unless we are successful in the sale of licenses for our technology.

Liquidity and Capital Resources

We have generated minimal revenues since inception. We have obtained cash for operating expenses through advances and/or loans from affiliates and stockholders, the sale of common stock, the issuance of loans and convertible debentures.

Net Cash Used in Operating Activities. Our primary source of operating cash during the nine months ended September 30, 2023 was borrowings on related party debt, third party debt and convertible debt. Our primary uses of funds in operations were the completion of the construction of the test facility including the testing of the plant, the payment of professional and consulting fees and general operating expenses.

Net cash used in operating activities was $241,311 for the nine months ended September 30, 2023, compared to $418,843 for the same period in 2022. The $177,532 decrease is mainly a result of a $6,232,849 increase in non-cash expense adjustments such as gains and losses on settlement of convertible notes payable and notes and convertible notes payable, related party, debt discount amortization, lease asset amortization, loan extension fees and changes in fair value of share-settled debt. The increases in non-cash expenses are partially offset by the $5,221,526 increase in net loss and a $833,791 reduction in the payments of accounts payable and accrued expenses during the nine months ended September 30, 2023 compared to the 2022 period.

Net Cash Used In Investing Activities. There was a $235,500 expense in deposits on acquisition during the nine months ended September 30, 2023, with no such expense in the comparable period last year.

Net Cash Provided by Financing Activities. Net cash provided by financing activities during the nine months ended September 30, 2023 totaled $476,998, compared to $418,866 during the nine months ended September 30, 2022. During the nine months ended September 30, 2023 and 2022, we received $75,000 and $0 from the sales of common stock for cash, $48,390 and $428,866 from the issuance of notes payable to a related party, and $650,000 and $0 from the issuance of convertible notes payable, respectively. We repaid $296,390 and $10,000 of notes payable to a related party during the nine months ended September 30, 2023 and 2022, respectively.

Cash Position and Outstanding Indebtedness

At September 30, 2023, we had $235,687 in total assets, consisting of $187 in cash, $235,500 in deposits on acquisition and $7,000 in right-to-use assets. We had $9,842,799 in liabilities, all current liabilities consisting primarily of accounts payable, accrued liabilities, short-term convertible and non-convertible debt and related party convertible and non-convertible debt.

At December 31, 2022, we had total assets of $16,000 and $31,482,738 in liabilities, which consisted of $31,464,138 in current liabilities and $18,600 in long-term liabilities. Current liabilities consist primarily of accounts payable, accrued liabilities, short-term convertible and non-convertible debt and related party convertible and non-convertible debt.

Our working capital deficit at September 30, 2023 and December 31, 2022 was $9,607,112 and $31,464,138, respectively.

Contractual Obligations and Commitments

We secured a permanent location in Gillette, Wyoming for our test facility. The term of the lease is three years and calls for rent of $36,000, prepaid. In April, 2021 the company signed and executed an extension to the lease for the site at Fort Union, Wyoming for an additional three years to April 30, 2024. The rent of $36,000 was paid in advance by the company in April, 2021.

We lease office space in New York, NY on a month-to-month basis, at a monthly rate of $200 per month.

Our engineering consultants has tentatively estimated construction costs for each one million short ton coal complete cleaning facility of approximately $250 million (excluding land costs) or costs and for a similar size Pristine-M-only facility of approximately $30-35 million (excluding land costs). All intellectual property rights associated with new art developed by our engineering consultants remain our property.

We are also actively pursuing technology license and royalty agreements in order to begin construction of other facilities without incurring the capital costs associated with the construction of future plants.

In November 2015, we entered into a month-to-month agreement with South of the Rose communication to manage our Investor Relations needs and manage social media requirements.

Construction of the coal testing plant was completed in 2015 and testing commenced in December 2015 at the AES Coal Power Utility in Oklahoma. As of September 30, 2022, we have paid $11,259,224 in development costs. The facility was moved to Wyoming in the first quarter of 2019. We anticipate that there will be an additional cost of approximately $4 million to acquire the additional parts for the second-generation test facility and for its assembly.

Based on our current operational costs and including the capital requirements for our project deployments, we estimate we will need a total of approximately $5,000,000 to fund the Company for the fiscal year 2023 for plant re-assembly and operating costs and an additional $4,000,000 to continue for the following fiscal year (2024) or until an initial commercial plant is up and running.

Off-Balance Sheet Arrangements

We have not and do not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of establishing off-balance sheet arrangements or other contractually narrow or limited purposes. Therefore, we do not believe we are exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in such relationships.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to changes in prevailing market interest rates affecting the return on our investments but do not consider this interest rate market risk exposure to be material to our financial condition or results of operations. We invest primarily in United States Treasury instruments with short-term (less than one year) maturities. The carrying amount of these investments approximates fair value due to the short-term maturities. Under our current policies, we do not use derivative financial instruments, derivative commodity instruments or other financial instruments to manage our exposure to changes in interest rates or commodity prices.

ITEM 4. CONTROLS AND PROCEDURES

As of September 30, 2023, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended. Based on this evaluation, management concluded that our financial disclosure controls and procedures were not effective due to our limited internal resources and lack of ability to have multiple levels of transaction review. There is a lack of appropriate segregation of duties within the Company, no control documentation being produced, and no one to review control documentation if it was being produced. As of September 30, 2023, we had two full time officers of the company.

There were no changes in internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially effect, our internal controls and procedures. We do not expect to implement any changes to our controls and procedures until there is a significant change in our operations or capital resources.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

As part of the separation agreement with Mr. Ponce de Leon, the ex COO of the Company, the Company agreed to pay him his accrued salary of $1,226,711 within two years but agreed to pay him $200,000 by November 2015 out of revenues earned. As the Company did not earn revenue in 2015 and as at December 2017 has still not earned revenue, the obligation to Mr. Ponce de Leon is currently in default. It is the Company’s intention to pay Mr. Ponce de Leon immediately upon receiving revenue including any interest that has been accrued. As of September 30, 2023, the Company has accrued a total of $1,962,735 in accrued salary and interest.

ITEM 1A. RISK FACTORS

For information regarding risk factors, see “Part I. Item 1A. Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2022.

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

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.