UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





(Mark
One)


þ
              Quarterly
      Report Under Section 13 or 15(d) of the Securities Exchange Act of
      1934For
      the quarterly period ended June 30, 2009o
              Transition
      Report Under Section 13 or 15(d) of the Securities Exchange Act of
      1934For
      the transition period from to





Commission
File Number 000-03125





MEDCLEAN TECHNOLOGIES,
INC.


(Exact
Name of Registrant as Specified in Its Charter)





Delaware
                21-0661726(State
      or other Jurisdiction of
                (I.R.S.
      Employerincorporation
      or organization)
                Identification
      Number)





3
Trowbridge Drive


Bethel, Connecticut
06801


(Address
of Principal Executive offices)





(203)
798-1080


(Issuer’s
Telephone Number)





Indicate
by check mark whether the registrant: (1) has filed all reports required to be
filed by Section


13 or
15(d) of the Exchange Act 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
þ
No  o





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of “accelerated
filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
one):





Large
      Accelerated Filer  o
            
            Accelerated
      Filer                    oNon-Accelerated
      Filer    o
            
            Smaller
      Reporting Company þ





Indicate
by check mark whether the registrant is a shell company (as defined
in


Rule
12b-2 of the Exchange Act). Yes o No þ





As of
August 3, 2009, 561,542,968 shares of the issuer’s common stock (par value
$0.0001 per share) were outstanding.









TABLE OF
CONTENTS








PART
I--FINANCIAL INFORMATION





PageItem
      1: Financial Statements
                    F1
      – F11Item
      2: Management's Discussion and Analysis or Plan of
    Operation
                    3Item
      3: Quantitative and Qualitative disclosures about Market
    Risk
                    7Item
      4: Controls and Procedures
                    7PART
      II--OTHER INFORMATIONItem
      1: Legal Proceedings
                    8Item1A:
      Risk Factors
                    8Item
      2: Unregistered Sales of Equity Securities and Use of
    Proceeds
                    8Item
      3: Defaults Upon Senior Securities
                    8Item
      4: Submission of Matters to a Vote of Security Holders
                    8Item
      5: Other Information
                    8Item
      6: Exhibits
                    9Signatures
                    9









2


PART
I--FINANCIAL INFORMATION





Item
1. Financial Statements














`








INDEX TO
CONSOLIDATED FINANCIAL STATEMENTS








PAGECONDENSED
      CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2009 AND DECEMBER 31,
      2008
                                  F2UNAUDITED
      CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                    FOR
      THE THREE MONTHS ENDED JUNE 30, 2009 AND 2008
                                  F3UNAUDITED
      CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                    FOR
      THE SIX MONTHS ENDED JUNE 30, 2009 AND 2008
                                  F4UNAUDITED
      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                    FOR
      THE SIX MONTHS ENDED JUNE 30, 2009 AND 2008
                                  F5NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS
                                  F6








F-1


MEDCLEAN
TECHNOLOGIES, INC.





CONDENSED
CONSOLIDATED BALANCE SHEETS







June 30,
                                
                                
                                December 31,ASSETS
                                
                                2009
                                
                                
                                2008(Unaudited)Current
      assetsCash
                                
                                $
                                166,191
                                
                                
                                $
                                1,922,401Accounts receivable (net
      of $23,081 allowance)
                                
                                
                                154,579
                                
                                
                                
                                176,284Revenues
      in excess of billings
                                
                                
                                7,679
                                
                                
                                
                                7,679Inventory
                                
                                
                                1,307,915
                                
                                
                                
                                886,351Prepaid
      expenses
                                
                                
                                84,542
                                
                                
                                
                                24,925Total
      current assets
                                
                                
                                1,720,906
                                
                                
                                
                                3,017,640Property,
      plant and equipment, net
                                
                                
                                264,454
                                
                                
                                
                                285,304Long
      term deposits
                                
                                
                                38,260
                                
                                
                                
                                38,260Total
      assets
                                
                                $
                                2,023,620
                                
                                
                                $
                                3,341,204LIABILITIES
      AND STOCKHOLDERS' EQUITY (DEFICIT)Current
      liabilitiesAccounts
      payable and accrued liabilities
                                
                                $
                                265,959
                                
                                
                                $
                                653,785Payroll
      Liabilities
                                
                                
                                223,374
                                
                                
                                
                                390,857Deferred
      revenue
                                
                                
                                142,475
                                
                                
                                
                                136,691Customer
      deposits
                                
                                
                                -
                                
                                
                                
                                386,428Billings
      in excess of revenue
                                
                                
                                1,506,888
                                
                                
                                
                                620,639Notes
      payable
                                
                                
                                208,797
                                
                                
                                
                                202,947Total
      current liabilities
                                
                                
                                2,347,493
                                
                                
                                
                                2,391,347Total
      liabilities
                                
                                
                                2,347,493
                                
                                
                                
                                2,391,347Stockholders'
      equity (deficit)Common stock:$.0001 par
      value; 3,500,000,000 shares authorized; 561,542,968 shares issued and
      outstanding
                                
                                
                                56,154
                                
                                
                                
                                56,154Additional
      paid-in capital
                                
                                
                                24,266,657
                                
                                
                                
                                20,988,502Accumulated
      deficit
                                
                                
                                (24,646,684
                                )
                                
                                
                                (20,094,799
                                )Total
      stockholders' equity (deficit)
                                
                                
                                (323,873
                                )
                                
                                
                                949,857Total
      liabilities and stockholders'  equity (deficit)
                                
                                $
                                2,023,620
                                
                                
                                $
                                3,341,204






See Notes
to Consolidated Financial Statements




F-2




MEDCLEAN
TECHNOLOGIES, INC.
 
 CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited)






For
      the Three Months EndedJune 30,2009
                          
                          
                          2008RevenuesContract
      revenues earned
                          
                          $
                          -
                          
                          
                          $
                          330,739Sales
      and service revenues
                          
                          
                          354,755
                          
                          
                          
                          187,216Total
      revenues
                          
                          
                          354,755
                          
                          
                          
                          517,955Cost
      of sales
                          
                          
                          225,965
                          
                          
                          
                          333,484Gross
      profit
                          
                          
                          128,790
                          
                          
                          
                          184,471Operating
      expensesSalary
      and wages
                          
                          
                          1,995,716
                          
                          
                          
                          362,899General
      and administrative expenses
                          
                          
                          332,018
                          
                          
                          
                          474,394Depreciation
      expense
                          
                          
                          21,050
                          
                          
                          
                          21,956Total
      operating expenses
                          
                          
                          2,348,784
                          
                          
                          
                          859,249Loss
      from operations
                          
                          
                          (2,219,994
                          )
                          
                          
                          (674,778
                          )Other
      income and expensesInterest
      income
                          
                          
                          38
                          
                          
                          
                          239Interest
      expense
                          
                          
                          (448,203
                          )
                          
                          
                          (836,081
                          )Total
      other income and expenses
                          
                          
                          (448,165
                          )
                          
                          
                          (835,842
                          )Net
      loss before income taxes
                          
                          
                          (2,668,159
                          )
                          
                          
                          (1,510,620
                          )Provision
      for income tax benefit
                          
                          
                          -
                          
                          
                          
                          -Net
      loss
                          
                          $
                          (2,668,159
                          )
                          
                          $
                          (1,510,620
                          )Basic
      and diluted net loss per common share
                          
                          $
                          -
                          
                          
                          $
                          (0.07
                          )Weighted
      average common shares outstanding
                          
                          
                          561,542,968
                          
                          
                          
                          22,015,101






See Notes
to Consolidated Financial Statements




F-3




MEDCLEAN
TECHNOLOGIES, INC.
 
 CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited)






For
      the Six months endedJune 30,2009
                          
                          
                          2008RevenuesContract
      revenues earned
                          
                          $
                          -
                          
                          
                          $
                          854,223Sales
      and service revenues
                          
                          
                          772,182
                          
                          
                          
                          351,758Total
      revenues
                          
                          
                          772,182
                          
                          
                          
                          1,205,981Cost
      of sales
                          
                          
                          499,037
                          
                          
                          
                          809,082Gross
      profit
                          
                          
                          273,145
                          
                          
                          
                          396,899Operating
      expensesSalaries
      and wages
                          
                          
                          3,063,579
                          
                          
                          
                          801,362General
      and administrative expenses
                          
                          
                          821,536
                          
                          
                          
                          972,319Depreciation
      expense
                          
                          
                          44,159
                          
                          
                          
                          44,315Total
      operating expenses
                          
                          
                          3,929,274
                          
                          
                          
                          1,817,996Loss
      from operations
                          
                          
                          (3,656,129
                          )
                          
                          
                          (1,421,097
                          )Other
      income and expensesInterest
      income
                          
                          
                          944
                          
                          
                          
                          614Interest
      expense
                          
                          
                          (896,700
                          )
                          
                          
                          (1,613,932
                          )Total
      other income and expenses
                          
                          
                          (895,756
                          )
                          
                          
                          (1,613,318
                          )Net
      loss before income taxes
                          
                          
                          (4,551,885
                          )
                          
                          
                          (3,034,415
                          )Provision
      for income tax benefit
                          
                          
                          -
                          
                          
                          
                          -Net
      loss
                          
                          $
                          (4,551,885
                          )
                          
                          $
                          (3,034,415
                          )Basic
      and diluted net loss per common share
                          
                          $
                          (0.01
                          )
                          
                          $
                          (0.15
                          )Weighted
      average common shares outstanding
                          
                          
                          561,542,968
                          
                          
                          
                          21,895,940


See Notes
to Consolidated Financial Statements


F-4


MEDCLEAN
TECHNOLOGIES, INC.
 
 CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited)




Six
      months endedJune 30,2009
                                    
                                    
                                    2008Cash
      flows from operating activities:Net
      loss
                                    
                                    $
                                    (4,551,885
                                    )
                                    
                                    $
                                    (3,034,415
                                    )Adjustments
      to reconcile net loss tonet
      cash used in operations:Stocks,
      Warrants and options issued for services
                                    
                                    
                                    3,278,155
                                    
                                    
                                    
                                    1,732,698Depreciation
      expense
                                    
                                    
                                    44,159
                                    
                                    
                                    
                                    44,315Disposal
      of Fixed Assets
                                    
                                    
                                    -
                                    
                                    
                                    
                                    6,578Changes
      in operating assets and liabilities:Accounts
      receivable
                                    
                                    
                                    21,705
                                    
                                    
                                    
                                    683,642Revenues
      in excess of billings
                                    
                                    
                                    -
                                    
                                    
                                    
                                    (55,535
                                    )Inventory
                                    
                                    
                                    (421,564
                                    )
                                    
                                    
                                    269,840Prepaid
      expenses
                                    
                                    
                                    (59,617
                                    )
                                    
                                    
                                    55,350Accounts
      payable and accrued liabilities
                                    
                                    
                                    (555,309
                                    )
                                    
                                    
                                    99,442Deferred
      revenue
                                    
                                    
                                    5,784
                                    
                                    
                                    
                                    (87,689
                                    )Billings
      in excess of revenue
                                    
                                    
                                    886,249
                                    
                                    
                                    
                                    (368,197
                                    )Interest
      on notes payable
                                    
                                    
                                    5,850
                                    
                                    
                                    
                                    5,850Customer
      deposits
                                    
                                    
                                    (386,428
                                    )
                                    
                                    
                                    -Dividends
      payable
                                    
                                    
                                    -
                                    
                                    
                                    
                                    210,000Net
      cash used in operating activities
                                    
                                    
                                    (1,732,901
                                    )
                                    
                                    
                                    (438,121
                                    )Cash
      flows from investing activities:Purchase
      of fixed assets
                                    
                                    
                                    (23,309
                                    )
                                    
                                    
                                    -Net
      cash used in investing activities
                                    
                                    
                                    (23,309
                                    )
                                    
                                    
                                    -Cash
      flows from financing activities:Repayments
      of notes payable
                                    
                                    
                                    -
                                    
                                    
                                    
                                    (52,519
                                    )Issuance
      of note payable
                                    
                                    
                                    -
                                    
                                    
                                    
                                    300,000Increase
      in line of credit
                                    
                                    
                                    -
                                    
                                    
                                    
                                    50,000Net
      cash provided by financing activities
                                    
                                    
                                    -
                                    
                                    
                                    
                                    297,481Decrease
      in cash and cash equivalents
                                    
                                    
                                    (1,756,210
                                    )
                                    
                                    
                                    (140,640
                                    )Cash
      and cash equivalents, beginning of period
                                    
                                    
                                    1,922,401
                                    
                                    
                                    
                                    212,215Cash
      and cash equivalents, end of period
                                    
                                    $
                                    166,191
                                    
                                    
                                    $
                                    71,575Supplemental
      disclosures of cash flow information:Cash
      paid for interest
                                    
                                    $
                                    883
                                    
                                    
                                    $
                                    77,131Supplemental
      disclosures of non-cash investing and financing
activities:Accrual
      of preferred stock dividends
                                    
                                    $
                                    -
                                    
                                    
                                    $
                                    210,000






See Notes
to Consolidated Financial Statements




F-5


MEDCLEAN
TECHNOLOGIES, INC.
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS





1.
            BASIS
      OF PRESENTATION





The
condensed consolidated balance sheets of MedClean Technologies Inc., and
subsidiaries (“MedClean”, the “Company”, “MTI”) as of June 30, 2009 and December
31, 2008, the condensed consolidated statements of operations for the three and
six month periods ended June 30, 2009 and 2008, and the condensed consolidated
statements of cash flows for the six month periods ended June 30, 2009 and 2008
have been prepared by the Company without audit. In the opinion of management,
the information contained herein reflects all adjustments necessary to make the
presentation of the Company’s condensed financial position, results of
operations and cash flows not misleading.  All such adjustments are of
a normal recurring nature.





The
accompanying condensed consolidated financial statements do not contain all of
the information and disclosures required by accounting principles generally
accepted in the United States of America and should be read in conjunction with
the consolidated financial statements and related notes included in the
Company’s annual report on Form 10-K for the fiscal year ended December 31,
2008, filed on March 24, 2009 and amended on April 17, 2009.





The
accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern, which contemplates the realization
of assets and satisfaction of liabilities and commitments in the normal course
of business. The Company has incurred substantial recurring losses, which raises
substantial doubt about its ability to continue as a going concern. The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.





The
Company has available cash and cash equivalents of approximately
$166,191 at June 30, 2009 which it intends to utilize for working capital
purposes and to continue developing its business. To supplement its cash
resources, the Company has been pursuing a number of alternative financing
arrangements with various investment entities. We are currently looking to
secure additional working capital to provide the necessary funds for us to
execute our business plan through various sources, including bank facilities,
bridge loans and equity offerings. However, we continue to incur significant
operating losses and the resultant reduction of our cash position.  We
cannot assure that we will be able to obtain additional funding, and the lack
thereof would have a material adverse impact on our business. Moreover, any
equity funding could be substantially dilutive to existing stockholders. The
aforementioned factors raise substantial doubt about our ability to continue as
a going concern. In the event the Company is unable to continue as a going
concern it may pursue a number of different options, including, but not limited
to, filing for protection under the federal bankruptcy code.





2.
            BUSINESS
      DESCRIPTION - ORGANIZATION





On
January 2, 2009, the Company merged its wholly owned subsidiary, Aduromed
Corporation into Aduromed Industries Inc. and changed its corporate name from
Aduromed industries, Inc. to MedClean Technologies, Inc.





MedClean
is in the business of providing solutions for managing medical waste on site
including designing, selling, installing and servicing on site (i.e. "in-situ ") turnkey systems
to treat regulated medical waste. The Company provides these systems to
hospitals and other medical facilities as efficient, safe, cost effective and
legally compliant solutions to incineration, off site hauling of untreated waste
and other alternative treatment technologies and methodologies. The MedClean
Series System is offered in three configurations: Containerized System, Mobile
System and the Fixed System (our traditional fixed installation).














F-6


MEDCLEAN
TECHNOLOGIES, INC.
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS




3.
            SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES





EARNINGS
(LOSS) PER COMMON SHARE





The net
earnings (loss) per common share are computed by dividing the net loss for the
period by the weighted average number of shares outstanding for the period.
Outstanding warrants and options for the period ending June 30, 2009 and 2008
amounting to 953,435,058 and 43,943,271 respectively were not included in the
calculation for net loss per common share because it would be
antidilutive.





Outstanding
Preferred A and B class of stock nor the common stock equivalents associated
with the conversion feature for the period ending June 30, 2008 amounting to
22,043,862 of both classes of Preferred stock were not included in the
calculation for net loss per common share as it would be
antidilutive.





The
numerator and denominator used in the basic and diluted earnings (loss) per
share of common stock computations are presented in the following
table:





Six months ended June 30,
                  
                  
                  Three months ended June 30,2009
                  
                  
                  2008
                  
                  
                  2009
                  
                  
                  2008NUMERATOR
      FOR BASIC AND DILUTED EPS (LPS)Net
      loss per statement of operations
                  
                  $
                  (4,551,885
                  )
                  
                  $
                  (3,034,415
                  )
                  
                  $
                  (2,668,159
                  )
                  
                  $
                  (1,510,620
                  )Dividend
      payable to preferred stockholders
                  
                  
                  -
                  
                  
                  
                  (210,000
                  )
                  
                  
                  -
                  
                  
                  
                  (105,000
                  )Net
      loss to common stockholders
                  
                  $
                  (4,551,885
                  )
                  
                  $
                  (3,244,415
                  )
                  
                  $
                  (2,668,159
                  )
                  
                  $
                  (1,615,620
                  )DENOMINATOR
      FOR BASIC AND DILUTED EPS (LPS)Weighted
      average shares of common stock outstanding
                  
                  
                  561,542,968
                  
                  
                  
                  21,895,940
                  
                  
                  
                  561,542,968
                  
                  
                  
                  22,015,101Basic
      and diluted EPS (LPS)
                  
                  $
                  (0.01
                  )
                  
                  $
                  (0.15
                  )
                  
                  $
                  (0.00
                  )
                  
                  $
                  (0.07
                  )




USE OF
ESTIMATES





The
preparation of the accompanying financial statements, in conformity with
generally accepted accounting principles, requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities, and
disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenue and expenses during the
reporting periods. Actual results could differ from those
estimates.





CASH AND
CASH EQUIVALENTS





The
Company considers all highly liquid debt instruments purchased with an original
maturity of three months or less to be cash equivalents.





The
Company maintains cash deposits with financial institutions, which from time to
time may exceed federally insured limits.  The Company has not
experienced any losses and believes it is not exposed to any significant credit
risk from cash. At June 30, 2009, the Company has no cash balances on deposit in
any one account with a financial institution in excess of the federally insured
limits.






F-7


MEDCLEAN
TECHNOLOGIES, INC.
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS


CONTROL
BY PRINCIPAL STOCKHOLDERS





The
directors, executive officers, participants in the Master Restructuring
Agreement and their affiliates or related parties, own beneficially and in the
aggregate, the majority of the voting power of the outstanding shares of the
common stock of the Company. Accordingly, the directors, executive officers and
their affiliates, if they voted their shares uniformly, would have the ability
to control the approval of most corporate actions, including increasing the
authorized capital stock of the Company and the dissolution, merger or sale of
the Company's assets.





DEPENDENCE
ON PRINCIPAL CUSTOMER





For 2009
and going forward, we do not anticipate that the loss of any one customer will
have a significant adverse impact on our business.





ACCOUNTS
RECEIVABLE





The
Company maintains an accounts receivable ledger to track amounts due from
individual customers. The Company continuously monitors the creditworthiness of
its customers and has established an allowance for amounts that may be
uncollectible in the future based on current economic conditions, historical
payments and specific customer related collection issues. The allowance for bad
debts was $23,081 as of June 30, 2009 and December 31, 2008.





PROPERTY,
PLANT AND EQUIPMENT





The
Company has property, plant and equipment that consist of automobiles, computers
and related accessories, and office furniture.  The depreciation is
calculated using the straight line method over the life of the
property.  All property has a useful life of 3 to 10
years.  The following table summarizes these assets as of June 30,
2009 and December 31, 2008:




June 30,
                    
                    
                    December 31,2009
                    
                    
                    2008Office
      Furniture
                    
                    
                    164,525
                    
                    
                    
                    164,525Computers
      and Accessories
                    
                    
                    212,017
                    
                    
                    
                    206,091Leasehold
      Improvements
                    
                    
                    135,380
                    
                    
                    
                    117,997511,922
                    
                    
                    
                    488,613Accumulated
      Depreciation
                    
                    
                    247,468
                    
                    
                    
                    203,309264,454
                    
                    
                    
                    285,304




INVENTORY





The
Company maintains an inventory, which consists primarily of component parts,
spare parts and disposable goods.  The average cost method is utilized
in valuing the inventory, and is stated at the lower of cost or
market.  The following table summarizes these assets as of June 30,
2009 and December 31, 2008:





June 30,
                          
                          
                          December 31,2009
                          
                          
                          2008Component
      & spare parts
                          
                          
                          1,290,704
                          
                          
                          
                          754,476Consumables
                          
                          
                          17,211
                          
                          
                          
                          21,234Advance
      payments
                          
                          
                          -
                          
                          
                          
                          110,641Total
      inventory
                          
                          
                          1,307,915
                          
                          
                          
                          886,351








F-8


MEDCLEAN
TECHNOLOGIES, INC.
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS





BUSINESS
COMBINATION





On
January 2, 2009, the Company merged its subsidiary Aduromed Corporation into the
parent corporation: Aduromed Industries, Inc. and changed its corporate name
from Aduromed Industries, Inc. to MedClean Technologies, Inc.





REVENUE
RECOGNITION





The
Company recognizes revenues from fixed-price and modified fixed-price
construction type contracts on the percentage-of-completion method, measured by
the percentage of cost incurred to date to estimated total cost for each
contract. That method is used because management considers total cost to be the
best available measure of progress on the contracts. Because of inherent
uncertainties in estimating costs, it is at least reasonably possible that the
estimates used will change within the near term. Prior to 2009, the Company has
billed 25% of the contract at signing, 50% upon delivery of components, and the
final 25% upon completion of installation and start-up. Beginning in 2009 we
will bill 60% of the contracts at signing, 20% upon delivery of components, and
the final 20% upon completion of installation and start-up.





Contract
costs include all direct material and labor costs and those indirect costs
related to contract performance. Selling, general and administrative costs are
charged to expense as incurred. Provisions for estimated losses on uncompleted
contracts are made in the period in which such losses are determined. Changes in
job performance, job conditions, and estimated profitability may result in
revisions to costs and income, which are recognized in the period in which the
revisions are determined. Changes in estimated job profitability resulting from
job performance, job conditions, contract penalty provisions, claims, change
orders, and settlements, are accounted for as changes in estimates in the
current period.





Revenues
from direct sales of our mobile unit will be recognized as we ship units. The
Company provides a one year warranty on the systems it installs. The Company
also obtains a one year warranty on the system components from the component
manufacturer, thereby mitigating potential warranty costs. Accordingly, the
Company has accrued no reserve for warranty. On the installed base after the
warranty term has expired the Company offers a maintenance agreement of one or
more years to the customer. The Customer is billed for, and pays for the
maintenance agreement in advance. Revenues from such maintenance agreements are
recognized ratably over the lives of the maintenance agreements, with the excess
of the amount collected over the amount recognized as deferred revenue. At June
30, 2009 and December 31, 2008 the Company had $142,475 and $136,691 in deferred
revenue from maintenance agreements.





Revenues
from the sale of our mobile unit, accessories, repairs and replacement parts are
recognized when shipped to the customer in accordance with a valid contract or
order agreement. The contract or order agreement specifies delivery terms and
pricing, and is considered to reasonably assure collection from the
customer.





Revenues
and cost from multi-year rental contracts on our mobile unit will be recognized
ratably over the life of the rental contract.





4.
            CONTRACTS
      IN PROGRESS





The
Company entered into construction type contracts to furnish and install its
systems in hospitals. There were seven and five outstanding contracts at June
30, 2009 and December 31, 2008, respectively.  The following table
summarizes these outstanding contracts:





F-9


MEDCLEAN
TECHNOLOGIES, INC.
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS





Contract
                    
                    
                    Revenue
                    
                    
                    Amounts
                    
                    
                    Revenues
      in
                    
                    
                    Billings
      in excessAmount
                    
                    
                    Recognized
                    
                    
                    Billed
                    
                    
                    excess of Billings
                    
                    
                    of RevenuesOutstanding
      contracts at June 30, 20091,327,930
                    
                    
                    
                    949,221
                    
                    
                    
                    1,327,930
                    
                    
                    
                    -
                    
                    
                    
                    378,709231,257
                    
                    
                    
                    29,347
                    
                    
                    
                    21,668
                    
                    
                    
                    7,679
                    
                    
                    
                    -287,029
                    
                    
                    
                    163,939
                    
                    
                    
                    215,271
                    
                    
                    
                    -
                    
                    
                    
                    51,332282,948
                    
                    
                    
                    -
                    
                    
                    
                    188,632
                    
                    
                    
                    -
                    
                    
                    
                    188,632559,594
                    
                    
                    
                    528,426
                    
                    
                    
                    530,392
                    
                    
                    
                    -
                    
                    
                    
                    1,966280,000
                    
                    
                    
                    -
                    
                    
                    
                    210,000
                    
                    
                    
                    -
                    
                    
                    
                    210,000966,069
                    
                    
                    
                    -
                    
                    
                    
                    676,249
                    
                    
                    
                    -
                    
                    
                    
                    676,2493,934,827
                    
                    
                    
                    1,670,933
                    
                    
                    
                    3,170,142
                    
                    
                    
                    7,679
                    
                    
                    
                    1,506,888Outstanding
      contracts at December 31, 20081,327,930
                    
                    
                    
                    949,221
                    
                    
                    
                    1,327,930
                    
                    
                    
                    -
                    
                    
                    
                    378,709231,257
                    
                    
                    
                    29,347
                    
                    
                    
                    21,668
                    
                    
                    
                    7,679
                    
                    
                    
                    -287,029
                    
                    
                    
                    163,939
                    
                    
                    
                    215,271
                    
                    
                    
                    -
                    
                    
                    
                    51,332282,948
                    
                    
                    
                    -
                    
                    
                    
                    188,632
                    
                    
                    
                    -
                    
                    
                    
                    188,632559,594
                    
                    
                    
                    528,426
                    
                    
                    
                    530,392
                    
                    
                    
                    -
                    
                    
                    
                    1,9662,688,758
                    
                    
                    
                    1,670,933
                    
                    
                    
                    2,283,893
                    
                    
                    
                    7,679
                    
                    
                    
                    620,639





5.
            NOTES
      PAYABLE





There is
an outstanding note payable.  The note bears a 12% interest rate and
matured on December 15, 2003. Both parties have entered a verbal agreement to
extend the maturity date on this note indefinitely. No accrued interest has been
paid on this note to date. As of June 30, 2009 and December 31, 2008 the balance
due was $208,797 and $202,947 respectively.





6.
            COMMON
      STOCK





On April
22, 2009, we increased our authorized common shares to 3.5 billion shares
pursuant to a vote of our majority stockholders.





On May 1,
2009, the Company issued options to purchase 461 million shares of MedClean’s
common stock in consideration of employees accepting no and or reduced
compensation for a specified period of time. The option grants as approved by
the Compensation Committee were fully vested when issued and the exercise price
is $0.004 per share.





The fair
value for these awards was estimated using the Black-Scholes option pricing
model with the following weighted average assumptions, assuming no expected
dividends:




Three Months Ended June 30,2009
                
                
                2008Expected
      life (years)
                
                
                5
                
                
                
                5Expected
      volatility
                
                
                255.30
                %
                
                
                113.19
                %Risk-free
      interest rate
                
                
                1.98
                %
                
                
                3.14Dividend
      yield
                
                
                —
                %
                
                
                —
                %




The
expected volatilities are based on the historical volatility of the Company’s
common stock.  The observation is made on a daily
basis.  The observation period covered is consistent with the expected
life of the options.  The expected life of stock options is based on
the minimum vesting period required.  The risk-free rate is consistent
with the expected terms of the stock options and is based on the United States
Federal Reserve data system yield curve in effect at the time of
grant.




F-10


MEDCLEAN
TECHNOLOGIES, INC.
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS


During
the three months ended June 30, 2009 and 2008, the stock compensation expenses
were $1,783,636 and $43,750, respectively.





7.
            SUBSEQUENT
      EVENT




As of the
end of business on June 30, 2009, pursuant to its private offer to exchange all
of the Company's existing Common Stock Purchase Warrants with Initial Exercise
Dates between July 11, 2008 and August 29, 2008 ("Existing Warrants") for newly
issued Common Stock Purchase Warrants with a new lower exercise price of $0.0075
per share, exercisable for one-half the original number of shares of our common
stock, par value $0.0001 per share ("Common Stock"), and without a "cashless
exercise" right exchanged 334,838,221 Existing Warrants for 167,419,111 common
stock purchase warrants with an exercise price of $0.0075 per share and
28,000,000 common stock purchase warrants with an exercise price of $0.025
remain outstanding.
















































F-11








Item
2. Management's Discussion and Analysis or Plan of Operation





Forward
Looking Statements





The
Company is including the following cautionary statement in this Interim Report
on Form 10-Q for any forward-looking statements made by, or on behalf of, the
Company. Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance and underlying
assumptions and other statements which are other than statements of historical
facts. Certain statements contained herein are forward-looking statements and
accordingly involve risks and uncertainties which could cause actual results or
outcomes to differ materially from those expressed in the forward-looking
statements. Our expectations, beliefs and projections are expressed in good
faith and are believed by us to have a reasonable basis, including without
limitation, management’s examination of historical operating trends, data
contained in our records and other data available from third parties, but there
can be no assurance that management’s expectation, beliefs or projections will
result or be achieved or accomplished. In addition to other factors and matters
discussed elsewhere herein, the following are important factors that, in our
view, could cause actual results to differ materially from those discussed in
the forward-looking statements: technological advances by our competitors,
changes in health care reform, including reimbursement programs, changes to
regulatory requirements relating to environmental approvals for the treatment of
infectious medical waste, capital needs to fund any delays or extensions of
development programs, delays in the manufacture of new and existing products by
us or third party contractors, market acceptance of our products, the loss of
any key employees, delays in obtaining federal, state or local regulatory
clearance for new installations and operations, changes in governmental
regulations, availability of capital on terms satisfactory to us. We are also
subject to numerous Risk Factors relating to manufacturing, regulatory,
financial resources and personnel as described in our Annual Report on Form
10-K. We disclaim any obligation to update any forward-looking statements to
reflect events or circumstances after the date hereof.





Results
of Operations





Three
Months Ended June 30, 2009 Compared to Three Months Ended June 30,
2008





Net
Revenue





Total
revenue for the quarter ended June 30, 2009 was $354,755 compared with $517,955
for the same period in 2008, a reduction of $163,200 or 31.5%.





Revenues
derived from the sale of consumables, component parts, service billings and
amortization of maintenance contracts increased $167,539 or 89.5% in the current
quarter to $354,755. The increase in revenue was attributable to increased
billings for goods and services from an increased install base of hospitals that
have previously purchased our MedClean system.





In the
current quarter, we did not recognize any revenue from system installations. We
are currently working on two contracts amounting to approximately $1,246,000. We
expect to have these two contracts installed and recognize revenue in the third
quarter of 2009. The remaining contracts in backlog have not yet been
scheduled.








3




Gross
Profit




The gross
profit for the three months ended June 30, 2009 was $128,790 (36.3% of total
revenue) compared with a gross margin of $184,471 (35.6% of total revenue) for
the same three month period of 2008. Gross profit was impacted by the reduction
of revenue and improved margins.




Operating
Expenses




Total
operating expenses for the three months ended June 30, 2009 was $2,348,784
compared with $859,249 for the same three month period in 2008, an increase of
$1,489,535. In the three months ended June 30, 2009, we recognized non-cash
amortization expense for stock options issued amounting to $1,738,636 compared
to $43,750 in the same three month period of 2008.  The increase was due to
the amount of new options issued in the quarter. On May 1, 2009, the Company
issued options to purchase 461 million shares of MedClean’s common stock in
consideration of employees accepting no and or reduced compensation for a
specified period of time. The option grants as approved by the Compensation
Committee were fully vested when issued with an exercise price of $0.004 per
share. Additionally, certain employees and business consultants have agreed to
no compensation and or reduced compensation for a specified period of time. This
action among others to preserve cash has resulted in cash savings amounting to
$107,069 in salaries and wages, $151,358 saving in professional fees, $40,011 in
insurance costs and $20,325 in travel related costs. These savings were
partially offset by expanded facilities costs of $45,975, outsourcing our
Information Technology needs by $12,733 and all other operating expenses
increased $9,704 net.




Interest
Income




Interest
income for the quarter was $38 compared with $239 of interest income in the same
period of 2008.




Interest
Expense and Amortization




Interest
expense and amortization for the three month period ended June 30, 2009 was
$448,203 compared with $836,081 in the same three month period of 2008. Interest
expense for the three month period ended June 30, 2009, was $3,219 on decreased
borrowings as compared to $52,593 in the same period of 2008. In the three
months ended June 30, 2009, we recognized non-cash amortization expense
amounting to $444,984 compared to $783,488 in the same three month period of
2008.  The decrease was due to the conversion of debt to common stock as a
result of the Master Restructuring Agreement signed on August 4,
2008.




Net
loss




Net loss
for the current quarter was $(2,668,159) compared to a net loss for the same
period in 2008 of $(1,510,620).




Net
Loss Attributable to Common Stockholders




Net loss
attributable to common stockholders for this period of 2009 was $(2,668,159) or
$(0.00) cents per share (basic and diluted), compared to a net loss of
$(1,615,620) or $(0.07) cents per share (basic and diluted) for the same period
in 2008.




In the
three months ended June 30, 2008, the Company accrued $105,000 in dividends with
an interest rate of 6% on $7,000,000, the total value received for both series A
and B preferred stock. On August 4, 2008, all accrued dividends were settled for
the issuance of 42,960,480 shares of common stock.






4








Six
Months Ended June 30, 2009 Compared to Six Months Ended June 30,
2008





Net
Revenue





Total
revenue for the six months ended June 30, 2009 was $772,182 compared with
$1,305,981 for the same six month period of 2008.





Revenues
derived from the sale of consumables, component parts, service billings and
amortization of maintenance contracts more than doubled to $772,182 in the first
six months of 2009. The increase in revenue was attributable to increased
billings for goods and services from an increased install base of hospitals that
have previously purchased our MedClean system.





For the
first six months of 2009, we did not recognize any revenue from system
installations. As previously mentioned we are currently working on two contracts
amounting to approximately $1,246,000 which we expect to have these two
contracts installed and recognize revenue in the third quarter of 2009. The
remaining contracts in backlog have not yet been scheduled.





Orders
for the MedClean system are contracted by purchase order and are billed in 3
increments. Due to the size and off shore location of one active contract we
have asked for and received milestone billings for 40% of the contact value at
signing, 30% when the equipment is shipped to the customer and 30% upon
completion of installation. Consumables and component parts are billed when
shipped and service contracts are invoiced at the start of the service period
and revenue is pro-rated over the life of the contract.




Gross
Profit




The gross
profit for the six months ended June 30, 2009 was $273,145 (35.4% of total
revenue) compared with a gross profit of $396,899 (32.9% of total revenue) for
the same six month period of 2008. Gross profit was impacted by reduced sales
and improved margins.




The
components of costs of revenues for products include direct materials, shipping
and rigging costs and contract labor primarily used to install, repair and
maintain our equipment.




Operating
Expenses




Total
operating expenses for the six month period ended June 30, 2009 were $3,929,274
compared with $1,817,996 for the same six month period of 2008, an increase of
$2,111,278. In the six months ended June 30, 2009, we recognized non-cash
amortization expense for stock options issued amounting to $2,388,187 compared
to $111,372 in the same six month period of 2008.  The increase was due to
the amount of new options issued in the period. On May 1, 2009, the Company
issued options to purchase 461 million shares of MedClean’s common stock in
consideration of employees accepting no and or reduced compensation for a
specified period of time. The option grants as approved by the Compensation
Committee were fully vested when issued with a strike price of $0.004 per share.
Additionally, plans initiated to preserve cash have resulted in cash savings
amounting to $202,975 of professional fees, insurance costs of 56,727 and travel
related costs of $31,140.  These savings were partially offset by
expanded facilities costs of $87,148 and increased marketing efforts of $40,201.
All other operating costs decreased by a net $2,044.




Interest
(Income) Expense




Interest
income for the six months ended June 30, 2009 was $944 compared with $614 of
interest income in the same six month period of 2008.




Interest
expense and amortization for the six months ended June 30, 2009 was $896,700
compared with $1,613,932 in the same six month period of 2008. Interest expense
for the six month period ending June 30, 2009 was $6,733 on decreased borrowings
compared to $96,106 of interest expense in the same six months period of
2008.  In the six month period ending June 30, 2009 we recognized
non-cash amortization expense for warrants issued amounting to $889,967 compared
to $1,517,826 in the same six month period of 2008. The decrease was due to
conversion of debt to common stock as a result of the Master Restructuring
Agreement signed on August 4, 2008.




5




Net
loss




Net loss
for the six months ended June 30, 2009 was $(4,551,885) compared to a net loss
for the same six month period in 2008 of $(3,034,415).




Net
Loss Attributable to Common Stockholders




Net loss
attributable to common stockholders for this period of 2009 was $(4,551,885) or
$(0.01) cents per share (basic and diluted), compared to a net loss of
$(3,244,415) or $(0.07) cents per share (basic and diluted) for the same period
in 2008.




During
the six months ended June 30, 2008, the Company accrued $210,000 in dividends
with an interest rate of 6% on $7,000,000, the total value received for both
series A and B preferred stock. On August 4, 2008, all accrued dividends were
settled for the issuance of 42,960,480 shares of common stock.





Financial
Condition





Liquidity and Capital
Resources





The
Company’s cash on hand and working capital as of June 30, 2009 and December 31,
2008 are as follows:




June
      30,
                    
                    
                    December
      31,2009
                    
                    
                    2008Cash
      on hand
                    
                    $
                    166,191
                    
                    
                    $
                    1,922,401Working
      capital
                    
                    $
                    (626,587
                    )
                    
                    $
                    626,293




The
Company has purchased $23,309 in new fixed assets in the first six months of
2009. Under current conditions the Company anticipates purchasing approximately
$10,000 in additional fixed assets in 2009.





Net cash
used in operating activities totaled $1,732,901 for the six months ended June
30, 2009





Our
accounts receivable balance may have dramatic swings from one period to
another depending upon the timing and the amount of milestone billings
included in the balance at the end of any accounting period. There are
three milestone billings representing a percentage of the contract value
for each installment and our payment terms are ``upon receipt''. Receivable
balances are typically paid within 15 days of the invoice date. Billings
for maintenance contracts and consumables are due within 45 days and are
more numerous but much smaller in value than milestone billings. We review
our outstanding receivable balances on a regular basis to ensure that the
allowance for bad debt is adequate.   Due to the varying nature in the
timing and amounts of the receivable balances as noted above, the change in
the allowance for doubtful account will not necessarily correlate with the
increase or decrease in the accounts receivable balance. The accounts receivable
balance as of June 30, 2009 was $154,579 net of an allowance of $23,081, a
decrease of $21,705 from year end.





Our
inventory balance may have dramatic swings from one period to another
depending upon the expected installation date of our MedClean systems and our
accounts payable balances can have similar swings depending on payment
terms and any volume purchases or discounts we may take advantage of from
time to time. During the six months ended June 30, 2009, the Company increased
its inventory on hand by $421,564 to $1,307,915. The increase is due to the
completion of the first containerized unit and component parts which has shipped
to the intended site but was not installed by June 30, 2009. The accounts
payable balance as of June 30, 2009 was $265,959.





To
supplement its cash resources, the Company has been pursuing a number of
alternative financing arrangements with various investment entities. We are
currently looking to secure additional working capital to provide the necessary
funds for us to execute our business plan through various sources, including
bank facilities, bridge loans and equity offerings. However, we continue to
incur significant operating losses and the resultant reduction of our cash
position.  We cannot assure that we will be able to obtain additional
funding, and the lack thereof would have a material adverse impact on our
business.  Moreover, any equity funding could be substantially
dilutive to existing stockholders. The aforementioned factors raise substantial
doubt about our ability to continue as a going concern. In the event the Company
is unable to continue as a going concern it may pursue a number of different
options, including, but not limited to, filing for protection under the federal
bankruptcy code.




6





Item
3. Quantitative and Qualitative Disclosures about Market Risk





Not
required





Item
4. Controls and Procedures





As of the
six month period ended June 30, 2009 covered by this report, the Company carried
out, under the supervision and with the participation of the Company's
management, including its Chief Executive Officer and Chief Financial Officer,
an evaluation of the effectiveness of the design and operation of the Company's
disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934). Based upon and as of the date of
that evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that the design and operation of these disclosure controls and
procedures are effective.





There has been no change in our internal control over
financial reporting that occurred during the last fiscal quarter that has
materially affected, or is reasonably likely to materially affect, our internal
control over financial reporting.











7


PART
II--OTHER INFORMATION





Item 1: Legal
Proceedings.





The Company has no pending legal
proceedings. From time to time, it may be involved in various claims, lawsuits
or disputes with third parties, and actions involving allegations of breach of
contract incidental to the normal business operations of MedClean’s
business.





Item
1A: Risk Factors.





There have been no material changes
from the risk factors previously disclosed in the Company’s Annual Report on
Form 10-K for the fiscal year ended December 31, 2008.





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





There
were no unregistered sales of the Company’s equity securities during the quarter
ended June 30, 2009.





Item
3. Defaults upon Senior Securities.





There has been no default in the
payment of principal, interest, sinking or purchase fund installment, or any
other material default not cured within 30 days, with respect to any
indebtedness of the Company exceeding 5 percent of its total
assets.





Item
4. Submission of Matters to a Vote of Security Holders.





On May 15, 2009 the Company distributed
to its security holders an Information Statement on Schedule 14C regarding an
amendment to the Company’s Certificate of  Incorporation to effectuate
a reverse stock split on the Company’s common stock in a ratio to be approved by
the board of directors of up to 200:1. Such amendment was approved by written
consent of a majority of the Company’s security holders.





No other
matters have been submitted to security holders of the Company during the period
covered by this report.





Item
5: Other Information





None




8





Item
6. Exhibits





NUMBER
              DESCRIPTION OF EXHIBIT31.1*
              Certification
      by the Principal Executive Officer of Registrant pursuant to Section 302
      of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule
      15d-14(a)).31.2*
              Certification
      by the Principal Financial Officer of Registrant pursuant to Section 302
      of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule
      15d-14(a)).32.1*
              Certification
      by the Chief Executive Officer pursuant to 18 U.S.C. 1350 as adopted
      pursuant to Section 906 of the Sarbanes-Oxley Act of
  2002.32.2*
              Certification
      by the Chief Financial Officer pursuant to 18 U.S.C. 1350 as adopted
      pursuant to Section 906 of the Sarbanes-Oxley Act of
  2002.





* Filed
herein.








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.





Registrant





MEDCLEAN
TECHNOLOGIES, INC.





Date:
      August 4, 2009
            Date:
      August 4, 2009By:
      /s/ Scott
      Grisanti
            By:
      /s/ Kevin T.
      DunphyScott
      Grisanti,
            Kevin
      T. DunphyPresident
      and
            Treasurer
      andChief
      Executive Officer
            and
      Chief Financial Officer(Principal
      Executive Officer)
            (Principal
      Financial and Accounting Officer)











9