##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2009
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE TRANSITION PERIOD FROM  TO
 Commission file number 333-145939
 CLEANTECH BIOFUELS, INC.
  Delaware
(State or other jurisdiction of incorporation or organization)
    
    33-0754902
(I.R.S. Employer Identification No.)7386 Pershing Ave., University City, Missouri
(Address of principal executive offices)
    
    63130
(Zip Code)
 (314) 802-8670
 Yes þ No o
 Yes o No o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 Yes o No þ




---



##### 



CLEANTECH BIOFUELS, INC.
TABLE OF CONTENTS
 PAGEPART I Financial InformationItem 1 Financial Statements (Unaudited)
    
    
    3Balance Sheets  June 30, 2009 and December 31, 2008
    
    
    3Statements of Operations  Three months and six months ended June 30, 2009 and 2008 and Inception to June 30, 2009
    
    
    4Statements of Stockholders Equity (Deficit)  June 30, 2009
    
    
    5Statements of Cash Flows  Six months ended June 30, 2009 and 2008 and Inception to June 30, 2009
    
    
    6  7Notes to Financial Statements
    
    
    8  16Item 2 Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    16Item 3 Quantitative and Qualitative Disclosures About Market Risk
    
    
    25Item 4T Controls and Procedures
    
    
    26PART II Other InformationItem 1 Legal Proceedings
    
    
    26Item 1A Risk Factors
    
    
    27Item 2 Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    27Item 3 Defaults upon Senior Securities
    
    
    27Item 4 Submission of Matters to a Vote of Security Holders
    
    
    27Item 5 Other Information
    
    
    27Item 6 Exhibits
    
    
    28Signatures
    
    
    29Index to Exhibits
    
    
    30Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   2




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements (Unaudited)
 CLEANTECH BIOFUELS, INC.
(formerly Alternative Ethanol Technologies, Inc.)
(A Development Stage Company)
 
 BALANCE SHEETS
 June 30,
    
    
    December 31,2009
    
    
    2008(unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    102,540
    
    
    $
    96,617Prepaids and other current assets
    
    
    23,372
    
    
    
    68,345125,912
    
    
    
    164,962Property and equipment, net
    
    
    32,714
    
    
    
    18,826Non-current assets:Technology licenses, net
    
    
    2,021,782
    
    
    
    2,021,782Patents
    
    
    600,000
    
    
    
    600,000Total Assets
    
    $
    2,780,408
    
    
    $
    2,805,570LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)Current liabilities:Accounts payable
    
    $
    244,896
    
    
    $
    238,925Accrued interest
    
    
    63,426
    
    
    
    26,660Accrued professional fees and other
    
    
    109,913
    
    
    
    66,250Notes Payable, net
    
    
    1,089,208
    
    
    
    456,712Series A Convertible Debentures
    
    
    140,000
    
    
    
    Deferred revenue
    
    
    50,000
    
    
    
    Capital lease
    
    
    4,758
    
    
    
    4,649Total current liabilities
    
    
    1,702,201
    
    
    
    793,196Capital Lease
    
    
    3,707
    
    
    
    6,117Series A Convertible Debentures
    
    
    
    
    
    
    140,000STOCKHOLDERS EQUITY (DEFICIT)Preferred stock, $0.001 par value; 10,000,000 authorized shares; no shares
issued or outstanding
    
    
    
    
    
    
    Common stock, $0.001 par value; 240,000,000 authorized shares;
61,704,753 and 61,270,153 shares issued and outstanding at
June 30, 2009 and December 31, 2008, respectively
    
    
    61,705
    
    
    
    61,270Additional paid-in capital
    
    
    5,104,700
    
    
    
    4,675,098Notes receivable  restricted common shares issued to Directors and Employees
    
    
    (167,074
    )
    
    
    (162,567
    )Deficit accumulated during the development stage
    
    
    (3,924,831
    )
    
    
    (2,707,544
    )Total Stockholders Equity
    
    
    1,074,500
    
    
    
    1,866,257Total Liabilities and Stockholders Equity
    
    $
    2,780,408
    
    
    $
    2,805,570
 See accompanying notes to financial statements.
  3




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##### Table of Contents



CLEANTECH BIOFUELS, INC.
(formerly Alternative Ethanol Technologies, Inc.)
(A Development Stage Company)
 
 STATEMENTS OF OPERATIONS (unaudited)
 July 14, 2004Three months ended
    
    
    Six months ended
    
    
    (inception) toJune 30,
    
    
    June 30,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2009General and administrative
    
    $
    345,004
    
    
    $
    155,107
    
    
    $
    588,827
    
    
    $
    301,330
    
    
    $
    1,656,577Professional fees
    
    
    83,161
    
    
    
    78,946
    
    
    
    192,574
    
    
    
    190,892
    
    
    
    952,015Research and development
    
    
    
    
    
    
    53,812
    
    
    
    101
    
    
    
    236,916
    
    
    
    524,802Operating Loss
    
    
    428,165
    
    
    
    287,865
    
    
    
    781,502
    
    
    
    729,138
    
    
    
    3,133,394Other expense (income):Interest expense
    
    
    246,165
    
    
    
    4,136
    
    
    
    472,292
    
    
    
    23,887
    
    
    
    718,750Amortization of technology license
    
    
    
    
    
    
    3,750
    
    
    
    
    
    
    
    7,500
    
    
    
    35,000Deposit forfeiture
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (25,000
    )Other income
    
    
    (27,333
    )
    
    
    
    
    
    
    (32,000
    )
    
    
    
    
    
    
    (32,000
    )Interest income
    
    
    (2,266
    )
    
    
    (252
    )
    
    
    (4,507
    )
    
    
    (5,979
    )
    
    
    (39,661
    )216,566
    
    
    
    7,634
    
    
    
    435,785
    
    
    
    25,408
    
    
    
    657,089Net loss applicable to common stockholders
    
    $
    644,731
    
    
    $
    295,499
    
    
    $
    1,217,287
    
    
    $
    754,546
    
    
    $
    3,790,483Basic and diluted net loss per common share
    
    $
    0.01
    
    
    $
    0.01
    
    
    $
    0.02
    
    
    $
    0.01
    
    
    $
    0.08Weighted average common shares outstanding
    
    
    61,600,586
    
    
    
    57,489,950
    
    
    
    61,476,070
    
    
    
    53,786,237
    
    
    
    45,884,839
 See accompanying notes to financial statements.
  4




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CLEANTECH BIOFUELS, INC.
(formerly Alternative Ethanol Technologies, Inc.)
(A Development Stage Company)
 
 STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY (DEFICIT) (unaudited)
 Notes Rec -restrictedcommon
    
    
    July 14, 2004Additional
    
    
    shares issued
    
    
    (inception) toCommon Stock
    
    
    Paid-in
    
    
    to Directors
    
    
    June 30,Shares
    
    
    Amount
    
    
    Capital
    
    
    and Employees
    
    
    2009Balances at December 31, 2008
    
    
    61,270,153
    
    
    $
    61,270
    
    
    $
    4,675,098
    
    
    $
    (162,567
    )
    
    $
    (2,707,544
    )Conversion of convertible note in February 2009 at $.25 per share
    
    
    122,100
    
    
    
    122
    
    
    
    11,533Conversion of convertible note in May 2009 at $.08 per share
    
    
    312,500
    
    
    
    313
    
    
    
    24,687Discounts on Notes Payable
    
    
    
    
    
    
    
    
    
    
    164,071Interest on Notes Receivable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,507
    )Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    229,311Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,217,287
    )Balances at June 30, 2009
    
    
    61,704,753
    
    
    $
    61,705
    
    
    $
    5,104,700
    
    
    $
    (167,074
    )
    
    $
    (3,924,831
    )
 See accompanying notes to financial statements.
  5




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CLEANTECH BIOFUELS, INC.
(formerly Alternative Ethanol Technologies, Inc.)
(A Development Stage Company)
 
 STATEMENTS OF CASH FLOWS (Unaudited)
 July 14, 2004Six months ended
    
    
    (inception) toJune 30,
    
    
    June 30,2009
    
    
    2008
    
    
    2009Operating ActivitiesNet loss applicable to common stockholders
    
    $
    (1,217,287
    )
    
    $
    (754,546
    )
    
    $
    (3,790,483
    )Adjustments to reconcile net loss applicable to common
stockholders to net cash used by operating activities:Items that did not use (provide) cash:Common stock issued for organizational costs
    
    
    
    
    
    
    
    
    
    
    100Depreciation
    
    
    6,814
    
    
    
    12,796
    
    
    
    35,642Amortization
    
    
    
    
    
    
    7,500
    
    
    
    35,000Interest income
    
    
    (4,507
    )
    
    
    
    
    
    
    (12,274
    )Amortization of discounts (interest expense) and other financing charges
    
    
    432,311
    
    
    
    
    
    
    
    571,262Share-based compensation expense
    
    
    229,311
    
    
    
    134,360
    
    
    
    487,432Write-off of technology license
    
    
    
    
    
    
    
    
    
    
    97,500Fair value of RAM warrant settlement
    
    
    
    
    
    
    
    
    
    
    125,027Changes in operating assets and liabilities that provided
(used) cash, net:Prepaids and other current assets
    
    
    44,973
    
    
    
    22,461
    
    
    
    (23,372
    )Technology license
    
    
    
    
    
    
    
    
    
    
    (132,500
    )Accounts payable
    
    
    5,971
    
    
    
    35,329
    
    
    
    244,896Other assets and other liabilities
    
    
    87,514
    
    
    
    17,719
    
    
    
    163,045Accrued liabilities
    
    
    43,663
    
    
    
    
    
    
    
    109,913Net cash used by operating activities
    
    
    (371,237
    )
    
    
    (524,381
    )
    
    
    (2,088,812
    )Cash Flows Provided (Used) by Investing ActivitiesAcquisition of patent, net
    
    
    
    
    
    
    
    
    
    
    (150,000
    )Merger of Biomass North America Licensing, Inc., net
    
    
    
    
    
    
    
    
    
    
    (20,000
    )Acquisition of HFTA technology, net
    
    
    
    
    
    
    
    
    
    
    Expenditures for equipment
    
    
    (20,702
    )
    
    
    (26,679
    )
    
    
    (54,237
    )Net cash used by investing activities
    
    
    (20,702
    )
    
    
    (26,679
    )
    
    
    (224,237
    )Cash Flows Provided (Used) by Financing ActivitiesAdvances  related parties
    
    
    
    
    
    
    
    
    
    
    Payments on capital lease, including interest
    
    
    (2,524
    )
    
    
    (1,104
    )
    
    
    (6,311
    )Series A Convertible Debentures, including interest
    
    
    
    
    
    
    474,900
    
    
    
    1,424,900Issuance of Convertible Notes Payable
    
    
    445,000
    
    
    
    
    
    
    
    1,052,000Payments on Note Payable
    
    
    (44,614
    )
    
    
    
    
    
    
    (80,000
    )Sale of common stock
    
    
    
    
    
    
    
    
    
    
    25,000Net cash provided by financing activities
    
    
    397,862
    
    
    
    473,796
    
    
    
    2,415,589Net increase (decrease) in cash and cash equivalents
    
    
    5,923
    
    
    
    (77,264
    )
    
    
    102,540Cash and cash equivalents at beginning of period
    
    
    96,617
    
    
    
    120,356
    
    
    
    Cash and cash equivalents at end of period
    
    $
    102,540
    
    
    $
    43,092
    
    
    $
    102,540
  6




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CLEANTECH BIOFUELS, INC.
(formerly Alternative Ethanol Technologies, Inc.)
(A Development Stage Company)
 STATEMENTS OF CASH FLOWS contd (unaudited)
 July 14, 2004Six months ended
    
    
    (inception) toJune 30,
    
    
    June 30,2009
    
    
    2008
    
    
    2009Supplemental disclosure of cash flow information:Cash paid for interest
    
    $
    2,691
    
    
    $
    694
    
    
    $
    9,901Supplemental disclosure of noncash investing and
financing activities:Promissory notes receivable related to Series A Convertible Debentures
    
    
    
    
    
    $
    
    
    
    $
    450,000Capital lease related to the purchase of equipment
    
    
    
    
    
    $
    14,119
    
    
    $
    14,119Common stock issued for organizational costs
    
    
    
    
    
    $
    
    
    
    $
    100Common stock issued for promissory notes
    
    
    
    
    
    $
    
    
    
    $
    133,596Common stock issued for Convertible notes converted
    
    $
    36,655
    

    
    $
    
    
    
    $
    36,655Common stock issued for Debentures converted
    
    
    
    
    
    $
    1,333,337
    
    
    $
    1,333,337Common stock and note payable issued for acquistion of Biomass
    
    
    
    
    
    $
    
    
    
    $
    1,501,250Common stock issued for HFTA
    
    
    
    
    
    $
    
    
    
    $
    500,532
 See accompanying notes to financial statements.
  7




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##### Table of Contents



Note 1  Organization and Business
      Note 2  Interim Financial Statements
  Note 3  Mergers/Acquisitions
   8




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##### Table of Contents



Note 4  Patent
  Note 5  Technology Licenses
 Biomass North America Licensing, Inc.
   HFTA, Inc.
   9




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##### Table of Contents



Bio-Products International, Inc.
    10




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##### Table of Contents



Brelsford Engineering, Inc.
   Note 6  Debt
 June 30,
    
    
    December 31,2009
    
    
    2008Convertible Notes Payable, net of discounts of $228,628 and $514,797
at June 30, 2009 and December 31, 2008, respectively, which are
made up of various individual notes with an aggregate face value
of
$612,000 and $607,000 at June 30, 2009 and December 31, 2008,
respectively, due in one year from date of note, interest at 6.0%
    
    $
    383,372
    
    
    $
    92,203Convertible Notes Payable, net of discounts of $115,064 and $-0- at June 30,
2009 and December 31, 2008, respectively, which are made up of
various individual notes with an aggregate face value of $385,000
and $-0- at June 30, 2009 and December 31, 2008, respectively,
due
in one year from date of note, interest at 6.0%
    
    
    269,936
    
    
    
    WWT Note Payable, net of discount of $14,100 and $130,105 at
June 30, 2009 and December 31, 2008, respectively, with a face
value of $450,000, due July 22, 2009, interest at 6.0%
    
    
    435,900
    
    
    
    319,895Note Payable, repaid May 1, 2009, interest at 6.0%
    
    
    
    
    
    
    44,614Series A Convertible Debentures, due April 16, 2010, interest at 6.0%
    
    
    140,000
    
    
    
    140,000Total debt
    
    
    1,229,208
    
    
    
    596,712Current maturities
    
    
    (1,229,208
    )
    
    
    (456,712
    )Long-term portion, less current maturities
    
    $
    
    
    
    $
    140,000
 Convertible Notes Payable
   11




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WWT Note Payable
  Series A Convertible Debentures
    Note 7  Stockholders Deficit
    12




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Net Loss per Common Share
 Note 8  Related Party Transactions
    Note 9  Share-based Payments
    13




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For the years ended December 31,2008
    
    
    2007Risk-free interest rate
    
    
    1.57
    %
    
    
    4.25
    %Dividend yield
    
    
    0
    %
    
    
    0
    %Volatility
    
    
    36.91
    %
    
    
    61.49
    %Expected term
    
    
    4.8
    
    
    
    5.0Fair market value
    
    $
    0.12
    
    
    $
    0.08
   14




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Three months ended
    
    
    Six months endedJune 30, 2009
    
    
    June 30, 2008
    
    
    June 30, 2009
    
    
    June 30, 2008Pre-tax compensation expense:Stock options
    
    $
    146,019
    
    
    $
    51,680
    
    
    $
    229,311
    
    
    $
    134,361Warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total expense
    
    
    146,019
    
    
    
    51,680
    
    
    
    229,311
    
    
    
    134,361Tax benefit, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    After-tax compensation expense
    
    $
    146,019
    
    
    $
    51,680
    
    
    $
    229,311
    
    
    $
    134,361
   WeightedShares Under
    
    
    Average
    
    
    AggregateOption
    
    
    Exercise Price
    
    
    intrinsic valueOptions outstanding at December 31, 2008
    
    
    6,510,000
    
    
    $
    0.20
    
    
    
    (1
    )Granted
    
    
    Exercised
    
    
    Forfeited
    
    
    Options outstanding at June 30, 2009
    
    
    6,510,000
    
    
    $
    0.20
    
    
    
    (1
    )Options exercisable at June 30, 2009
    
    
    1,421,665
    
    
    $
    0.17
    
    
    
    (1
    )
 (1)
    
    The weighted-average exercise price at December 31, 2008 and June 30, 2009 for all outstanding
and exercisable options was greater than the fair value of the Companys common stock on that
date, resulting in an aggregate intrinsic value of $-0-. Note 10  Commitments and Contingencies
 Project management
 Duluth Litigation
  15




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Leases 
 Note 11  Subsequent Events
   
 Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
 Statement Regarding Forward-Looking Information
   
    
    the commercial viability of our technologies,
    
    our ability to maintain and enforce our exclusive rights to our technologies,
    
    our ability to raise additional capital on favorable terms to continue developing
our technologies;
    
    the demand for and production costs of various energy products made from our
biomass,
    
    competition from other alternative energy technologies, and
    
    other risks and uncertainties detailed from time to time in our filings with the
SEC.
  16




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##### Table of Contents



Company Overview
   
    
    a pressurized steam classification technology, which we refer to as the PSC
technology, invented at the University of Alabama, Huntsville that used a pressurized steam
classification vessel to convert MSW into cellulosic material while simultaneously
segregating and eliminating any inorganic materials in the solid waste and cleaning
recyclable materials in the MSW;
 
    
    a sulfuric acid hydrolysis process, which we refer to as the Brelsford technology,
developed by Brelsford Engineering, Inc. that employs an acid hydrolysis process to convert
cellulosic material into fermentable sugars, which can then be fermented into ethanol, and;
 
    
    a nitric acid hydrolysis process, which we refer to as our HFTA technology, developed
by scientists working at the University of California, Berkeley, that incorporates
anticipated improvements in chemical reaction by which acid hydrolysis occurs.
     17




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Recent Developments
    18




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##### Table of Contents



Plan of Operation
     19




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##### Table of Contents



Biomass Feedstock Production
    Diesel Fuel Production.
  New Technologies; Commercializing Existing Technologies
   20




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##### Table of Contents




    
    construct and operate a commercial plant that processes MSW into cellulosic
biomass for combustion in existing co-fired boilers for power;
 
    
    identify and partner with landfill owners, waste haulers and municipalities to
identify locations suitable for our technology; and
 
    
    pursue additional opportunities to implement our technology in commercial
settings at transfer stations and landfills in the United States and elsewhere in the
world.
  Results of Operations
  Three months endedJune 30, 2009
    
    
    June 30, 2008
    
    
    ChangeGeneral and administrative
    
    $
    345,004
    
    
    $
    155,107
    
    
    $
    189,897Professional fees
    
    
    83,161
    
    
    
    78,946
    
    
    
    4,215Research and development
    
    
    
    
    
    
    53,812
    
    
    
    (53,812
    )Operating loss
    
    
    428,165
    
    
    
    287,865
    
    
    
    140,300Other expense (income):Interest expense
    
    
    246,165
    
    
    
    4,136
    
    
    
    242,029Amortization of technology license
    
    
    
    
    
    
    3,750
    
    
    
    (3,750
    )Other income
    
    
    (27,333
    )
    
    
    
    
    
    
    (27,333
    )Interest income
    
    
    (2,266
    )
    
    
    (252
    )
    
    
    (2,014
    )Net loss applicable to common stockholders
    
    $
    644,731
    
    
    $
    295,499
    
    
    $
    349,232
 General and administrative
 Research and Development
 Interest expense
 Amortization
 Other income
  21




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Interest income
 Six months endedJune 30, 2009
    
    
    June 30, 2008
    
    
    ChangeGeneral and administrative
    
    $
    588,827
    
    
    $
    301,330
    
    
    $
    287,497Professional fees
    
    
    192,574
    
    
    
    190,892
    
    
    
    1,682Research and development
    
    
    101
    
    
    
    236,916
    
    
    
    (236,815
    )Operating loss
    
    
    781,502
    
    
    
    729,138
    
    
    
    52,364Other expense (income):Interest expense
    
    
    472,292
    
    
    
    23,887
    
    
    
    448,405Amortization of technology license
    
    
    
    
    
    
    7,500
    
    
    
    (7,500
    )Other income
    
    
    (32,000
    )
    
    
    
    
    
    
    (32,000
    )Interest income
    
    
    (4,507
    )
    
    
    (5,979
    )
    
    
    1,472Net loss applicable to common stockholders
    
    $
    1,217,287
    
    
    $
    754,546
    
    
    $
    462,741
 General and administrative
 Research and Development
 Interest expense
 Amortization
 Other income
 Interest income
 Liquidity and Capital Resources
    22




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##### Table of Contents



Debt
 Convertible Notes Payable
   WWT Note Payable
   23




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##### Table of Contents



Series A Convertible Debentures
   Summary of Cash Flow Activity
 Six Months Ended June 30,2009
    
    
    2008Net cash used by operating activities
    
    $
    (371,237
    )
    
    $
    (524,381
    )Net cash used by investing activities
    
    
    (20,702
    )
    
    
    (26,679
    )Net cash provided by financing activities
    
    
    397,862
    
    
    
    473,796
 Net cash used by operating activities
  Net cash used by investing activities
  Net cash provided by financing activities
   24




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##### Table of Contents



Contractual Obligations and Commitments
  Payments due by PeriodLess than 1
    
    
    
    
    
    
    
    
    
    
    More than 5Total
    
    
    year
    
    
    1 to 3 years
    
    
    4 to 5 years
    
    
    yearsConvertible Notes (1)
    
    $
    1,083,320
    
    
    $
    1,083,320
    
    
    $
    
    
    
    $
    
    
    
    $
    WWT Note (2)
    
    
    470,250
    
    
    
    470,250
    
    
    
    
    
    
    
    
    
    
    
    Series A Convertible Debentures (3)
    
    
    140,000
    
    
    
    140,000
    
    
    
    
    
    
    
    
    
    
    
    Capital Lease (4)
    
    
    9,450
    
    
    
    5,400
    
    
    
    4,050
    
    
    
    
    
    
    
    Operating Lease (5)
    
    
    32,400
    
    
    
    21,600
    
    
    
    10,800
    
    
    
    
    
    
    
    Total contractual obligations
    
    $
    1,735,420
    
    
    $
    1,720,570
    
    
    $
    14,850
    
    
    $
    
    
    
    $
    
 (1)
    
    Amount represents value of principal amount of notes and estimates for interest. These
notes are with various
individuals, carry one-year terms and are convertible into shares of Common Stock at the
noteholders option. The first of
these notes are due October 1, 2009. If the noteholders do not convert their notes into shares of
Common Stock, the notes
will have to be repaid or refinanced.(2)
    
    Amount represents value of principal amount of note and interest through term of note.(3)
    
    Debentures are convertible at Companys option into shares of the Companys common stock.(4)
    
    Represents lease on office furniture.(5)
    
    Represents lease for office space. The lease is for three years from occupancy date of January
2008.  Merrick & Company.
 Off-Balance Sheet Arrangements
  Critical Accounting Policies
   
 Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
   25




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##### Table of Contents



Item 4T.
    
    Controls and Procedures
 Effectiveness of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
 
 PART II. OTHER INFORMATION
 
 Item 1.
    
    Legal Proceedings
 Duluth Venture Capital Partners, L.L.C. v. Cleantech Biofuels, Inc., et al.
    Selling Stockholder
    
    Shares SuspendedBrite Star Associates, Inc.
    
    
    1,777,867Fountain Consulting, Inc.
    
    
    1,482,000St Ives Consulting, Inc.
    
    
    1,368,000Trinity Enterprises, L.L.C.
    
    
    1,966,667Padstow Estates, Inc.
    
    
    1,966,667
  26




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##### Table of Contents



Ram Resources, L.L.C. v. CleanTech Biofuels, Inc.
 
 Item 1A.
    
    Risk Factors
  
 Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3.
    
    Defaults Upon Senior Securities None.
 
 Item 4.
    
    Submission of Matters to a Vote of Security Holders None.
 
 Item 5.
    
    Other Information None.
  27




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##### Table of Contents



Item 6.
    
    Exhibits
  EXHIBIT NO.
    
    DESCRIPTION31.1
    
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the
Securities Exchange Act, as amended.31.2
    
    
    Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of
the Securities Exchange Act, as amended.32.1
    
    
    Certification (Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002) of Chief Executive Officer.32.2
    
    
    Certification (Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002) of Principal Financial Officer.
  28




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##### Table of Contents



SIGNATURES
  CLEANTECH BIOFUELS, INC.Date: August 13, 2009
    /s/ Edward P. Hennessey, Jr.Edward P. Hennessey, Jr.Chief Executive OfficerDate: August 13, 2009
    /s/ Thomas JenneweinThomas JenneweinChief Financial Officer and
Principal Accounting Officer  29




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##### Table of Contents



INDEX TO EXHIBITS
 EXHIBIT NO.
    
    DESCRIPTION31.1
    
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the
Securities Exchange Act, as amended.31.2
    
    
    Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of
the Securities Exchange Act, as amended.32.1
    
    
    Certification (Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002) of Chief Executive Officer.32.2
    
    
    Certification (Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002) of Principal Financial Officer.
  30