Clean Energy Technologies, Inc. (CETY) - Form 8-K Summary
Business Context and Reporting Period
This Current Report on Form 8-K, dated August 10, 2026, details a material definitive agreement entered into by Clean Energy Technologies, Inc. The Company, headquartered in Irvine, CA, reported the execution of a securities purchase agreement with Pacific Pier Capital II, LP.
Key Financial Metrics and Transaction Details
- Instrument: Convertible promissory note.
- Principal Amount: $178,410.
- Purchase Price: $150,000.80.
- Net Proceeds: $143,000.80 (after deducting $7,000 in legal expenses paid from gross proceeds).
- Interest Rate: 12% per annum.
- Maturity Date: August 7, 2027 (12 months from issue date).
- Conversion Terms: Convertible at the holder's election after six months at 85% of the lowest daily VWAP during the 10 trading days prior to conversion.
- Ownership Limit: Beneficial ownership capped at 4.99% of outstanding common stock.
Material Changes and Covenants
The filing discloses the creation of a direct financial obligation and the unregistered sale of equity securities. Key covenants include:
- Use of Proceeds: Restricted to business development and payment of service providers. Explicitly prohibited for repayment of indebtedness to officers, directors, or employees, or for other corporate finance transactions.
- Exchange Cap: Issuance of more than 2,000,000 shares to the investor is prohibited until shareholder approval is obtained.
- Shareholder Approval Deadline: The Company must obtain shareholder approval for issuances exceeding the Exchange Cap by November 7, 2026, to comply with Nasdaq Listing Rule 5635.
Outlook, Risks, and Contingencies
The transaction was funded and closed on April 22, 2026, though the report was filed on August 10, 2026. The Note was sold in reliance on the Section 4(a)(2) exemption from registration. A primary contingency is the requirement to secure shareholder approval by November 7, 2026, to allow for the conversion of the note beyond the 2,000,000 share limit. Failure to obtain this approval may restrict the investor's ability to convert the full principal amount into equity.
Investor Verification Checklist
- Verify the Company's ability to secure shareholder approval by the November 7, 2026 deadline.
- Review the full text of the Securities Purchase Agreement (Exhibit 10.1) and Promissory Note (Exhibit 10.2) for additional covenants.
- Confirm the Company's current cash position and liquidity needs given the 12% interest obligation.
- Monitor the Company's stock price volatility, as the conversion price is based on the lowest VWAP, which could lead to significant dilution.