UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

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

FOR THE QUARTERLY PERIOD ENDED: September 30, ~~2017~~2023

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

For the transition period from __________ to __________

Commission File Number: ~~________________~~333-147980

ORIGINCLEAR, INC.

(Exact name of registrant as specified in its charter)

Nevada		26-0287664
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

~~525 S. Hewitt St.~~13575 58th Street North

~~Los Angeles, CA 90013~~Suite 200

Clearwater, FL 33760

(Address of principal executive offices, Zip Code)

~~(323) 939-6645~~(727) 440-4603

(Registrant’s telephone number, including area code)

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

Title of each class		Ticker symbol(s)		Name of each exchange on which registered
N/A		N/A		N/A

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

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ☒ No ☐

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

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐☒	Smaller reporting company	☒
			Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

~~Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.~~ As of ~~November 14, 2017,~~December 7, 2023, there were ~~99,756,011~~1,398,703,066 shares of common stock, par value $0.0001 per share, issued and outstanding.

TABLE OF CONTENTS

		Page

PART I

Item 1.	Financial Statements.	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	1633
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	2348
Item 4.	Controls and Procedures.	2448

PART II

Item 1.	Legal Proceedings.	2549
Item 1A.	Risk Factors.	2549
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	2549
Item 3.	Defaults Upon Senior Securities.	2549
Item 4.	Mine Safety Disclosures.	2549
Item 5.	Other Information.	2549
Item 6.	Exhibits.	2549
		50
SIGNATURES			26

PART I - FINANCIAL INFORMATION

This Quarterly Report includes forward-looking statements within the meaning of the Securities Exchange Act of 1934 (the “Exchange Act”). These statements are based on management’s beliefs and assumptions, and on information currently available to management. Forward-looking statements include the information concerning our possible or assumed future results of operations set forth under the heading “Management’s Discussion and Analysis of Financial Condition or Plan of Operation.” Forward-looking statements also include statements in which words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “consider” or similar expressions are used.

Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. Our future results and shareholder values may differ materially from those expressed in these forward-looking statements. Readers are cautioned not to put undue reliance on any forward-looking statements.

~~Item 1. Financial Statements.~~

ORIGINCLEAR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30, 2017 December 31, 2016
(Unaudited)
ASSETS

CURRENT ASSETS
Cash $ 342,164 $ 351,321
Contracts receivable, less allowance for doubtful accounts of $50,000 and $50,000 respectively 523,548 382,895
Inventory 13,614 -
Cost in excess of billing 9,238 47,612
Work in progress 84,157 86,085
Prepaid expenses 17,991 42,128

TOTAL CURRENT ASSETS 990,712 910,041

NET PROPERTY AND EQUIPMENT 156,252 161,912

OTHER ASSETS
Other asset 19,538 19,538
Goodwill 682,145 682,145
Trademark 4,467 4,467
Security deposit 3,500 3,500
TOTAL OTHER ASSETS 709,650 709,650
TOTAL ASSETS $ 1,856,614 $ 1,781,603

LIABILITIES AND SHAREHOLDERS’ DEFICIT

Current Liabilities
Accounts payable and other payable $ 830,539 $ 480,064
Accrued expenses 847,114 715,281
Billing in excess of cost 233,394 -
Customer deposit 113,950 113,950
Warranty reserve 20,000 20,000
Loans payable, current portion 11,090 -
Derivative liabilities 10,728,464 8,702,083
Convertible promissory notes, net of discount of $54,440 and $591,835, respectively 296,722 1,935,233
Total Current Liabilities 13,081,273 11,966,611

Long Term Liabilities
Loan payable, long term portion 12,282 -
Convertible promissory notes, net of discount of $235,268 and $11,429, respectively 3,080,628 1,613,571
Total Long Term Liabilities 3,092,910 1,613,571
Total Liabilities 16,174,183 13,580,182

SHAREHOLDERS’ DEFICIT
Preferred stock, $0.0001 par value, 25,000,000 shares authorized 6,666 shares of Series B issued and outstanding, respectively 1 1
1,000 shares of Series C issued and outstanding, respectively - -
Common stock, $0.0001 par value, 300,000,000 shares authorized 78,151,781 and 21,428,454 equity shares issued and outstanding, respectively 7,815 2,143
Preferred treasury stock, 1,000 and 1,000 shares of Series C outstanding, respectively - -
Additional paid in capital 57,564,158 51,428,976
Accumulated other comprehensive loss (134 ) (92 )
Accumulated deficit (71,889,409 ) (63,229,607 )
TOTAL SHAREHOLDERS’ DEFICIT (14,317,569 ) (11,798,579 )
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT $ 1,856,614 $ 1,781,603

	September 30, 2023			December 31, 2022
		(Unaudited)
ASSETS

CURRENT ASSETS
Cash	$	1,153,181		$	1,354,814
Contracts receivable, net allowance of $0 and $17,315, respectively		1,478,505			2,479,123
Fair value investment in securities		22,604			27,125
Contract assets		908,327			1,479,491
Prepaid expenses		10,175			25,000

TOTAL CURRENT ASSETS		3,572,792			5,365,553

NET PROPERTY AND EQUIPMENT		154,058			177,069

OTHER ASSETS
Long term assets held for sale		-			400,000
Note receivable on sale of asset		132,000			-
SPAC Class B common shares purchase cost		400,000			400,000
Fair value investment-securities		3,200			2,400
Trademark		4,467			4,467

TOTAL OTHER ASSETS		539,667			806,867

TOTAL ASSETS	$	4,266,517		$	6,349,489


LIABILITIES AND SHAREHOLDERS’ DEFICIT

Current Liabilities
Accounts payable and other payable	$	1,601,904		$	3,784,747
Accrued expenses		2,349,803			1,633,904
Cumulative preferred stock dividends payable		436,456			415,597
Contract liabilities		1,271,095			932,458
Tax liability 83(b)		13,600			15,600
Customer deposit		146,453			146,453
Warranty reserve		20,000			20,000
Line of credit		139,879			-
Loan payable, merchant cash advance		30,646			30,646
Loans payable, SBA		147,871			149,790
Derivative liabilities		10,817,590			9,578,904
Series F 8% Preferred Stock, 60 and 60 shares issued and outstanding, respectively,
redeemable value of $60,000 and $60,000 respectively		60,000			60,000
Series G 8% Preferred Stock, 25 and 25 shares issued and outstanding, respectively,
redeemable value of $25,000 and $25,000, respectively		25,000			25,000
Series I 8% Preferred Stock, 25 and 25 shares issued and outstanding, respectively,
redeemable value of $25,000 and $25,000, respectively		25,000			25,000
Series K 8% Preferred Stock, 307.15 and 407.15 shares issued and outstanding,
respectively, redeemable value of $307,150 and $407,150, respectively		307,150			407,150
Convertible secured promissory note (Note 5)		15,772,089			1,347,500
Convertible promissory notes, net of discount of $0 and $0, respectively (Note 5)		2,472,945			1,037,983

Total Current Liabilities		35,637,481			19,610,732

Long Term Liabilities
Convertible promissory notes, net of discount of $0 and $0, respectively		144,747			1,888,772

Total Long Term Liabilities		144,747			1,888,772

Total Liabilities		35,782,228			21,499,504


COMMITMENTS AND CONTINGENCIES (See Note 13)

Series J Convertible Preferred Stock, 210 and 210 shares issued and outstanding, respectively, redeemable value of $210,000 and $210,000, respectively		210,000			210,000
Series L Convertible Preferred Stock, 320,495 and 320,495 shares issued and outstanding, respectively redeemable value of $320,495 and $320,495, respectively		320,495			320,495
Series M Preferred Stock, 40,300 and 40,300 shares issued and outstanding, respectively, redeemable value of $1,007,500 and $1,007,500, respectively		1,007,500			1,007,500
Series O 8% Convertible Preferred Stock, 190 and 230 shares issued and outstanding, respectively, redeemable value of $190,000 and $230,000, respectively		190,000			230,000
Series P Convertible Preferred Stock, 30 and 30 shares issued and outstanding, respectively redeemable value of $30,000 and $30,000, respectively		30,000			30,000
Series Q 12% Convertible Preferred Stock, 420 and 615 shares issued and outstanding, respectively, redeemable value of $420,000 and $615,000, respectively		420,000			615,000
Series R 12% Convertible Preferred Stock, 1,808 and 2,828 shares issued and outstanding, respectively, redeemable value of $1,808,000 and $2,828,000, respectively		1,808,000			2,828,000
Series S 12% Convertible Preferred Stock, 120 and 170 shares issued and outstanding, respectively, redeemable value of $120,000 and $170,000, respectively		120,000			170,000
Series U Convertible Preferred Stock, 270 and 385 shares issued and outstanding, respectively, redeemable value of $270,000 and $385,000, respectively		270,000			385,000
Series W 12% Convertible Preferred Stock, 911.5 and 819.5 shares issued and outstanding, respectively, redeemable value of $911,500 and $819,500, respectively		911,500			819,500
Series X Convertible Preferred Stock, 0 and 250 shares issued and outstanding, respectively, redeemable value of $0 and $250,000, respectively		-			250,000
Series Y Convertible Preferred Stock, 24.58 and 37.51 shares issued and outstanding, respectively, redeemable value of $2,457,577and $3,751,277, respectively		2,457,577			3,751,277
Series Z Convertible Preferred Stock, 0 and 250 shares issued and outstanding, respectively, redeemable value of $0 and $250,000, respectively		-			250,000
		7,745,072			10,866,772

SHAREHOLDERS’ DEFICIT
Preferred stock, $0.0001 par value, 600,000,000 shares authorized 0 and 1,475 shares of Series A issued and outstanding, respectively		-			-
0 and 0 shares of Series B issued and outstanding, respectively		-			-
1,000 and 1,001,000 shares of Series C issued and outstanding, respectively		-			-
31,500,000 and 31,500,000 shares of Series D-1 issued and outstanding, respectively		3,150			3,150
Subscription payable for purchase of equipment		100,000			100,000
Preferred treasury stock, 1,000 and 1,000 shares outstanding, respectively		-			-
Common stock, $0.0001 par value, 19,000,000,000 shares authorized 1,318,066,996 and 1,013,369,185 equity shares issued and outstanding, respectively		131,808			101,337
Additional paid in capital - Common stock		87,651,798			82,745,503
Accumulated other comprehensive gain/(loss)		(132	)		(132	)
Accumulated deficit		(127,147,407	)		(108,966,645	)

TOTAL SHAREHOLDERS’ DEFICIT		(39,260,783	)		(26,016,787	)

TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT	$	4,266,517		$	6,349,489

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

ORIGINCLEAR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, ~~2017~~2023 AND ~~2016~~2022

(Unaudited)

Three Months Ended Nine Months Ended
September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016

Sales $ 1,112,438 $ 1,019,919 $ 2,294,891 $ 4,321,378

Cost of Goods Sold 949,657 574,105 2,031,334 2,899,507

Gross Profit 162,781 445,814 263,557 1,421,871

Operating Expenses
Selling and marketing expenses 539,975 303,496 2,165,213 1,419,566
General and administrative expenses 830,444 629,455 1,842,815 1,860,239
Research and development 53,939 106,259 136,582 447,034
Depreciation and amortization expense 12,961 11,331 39,506 33,902

Total Operating Expenses 1,437,319 1,050,541 4,184,116 3,760,741

Loss from Operations (1,274,538 ) (604,727 ) (3,920,559 ) (2,338,870 )

OTHER INCOME (EXPENSE)
Foreign exchange (loss) - (6 ) - (6 )
Commitment fee (736,052 ) (787,971 ) (1,409,655 ) (787,971 )
Loss on net change in derivative liability and settlement of debt (2,693,599 ) (7,417,750 ) (2,787,138 ) (1,959,230 )
Interest expense (173,448 ) (206,164 ) (542,450 ) (641,977 )

TOTAL OTHER INCOME (EXPENSE) (3,603,099 ) (8,411,891 ) (4,739,243 ) (3,389,184 )

NET (LOSS) INCOME $ (4,877,637 ) $ (9,016,618 ) $ (8,659,802 ) $ (5,728,054 )

BASIC AND DILUTED (LOSS) EARNING PER SHARE ATTRIBUTABLE TO SHAREHOLDERS’ $ (0.090 ) $ (0.657 ) $ (0.222 ) $ (0.492 )

WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING, BASIC AND DILUTED 54,334,415 13,724,144 38,977,842 11,644,611

	Three Months Ended						Nine Months Ended
	September 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022

Sales	$	1,363,840		$	3,366,061		$	5,200,918		$	7,768,133

Cost of Goods Sold		1,135,541			2,542,887			4,646,349			6,484,235

Gross Profit		228,299			823,174			554,569			1,283,898

Operating Expenses
Selling and marketing expenses		470,566			712,420			1,915,809			1,825,170
General and administrative expenses		904,223			1,085,044			3,008,988			2,900,203
Depreciation and amortization expense		7,579			10,204			23,011			31,446

Total Operating Expenses		1,382,368			1,807,668			4,947,808			4,756,819

Loss from Operations		(1,154,069	)		(984,494	)		(4,393,239	)		(3,472,921	)

OTHER INCOME (EXPENSE)
Other income		569			-			127,448			-
Impairment of receivable from SPAC		(610,000	)		-			(3,260,985	)		-
Gain on write off of loans payable		218,064			-			218,064			75,000
Unrealized gain (loss) on investment securities		800			(24,604	)		(3,721	)		(167,309	)
Gain (Loss) on conversion of preferred stock		-			(188,395	)		-			(434,380	)
Preferred stock incentive compensation		(420,766	)		-			(576,617	)		-
Conversion and settlement value added to note purchase agreements		(1,690,500	)		-			(7,728,089	)		-
Cash settlement for non-conversion of common stock		-			(13,500	)		-			(13,500	)
Gain (Loss) on net change in derivative liability and conversion of debt		(4,064,566	)		(27,607,804	)		(1,238,686	)		(29,176,702	)
Interest and dividend expense		(574,198	)		(233,426	)		(1,324,936	)		(704,434	)

TOTAL OTHER (EXPENSE) INCOME		(7,140,597	)		(28,067,729	)		(13,787,523	)		(30,421,325	)

NET LOSS	$	(8,294,666	)	$	(29,052,223	)	$	(18,180,762	)	$	(33,894,246	)

BASIC AND DILUTED	$	(0.01	)	$	(0.04	)	$	(0.01	)	$	(0.06	)

WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING,
BASIC AND DILUTED		1,301,350,186			775,597,578			1,262,285,766			589,675,480

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

ORIGINCLEAR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED ~~STATEMENT~~STATEMENTS OF SHAREHOLDERS’ DEFICIT

FOR THE NINE MONTHS ENDED SEPTEMBER 30, ~~2017~~2023 AND 2022

Additional Accumulated
Other
Preferred stock Common stock Paid-in Comprehensive Accumulated
Shares Amount Shares Amount Capital loss Deficit Total
Balance at December 31, 2016 7,666 $ 1 21,433,571 $ 2,143 $ 51,428,976 $ (92 ) $ (63,229,607 ) $ (11,798,579 )

Common stock issuance for cash - - 10,775,722 1,078 1,296,672 - - 1,297,750

Common stock issuance for conversion of debt - - 9,321,555 932 1,234,040 - - 1,234,972

Common stock issuance for settlement of accounts payable - - 886,700 89 117,842 - - 117,931

Common stock issued at fair value for services and commitment fees - - 35,734,233 3,573 3,415,025 - - 3,418,598

Stock compensation cost - - - - 71,603 - - 71,603

Other comprehensive loss - - - - - (42 ) - (42 )

Net loss for the nine months ended September 30, 2017 - - - - - - (8,659,802 ) (8,659,802 )

Balance at September 30, 2017 (unaudited) 7,666 $ 1 78,151,781 $ 7,815 $ 57,564,158 $ (134 ) $ (71,889,409 ) $ (14,317,569 )

	NINE MONTHS ENDED SEPTEMBER 30, 2022
																					Accumulated
	Preferred stock						Mezzanine			Common stock						Additional			Subscription		Other Comprehensive			Accumulated
	Shares			Amount			Equity			Shares			Amount			Paid-in-Capital			Payable		loss			Deficit			Total
Balance at December 31, 2021		33,038,213		$	3,304		$	10,183,092			306,883,932		$	30,688		$	75,720,147		$	100,000	$	(132	)	$	(98,175,924	)	$	(22,321,917	)
Rounding		-			-			5			-			-						-		-			(1	)		(1	)
Common stock issuance for conversion of debt and accrued interest		-			-			-			39,900,514			3,990			266,556			-		-			-			270,546

Common stock issued at fair value for services		-			-						41,046,848			4,105			1,050,844			-		-			-			1,054,949

Common stock issued for conversion of Series E Preferred stock		(1,537,213	)		(154	)		-			76,865			7			147			-		-			-			-

Common stock issued for conversion of Series J Preferred stock		-			-			(5,000	)		512,737			51			4,949			-		-			-			5,000

Common stock issued for conversion of Series L Preferred stock		-			-			(284,080	)		25,145,849			2,515			281,565			-		-			-			284,080

Common stock issued for conversion of Series O Preferred stock		-			-			(25,000	)		1,258,812			126			24,874			-		-			-			25,000

Common stock issued for conversion of Series P Preferred stock		-			-			(27,500	)		3,527,317			353			27,147			-		-			-			27,500

Common stock issued for conversion of Series Q Preferred stock		-			-			(100,000	)		12,642,226			1,264			98,736			-		-			-			100,000

Common stock issued for conversion of Series R Preferred stock		-			-			(604,267	)		44,494,096			4,449			599,818			-		-			-			604,267

Common stock issued for conversion of Series T Preferred stock		-			-			(612,000	)		83,105,450			8,311			603,689			-		-			-			612,000

Common stock issued for conversion of Series U Preferred stock		-			-			(581,500	)		30,629,247			3,063			578,437			-		-			-			581,500

Common stock issued for conversion of Series W Preferred stock		-			-			(245,000	)		21,489,284			2,149			242,851			-		-			-			245,000

Common stock issued for conversion of Series Y Preferred stock		-			-			(1,500,000	)		108,238,078			10,824			1,489,176			-		-			-			1,500,000

Common stock issued for conversion Series Q Preferred stock dividends		-			-			-			917,821			92			(92	)		-		-			-			-

Common stock issued for make good shares for Series P Preferred stock											518,232			52			(52	)										-

Common stock issued for make good shares for Series R Preferred stock		-			-			-			1,041,662			104			(104	)		-		-			-			-

Common stock issued for conversion settlement		-			-			-			179,090,390			17,909			(17,909	)		-		-			-			-

Common stock returned from non conversion		-			-			-			(409,518	)		(41	)		(10,459	)		-		-			-			(10,500	)

Issuance of Series Y Preferred stock through a private placement		-			-			4,339,277			-			-			-			-		-			-			-

Issuance of Series Z Preferred stock through a private placement		-			-			250,000			-			-			-			-		-			-			-

Exchange of Series F Preferred Stock for Series Q Preferred stock		-			-			200,000			-			-			-			-		-			-			-

Exchange of Series I Preferred Stock for Series W Preferred stock		-			-			210,000			-			-			-			-		-			-			-

Exchange of Series K Preferred Stock for Series W Preferred stock		-			-			85,000			-			-			-			-		-			-			-

Loss on conversion of Preferred Stock		-			-			-			-			-			434,380			-		-			-			434,380

Net Loss		-			-			-			-			-			-			-		-			(33,894,246	)		(33,894,246	)

Balance at September 30, 2022 (unaudited)		31,501,000		$	3,150			11,283,027			900,109,842		$	90,011		$	81,394,700		$	100,000	$	(132	)	$	(132,070,171	)	$	(50,482,442	)

	NINE MONTHS ENDED SEPTEMBER 30, 2023
	Preferred stock						Mezzanine			Common stock						Additional			Subscription		Other Comprehensive			Accumulated
	Shares			Amount			Equity			Shares			Amount			Paid-in-Capital			Payable		loss			Deficit			Total

Balance at December 31, 2022		32,502,475			3,150		$	10,866,772			1,013,369,185			101,337			82,745,503			100,000		(132	)		(108,966,645	)		(26,016,787	)

Common stock issued for cash per equity financing agreement		-			-			-			20,492,456			2,050			139,323			-		-			-			141,373

Common stock issued upon conversion of convertible promissory note		-			-			-			55,788,402			5,579			161,786											167,365

Common stock issued at fair value for services		-			-			-			62,872,237			6,287			597,291			-		-			-			603,578

Common stock issued for conversion of Series O Preferred stock		-			-			(40,000	)		7,722,008			772			39,228			-		-			-			40,000

Common stock issued for conversion of Series Q Preferred stock		-			-			(195,000	)		50,340,392			5,034			189,966			-		-			-			195,000

Common stock issued for conversion of Series R Preferred stock		-			-			(920,000	)		199,249,857			19,925			900,075			-		-			-			920,000

Common stock issued for conversion of Series S Preferred stock		-			-			(50,000	)		8,864,250			886			49,114			-		-			-			50,000

Common stock issued for conversion of Series U Preferred stock		-			-			(115,000	)		19,051,616			1,905			113,095			-		-			-			115,000

Common stock issued for conversion of Series W Preferred stock		-			-			(8,000	)		2,318,842			232			7,768			-		-			-			8,000

Common stock issued for conversion of Series Y Preferred stock		-			-			(1,810,000	)		331,921,683			33,192			1,776,808			-		-			-			1,810,000

Common stock issued for conversion of Series Z Preferred stock		-			-			(250,000	)		61,728,395			6,173			243,827			-					-			250,000

Common stock issued for Series O Preferred stock dividends		-			-			-			677,526			68			(68	)		-		-			-			-

Common stock issued for conversion of settlement agreements		-			-			-			269,393,920			26,940			(26,940	)		-		-			-			-

Common stock issued for alternative vesting		-			-			-			11,584,932			1,158			(1,158	)		-		-			-			-

Redemption of common stock for note purchase agreements		-			-			-			(810,707,922	)		(81,070	)		81,070			-		-			-			-

Issuance of Series A and B Preferred stock granted to Series Y investors at fair value		545,191			54			-			-			-			576,563			-		-			-			576,617

Issuance of common shares for RegA for cash		-			-			-			12,000			1			59,999			-		-			-			60,000

Cancellation of RegA common and Series A and B Preferred shares		(1,546,666	)		(54	)		-			(12,000	)		-			(113	)		-		-			-			(167	)

Issuance of Series Y Preferred stock through a private placement		-			-			526,300			-			-			-			-		-			-			-

Exchange of Series K for Series W Preferred stock		-			-			100,000			-			-			-					-			-			-

Exchange of Series R Preferred stock for WODI secured convertible note		-			-			(100,000	)		-			-			-			-		-			-			-

Exchange of Series X Preferred stock for WODI secured convertible note		-						(250,000	)		-			-			-			-		-			-			-

Return of investment for Series Y Preferred stock		-			-			(10,000	)		-			(1	)		1			-		-			-			-

Issuance of 1000:1 split of common stock through a merger with subsidiary		-			-			-			10,000,000			1,000			(1,000	)		-		-			-			-

Issuance of common stock to investors after merger		-			-			-			3,399,217			340			(340	)		-		-			-			-

Net Loss		-			-			-			-			-			-			-		-			(18,180,762	)		(18,180,762	)

Balance at September 30, 2023 (unaudited)		31,501,000		$	3,150		$	7,745,072			1,318,066,996		$	131,808		$	87,651,798		$	100,000	$	(132	)	$	(127,147,407	)	$	(39,260,783	)

The accompany notes are an integral part of these unaudited condensed consolidated financial statements

ORIGINCLEAR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022

(Unaudited)

Nine Months Ended
September 30, 2017 September 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (8,659,802 ) $ (5,728,054 )
Adjustment to reconcile net loss to net cash used in operating activities
Depreciation and amortization 39,506 33,902
Common stock and warrants issued for services 3,418,598 1,787,902
Stock option and warrant compensation expense 71,603 155,112
Loss on net change in valuation of derivative liability and conversion of debt 2,787,138 1,959,230
Debt discount and original issue discount recognized as interest expense 313,546 373,434
Change in Assets (Increase) Decrease in:
Contracts receivable (140,653 ) 675,188
Cost in excess of billing 38,374 (12,954 )
Inventory asset (13,614 ) -
Prepaid expenses 24,137 1,797
Work in progress 1,928 518
Other asset - (88,548 )
Change in Liabilities Increase (Decrease) in:
Accounts payable 468,406 299,584
Accrued expenses 121,047 257,501
Billing in excess of cost 209,294 (474,741 )
Deferred income 24,100 (150,000 )

NET CASH USED IN OPERATING ACTIVITIES (1,296,392 ) (910,129 )

CASH FLOWS USED FROM INVESTING ACTIVITIES:
Purchase of fixed assets (33,845 ) (5,699 )

CASH USED IN INVESTING ACTIVITIES (33,845 ) (5,699 )

CASH FLOWS FROM FINANCING ACTIVITIES:
Loans payable 23,372 -
Proceeds from convertible promissory notes - 125,000
Proceeds for issuance of common stock for cash 1,297,750 963,217

NET CASH PROVIDED BY FINANCING ACTIVITIES 1,321,122 1,088,217

Foreign currency effect on cash flow (42 ) (23 )

NET (DECREASE) INCREASE IN CASH (9,157 ) 172,366

CASH BEGINNING OF PERIOD 351,321 695,295

CASH END OF PERIOD $ 342,164 $ 867,661

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid $ 1,823 $ 2,199
Taxes paid $ - $ -

SUPPLEMENTAL DISCLOSURES OF NON CASH TRANSACTIONS
Common stock issued at fair value for conversion of debt and accrued interest $ 1,234,972 $ 878,040
Common stock issued at fair value on settlement of accounts payable $ 117,931 $ -
Common stock issued at fair value for supplemental shares $ 1,409,655 $ 787,971
Beneficial conversion feature on convertible note
$ - $ 16,771
Conversion of accounts payable into a convertible note $ - $ 430,896

		Nine Months Ended
		September 30, 2023			September 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (loss)		$	(18,180,762	)	$	(33,894,246	)
Adjustment to reconcile net loss to net cash
used in operating activities
Depreciation and amortization			23,011			31,446
Common and preferred stock issued for services			603,578			1,054,949
Change in fair value of derivative liability			1,238,686			29,176,702
Preferred stock incentive compensation expense			576,617			-
Debt discount recognized as interest expense			-			3,743
Net unrealized (gain) loss on fair value of securities			4,521			167,309
Impairment of receivable from SPAC			3,260,985			-
Conversion and settlement value loss on WODI			7,728,089			-
(Gain) Loss on conversion of preferred stock			-			434,380
Gain on write off of payable			(218,064	)		(50,000	)
Change in Assets (Increase) Decrease in:
Contracts receivable			1,000,618			204,085
Contract asset			571,164			(1,076,532	)
Inventory asset			-			(15,570	)
Prepaid expenses and other assets			14,825			2,245
Change in Liabilities Increase (Decrease) in:
Accounts payable			(2,169,509	)		1,509,505
Accrued expenses			792,264			173,737
Contract liabilities			338,637			(1,194,376	)
Tax liability 83(b)			(2,000	)		14,600

NET CASH USED IN OPERATING ACTIVITIES			(4,417,340	)		(3,458,023	)


CASH FLOWS USED FROM INVESTING ACTIVITIES:
Purchase of SPAC notes payable			(3,260,985	)		-
Fair value of investment			(800	)		-
Payments received on long term asset			268,000			-
Purchase of fixed assets			(13,500	)		(17,138	)

NET CASH USED IN INVESTING ACTIVITIES			(3,007,285	)		(17,138	)


CASH FLOWS FROM FINANCING ACTIVITIES:	��
Payments on capital lease			-			(6,816	)
Payments on loan payable, SBA			(1,919	)		-
Line of credit			139,879			-
Equity financing purchase agreement			141,373			-
Net payments on cumulative preferred stock dividends payable			20,859			36,500
Convertible secured promissory notes			6,346,500			-
Common stock issued for RegA for cash			60,000			-
Return of investment and common shares			-			(10,500	)
Net proceeds for issuance of preferred stock for cash - mezzanine classification			516,300			4,525,782

NET CASH PROVIDED BY FINANCING ACTIVITIES			7,222,992			4,544,966

NET (DECREASE) INCREASE IN CASH			(201,633	)		1,044,805

CASH BEGINNING OF PERIOD			1,354,814			706,421

CASH END OF PERIOD		$	1,153,181		$	1,751,226

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest and dividends paid		$	674,376		$	828,638
Taxes paid		$	-		$	-

SUPPLEMENTAL DISCLOSURES OF NON CASH TRANSACTIONS
Common stock issued at fair value for conversion of debt, plus accrued interest, and other fees		$	167,365		$	270,546
Issuance of Series O dividends		$	68		$	92
Preferred stock converted to common stock - mezzanine		$	3,388,000		$	3,984,347
Exchange of Series R preferred stock for WODI secured convertible note		$	100,000		$	-
Exchange of Series X preferred stock for WODI secured convertible note		$	250,000		$	-
Exchange from mezzanine to liability		$	-		$	495,000
Common stock issued as settlement		$	26,940		$	17,884
Shares issued for alternate vesting		$	1,158		$	-
Issuance of PWT common stock to WODI shareholders			1,340			-
Redemption of shares for secured promissory notes		$	81,070		$	-

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

ORIGINCLEAR, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-UNAUDITED

SEPTEMBER 30, ~~2017~~2023

1.	Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of OriginClear, Inc. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. For further information refer to the financial statements and footnotes thereto included in the Company’s Form 10-K for the year ended December 31, 2022.

The Company is developing an outsourced water treatment business called Water On Demand (“WOD”), which it conducts through its wholly owned subsidiary, Water on Demand, Inc. (“WODI”). The WOD model intends to offer private businesses water self-sustainability as a service, the ability to pay for water treatment and purification services on a per-gallon basis, with a percentage of net profits paid to investors and stakeholders. This is commonly known as Design-Build-Own-Operate or “DBOO”. In addition to WODI, four subsidiaries were originally established to house capital dedicated to this program. For efficiency, during the nine months ended September 30, 2023, the Company consolidated the funds into a single WOD Subsidiary. As of the three-month period ended September 30, 2023, the Company received net aggregate funding in the amount of $516,300 through the sale of its Series Y Preferred Stock dedicated to the Water on Demand program. The Company is currently evaluating pilot opportunities to enable outsourced water treatment as a managed service and that is paid by the gallon as an alternative to having to come up with significant up-front capital for in-house wasterwater treatment. While these evaluations are ongoing, without guarantee as to when or if these will take place, the Company is placing funds from the sale of Series Y Preferred Stock into various company initiatives to support WOD. There is no guarantee that these funds can be reallocated for a WOD water-as-a-service system. In the interim, while there is no obligation to do so, the Company has made distributions of funds to Series Y holders in lieu of share of profits, paid after the end of each quarter.

As disclosed in its corporate presentation, available at www.originclear.com/investing#companypresentation, the Company intends to launch a first pilot deployment of WOD in 2024. (See graph).

Reinforcement of Water On Demand Inc. with operating businesses

Because WOD is still in early stage development, the Company combined its Modular Water Systems division (MWS) and its wholly owned subsidiary, Progressive Water Systems Inc. (PWT) with Water On Demand, Inc. Due to its operating history, PWT became the master corporate entity and subsequently was renamed Water On Demand, Inc.

Thus, Water On Demand Inc. was absorbed into PWT, as was OriginClear’s in-house business unit MWS. Subsequently, Progressive Water Treatment Inc. was renamed Water On Demand, Inc.

WODI as it is now structured, is composed of two operating units, MWS and PWT, which are in revenue and cash-flow profitable, plus WOD which is a development stage business. (see graph)

This process is discussed in detail in the Overview of Business Section below.

On October 24, 2023, the Company announced a Business Combination Agreement (BCA) for the acquisition of WODI by Fortune Rising Corporation (NASDAQ: FRLA). The Company has a majority ownership of WODI, going into the BCA.

The Company’s mission going forward is:

~~The accompanying unaudited condensed financial statements~~-

For its current WODI program, to support the BCA process, provide management services to WODI and the potential post-merger entity, initiate non-binding agreements for the acquisition of ~~OriginClear, Inc. (the “Company”) (formerly OriginOil, Inc.) have been prepared in accordance with accounting principles generally accepted in~~related businesses by WODI or the ~~United States of America for interim financial information and with~~post-merger entity, which will depend on the ~~instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all~~outcome of the ~~information and footnotes required by generally accepted accounting principles~~BCA process.

For its own account, to accelerate for ~~complete financial statements. In~~new businesses that it may create (as it did with MWS in 2018), acquire (as it did with PWT in 2015) or strategically partner with. For this new phase, the ~~opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included. Operating results for~~Company may engage in projects outside the nine months ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. For further information refer to the financial statements and footnotes thereto includedwater industry, such as in ~~the Company’s Form 10-K for the year ended December 31, 2016.~~conventional or blockchain finance projects.

Going Concern

The accompanying ~~condensed~~ financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. The accompanying ~~condensed~~ financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern. ~~The Company’s revenue is not yet sufficient to cover its operating expenditures and has negative cash flows from operations, which~~These factors, among others raise substantial doubt about the Company’s ability to continue as a going concern. Our independent auditors, in their report on our audited financial statements for the year ended December 31, 2022 expressed substantial doubt about our ability to continue as a going concern.

The ability of the Company to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, achieving a level of profitable operations and receiving additional cash ~~infusion.~~infusions. During the nine months ended September 30, 2023, the Company obtained funds from the issuance of convertible note agreements and from sale of its preferred stock. Management believes this funding will continue from its’ current investors and from new investors. During this period, the Company also generated revenue of $5,200,918 and has standing purchase orders and open invoices with customers, which will provide funds for operations. Management believes the existing shareholders, the prospective new investors ~~current~~ and future sales will provide the additional cash needed to meet the Company’s obligations as they become due and will allow the development of its core business operations. No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, it may contain ~~undue~~ restrictions on our operations, in the case of debt financing or cause substantial dilution for our stockholders, in case of equity financing.

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICES

This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of OriginClear, Inc. and its wholly owned operating subsidiaries, Progressive Water Treatment, Inc., Water on Demand Inc., Water On Demand1, Inc., Water On Demand2, Inc., Water On Demand3, Inc. and OriginClear ~~(HK) Company,~~Technologies, Ltd. All material intercompany transactions have been eliminated upon consolidation of these entities. As of September 30, 2023, the Company reorganized Water On Demand2, Inc. and Water On Demand3, Inc and combined the subsidiaries into Water On Demand1, Inc.

~~Loss~~Cash and Cash Equivalent

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. During the reorganization of Water On Demand1, Inc., Water On Demand2, Inc., and Water On Demand3, Inc., the restricted cash balance on the financial statements as of December 31, 2022 was combined with the overall cash balance of the consolidated Company during the nine months ended September 30, 2023.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include estimates used to review the Company’s impairments and estimations of long-lived assets, revenue recognition on percentage of completion type contracts, allowances for uncollectible accounts, warranty reserves, inventory valuation, derivative liabilities and other conversion features, fair value investments, valuations of non-cash capital stock issuances and the valuation allowance on deferred tax assets. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Net Earnings (Loss) per Share Calculations

Basic loss per share ~~calculations are~~calculation is computed by dividing income (loss) available to common shareholders by the weighted-average number of common shares available. Diluted earnings per share is computed ~~similar~~similarly to basic earnings per share except that the denominator is increased to include securities or other contracts to issue common stock that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive.

The ~~Company has excluded 3,697,495 of stock options, 474,335 warrants, and~~Company’s diluted earnings per share were the ~~shares issuable from convertible debt of $3,667,068 and shares issuable from convertible preferred stock~~same as the basic loss per share for the nine months ended September 30, ~~2017, because~~2023 and 2022, respectively, as the inclusion of any potential shares would have had an anti-dilutive effect due to the Company generating a loss.

	For the Nine Months Ended September 30,
	2023			2022
Loss to common shareholders (Numerator)	$	(18,180,762	)	$	(33,894,246	)

Basic weighted average number of common shares outstanding (Denominator)		1,262,285,766			589,675,480

Diluted weighted average number of common shares outstanding (Denominator)		1,262,285,766			589,675,480

The Company excludes issuable shares from warrants, convertible notes and preferred stock, if their impact on the loss per share is ~~anti-dilutive.~~anti-dilutive and includes the issuable shares if their impact is dilutive.

Revenue Recognition

We recognize revenue when services are performed, and at the time of shipment of products, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, fees are fixed or determinable, and collection of the related receivable is reasonably assured.

Revenues and related costs on construction contracts are recognized as the performance obligations for work are satisfied over time in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. Under ASC 606, revenue and associated profit, will be recognized as the customer obtains control of the goods and services promised in the contract (i.e., performance obligations). All un-allocable indirect costs and corporate general and administrative costs are charged to the periods as incurred. However, in the event a loss on a contract is foreseen, the Company will recognize the loss as it is determined.

Revisions in cost and profit estimates during the course of the contract are reflected in the accounting period in which the facts for the revisions become known. 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, including those arising from contract penalty provisions, and final contract settlements, may result in revisions to costs and income, which are recognized in the period the revisions are determined.

Contract receivables are recorded on contracts for amounts currently due based upon progress billings, as well as retention, which are collectible upon completion of the contracts. Accounts payable to material suppliers and subcontractors are recorded for amounts currently due based upon work completed or materials received, as are retention due subcontractors, which are payable upon completion of the contract. General and administrative expenses are charged to operations as incurred and are not allocated to contract costs.

Contract Receivable

The Company ~~has excluded 113,916,311 stock options, 17,824,259 warrants,~~bills its customers in accordance with contractual agreements. The agreements generally require billing to be on a progressive basis as work is completed. Credit is extended based on evaluation of clients financial condition and collateral is not required. The Company maintains an allowance for doubtful accounts for estimated losses that may arise if any customer is unable to make required payments. Management performs a quantitative and qualitative review of the receivables past due from customers on a monthly basis. The Company records an allowance against uncollectible items for each customer after all reasonable means of collection have been exhausted, and the ~~shares issuable~~potential for recovery is considered remote. The allowance for doubtful accounts was $0 and $17,315 as of September 30, 2023 and December 31, 2022, respectively. The net contract receivable balance was $1,478,505 and $2,479,123 at September 30, 2023 and December 31, 2022, respectively.

Indefinite Lived Intangibles and Goodwill Assets

The Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805, “Business Combinations,” where the total purchase price is allocated to the tangible and identified intangible assets acquired and liabilities assumed based on their estimated fair values. The purchase price is allocated using the information currently available, and may be adjusted, up to one year from ~~convertible debt~~acquisition date, after obtaining more information regarding, among other things, asset valuations, liabilities assumed and revisions to preliminary estimates. The purchase price in excess of ~~$4,214,068~~the fair value of the tangible and ~~shares issuable~~identified intangible assets acquired less liabilities assumed is recognized as goodwill.

The Company tests for indefinite lived intangibles and goodwill impairment in the fourth quarter of each year and whenever events or circumstances indicate that the carrying amount of the asset exceeds its fair value and may not be recoverable. In accordance with its policies, the Company performed a qualitative assessment of indefinite lived intangibles and goodwill at September 30, 2023 and December 31, 2022, respectively, and determined there was no impairment of indefinite lived intangibles and goodwill.

Prepaid Expenses

The Company records expenditures that have been paid in advance as prepaid expenses. The prepaid expenses are initially recorded as assets, because they have future economic benefits, and are expensed at the time the benefits are realized. The prepaid expenses balance was $10,175 and $25,000 at September 30, 2023 and December 31, 2022, respectively.

Property and Equipment

Property and equipment are stated at cost. Gain or loss is recognized upon disposal of property and equipment, and the asset and related accumulated depreciation are removed from ~~convertible preferred stock~~the accounts. Expenditures for maintenance and repairs are charged to expense as incurred, while expenditures for addition and betterment are capitalized. Furniture and equipment are depreciated on the straight-line method and include the following categories:

Estimated Life
Machinery and equipment		5-10 years
Furniture, fixtures and computer equipment		5-7 years
Vehicles		3-5 years
Leasehold improvements		2-5 years

	September 30, 2023			December 31, 2022
Machinery and Equipment	$	383,569		$	383,569
Computer Equipment		66,493			66,493
Furniture		29,810			29,810
Leasehold Improvements		26,725			26,725
Vehicles		64,276			64,276
Demo Units		36,139			36,139
		607,012			607,012
Less accumulated depreciation		(452,954	)		(429,943	)
Net Property and Equipment	$	154,058		$	177,069

Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In the event that the facts and circumstances indicate that the cost of any long-lived assets may be impaired, an evaluation of recoverability would be performed following generally accepted accounting principles.

Depreciation expense during the nine months ended September 30, ~~2016, because their impact on the earnings per share is anti-dilutive.~~2023 and 2022, was $23,011 and $31,446, respectively.

~~Work-in-Process~~

The Company recognizes as an asset the accumulated costs for work-in-process on projects expected to be delivered to customers. Work in Process includes the cost price of materials and labor related to the construction of equipment to be sold to customers.Stock-Based Compensation

~~Stock-Based Compensation~~

The Company periodically issues stock options and warrants to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for stock option and warrant grants issued and vesting to employees based on the authoritative guidance provided by the Financial Accounting Standards Board whereas the value of the award is measured on the date of grant and recognized over the vesting period. The Company accounts for stock option and warrant grants issued and vesting to non-employees in accordance with the authoritative guidance of the Financial Accounting Standards Board whereas the value of the stock compensation is based upon the measurement date as determined at either a) the date at which a performance commitment is reached, or b) at the date at which the necessary performance to earn the equity instruments is complete. Non-employee stock-based compensation charges generally are amortized over the vesting period on a straight-line basis. In certain circumstances where there are no future performance requirements by the non-employee, option grants ~~are~~vest immediately ~~vested~~ and the total stock-based compensation charge is recorded in the period of the measurement date.

~~ORIGINCLEAR, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-UNAUDITED~~

~~SEPTEMBER 30, 2017~~

2.	~~SUMMARY OF SIGNIFICANT ACCOUNTING POLICES (Continued)~~

~~Revenue Recognition~~

~~Equipment sales~~

We recognize revenue upon delivery of equipment, provided that evidence of an arrangement exists, title, and risk of loss have passed to the customer, fees are fixed or determinable, and collection of the related receivable is reasonably assured. Title to the equipment is transferred to the customer once the last payment is received. We record revenue as goods are shipped, and the equipment has been fully accepted by the customer. Generally, we extend credit to our customers and do not require collateral. We do not ship a product until we have a purchase agreement signed by the customer with a payment arrangement.

~~Percentage of completion~~

~~Revenues and related costs on construction contracts are recognized using the “percentage of completion method” of accounting in accordance with ASC 605-35 – “~~Accounting for ~~Performance of Construction-Type and Certain Production Type Contracts”.~~Under this method, contract revenues and related expenses are recognized over the performance period of the contract in direct proportion to the costs incurred as a percentage of total estimated costs for the entirety of the contract. Costs include direct material, direct labor, subcontract labor and any allocable indirect costs. All un-allocable indirect costs and corporate general and administrative costs are charged to the periods as incurred. However, in the event a loss on a contract is foreseen, the Company will recognize the loss as it is determined.Derivatives

The asset “Costs in excess of billings” represents revenues recognized in excess of amounts billed on contracts in progress. The liability “Billings in excess of costs” represents billings in excess of revenues recognized on contracts in progress. AssetsCompany evaluates all its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and ~~liabilities related to long-term contracts are included in current assets and current liabilities~~is then re-valued at each reporting date, with changes in the ~~accompanying balance sheets, as they will be liquidated~~fair value reported in the ~~normal course~~statements of operations. For stock-based derivative financial instruments, the Company uses a probability weighted average series Binomial lattice option pricing models to value the derivative instruments at inception and on subsequent valuation dates.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not the net-cash settlement of the ~~contract completion. The cost in excess~~derivative instrument could be required within 12 months of ~~billings for~~ the nine months ending September 30, 2017 was $9,238 and at December 31, 2016 was $47,612. The billing in excess of cost for the nine months ending September 30, 2017, was $209,294 and at December 31, 2016 was $0.balance sheet date.

~~Contract Receivable~~

The Company bills its customers in accordance with contractual agreements. The agreements generally require billing to be on a progressive basis as work is completed. Credit is extended based on evaluation of clients financial condition and collateral is not required. The Company maintains an allowance for doubtful accounts for estimated losses that may arise if any customer is unable to make required payments. Management performs a quantitative and qualitative review of the receivables past due from customers on a monthly basis. The Company records an allowance against uncollectible items for each customer after all reasonable means of collection have been exhausted, and the potential for recovery is considered remote. The allowance for doubtful accounts was approximately $50,000 as of September 30, 2017 and December 31, 2016, respectively. The net contract receivable balance was $523,548 and $382,895 at September 30, 2017 and December 31, 2016, respectively.

~~ORIGINCLEAR, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-UNAUDITED~~

~~SEPTEMBER 30, 2017~~

2.	~~SUMMARY OF SIGNIFICANT ACCOUNTING POLICES (Continued)~~

Fair Value of Financial Instruments

Fair Value of Financial Instruments requires disclosure of the fair value information, whether or not to recognized in the balance sheet, where it is practicable to estimate that value. As of September 30, ~~2017,~~2023, the balances reported for cash, contract receivables, cost in excess of billing, prepaid expenses, accounts payable, billing in excess of cost, and accrued expenses approximate the fair value because of their short maturities.

We adopted ASC Topic 820 for financial instruments measured as fair value on a recurring basis. ASC Topic 820 defines fair value, established a framework for measuring fair value in accordance with accounting principles generally accepted in the United States and expands disclosures about fair value measurements.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include:

●

Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;

●
	●	Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

●	●	Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The following table presents certain investments and liabilities of the Company’s financial assets measured and recorded at fair value on the Company’s balance sheets on a recurring basis and their level within the fair value hierarchy as of September 30, ~~2017.~~2023.

Total (Level 1) (Level 2) (Level 3)

Derivative Liability $ 10,728,464 $ - $ - $ 10,728,464

Total liabilities measured at fair value $ 10,728,464 $ - $ - $ 10,728,464

		Total				(Level 1)				(Level 2)				(Level 3)
Investment at fair value-securities, September 30, 2023		$	25,804			$	25,804			$	-			$	-

		Total				(Level 1)				(Level 2)				(Level 3)
Derivative Liability, September 30, 2023		$	10,817,590			$	-			$	-			$	10,817,590

The derivative liabilities consist of $10,381,519 for convertible notes outstanding and $436,071 for warrants outstanding for an aggregate of $10,817,590.

The following is a reconciliation of the derivative liability for which level 3 inputs were used in determining the approximate fair value:

Balance as of January 1, 2017 $ 8,702,083
Fair Value of derivative liabilities issued -
Change in derivative liability, excluding loss on settlement of debt 2,026,381
Balance as of September 30, 2017 10,728,464

Balance as of December 31, 2022	$	9,578,904
Net loss on conversion of debt and change in derivative liabilities		1,238,686
Balance as of September 30, 2023	$	10,817,590

For purpose of determining the fair market value of the derivative liability, the Company used Binomial lattice formula valuation model. The significant assumptions used in the Binomial lattice formula valuation of the derivative are as follows:

	~~09/30/2017~~		September 30, 2023
Risk free interest rate		~~.01%~~4.60% - ~~1.92~~	%5.61%
Stock volatility factor		~~4.72%~~51.0% - ~~189.09~~	%173.0%
Weighted average expected option life		6 ~~months~~mos - 5 ~~years~~	yrs
Expected dividend yield		None

~~ORIGINCLEAR, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-UNAUDITED~~

~~SEPTEMBER 30, 2017~~

2.	~~SUMMARY OF SIGNIFICANT ACCOUNTING POLICES (Continued)~~

Segment Reporting

The Company’s business currently operates in one segment based upon the Company’s organizational structure and the way in which the operations are managed and evaluated.

Marketable Securities

The Company adopted ASU 2016-01, “Financial Instruments – Recognition and Measurement of Financial Assets and Financial Liabilities.” ASU 2016-01 requires investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. It requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purpose, and separate presentation of financial assets and financial liabilities by measurement category and form of financial asset. It eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The Company has evaluated the potential impact this standard may have on the condensed consolidated financial statements and determined that it had a significant impact on the condensed consolidated financial statements. The Company accounts for its investment in Water Technologies International, Inc. as available-for-sale securities, and the unrealized gain on the available-for-sale securities is recognized in net income.

Licensing agreement

The Company analyzed the licensing agreement using ASU 606 to determine the timing of revenue recognition. The licensing of the intellectual property (IP) is distinct from the non-license goods or services and has significant standalone functionality that provides a benefit or value. The functionality will not change during the license period due to the licensor’s activities. Because the significant standalone functionality is delivered immediately, the revenue is generally recognized when the license is delivered.

Reclassification

Certain amounts in the prior period financial statements have been reclassified to conform to the presentation used in the current financial statements for comparative purpose. There was no material effect on the Company’s previously issued financial statements.

Work-in-Process

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-2, which creates ASC Topic 842, “Leases.” This update increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This guidance is effective for interim and annual reporting periods beginning after December 15, 2018. We are evaluating what impact, if any, the adoption of this guidance will have on our financial condition, results of operations, cash flows or financial disclosures.

In August 2016, the FASB issued ASU No. 2016-15 which amends ASC Topic 230, “Classification of Certain Cash Receipts and Cash Payments.” The amendments in this Update address eight specific cash flow issues with the objective of reducing the existing diversity in practice. The update outlines the classification of specific transactions as either cash inflows or outflows from financing activities, operating activities, investing activities or non-cash activities. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017. We are evaluating what impact, if any, the adoption of this guidance will have on our financial condition, results of operations, cash flows or financial disclosures.

In May 2017, FASB issued accounting standards update ASU-2017-09, “Compensation-Stock Compensation” (Topic 718) –Modification Accounting”, to provide clarity and reduce both (1) diversity in practice and (2) cost and complexity when applying the guidance in Topic 718, Compensation-Stock Compensation, to a change to the terms or conditions of a share-based payment award. The amendments in this ASU are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period for public entities for reporting periods for which financial statements have not yet been issued, and all other entities for reporting periods for which financial statements have not yet been made available for issuance. The Company is currently evaluating the impact of the adoption of ASU 2017-09 on the Company’s financial statements.

In August 2017, FASB issued accounting standards update ASU-2017-12, “D” (Topic 815) – “Targeted Improvements to Accounting for Hedging Activities”, to require an entity to present the earnings effect of the hedging instrument in the same statement line item in which the earnings effect of the hedged item is reported. The amendments in this update are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods with the fiscal years beginning after December 15, 2020. Early adoption is permitted in any interim period after issuance of the update. The Company is currently evaluating the impact of the adoption of ASU 2017-12 on the Company’s financial statements.

Management reviewed currently issued pronouncements ~~during the period ended September 30, 2017,~~ and does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying condensed financial statements.

~~On March 30, 2017, the Board of Directors of the Company authorized the withdrawal of the Series A preferred stock. As of September 30, 2017, no shares of Series A preferred stock were outstanding.~~

On October 1, 2015, the Company filed a Certificate of Designation for Series B preferred stock with the Secretary of State of Nevada and the shares of Series B preferred stock were issued to the shareholders of Progressive Water Treatment, Inc. in connection with the share exchange agreement. One third (1/3) of the shares received by the holder may be converted into common stock beginning one (1) year after the first date on which a share of Series B Preferred Stock was issued (the “Original Issue Date); one third (1/3) may be converted beginning two (2) years after the Original Issue Date; and the remaining one third (1/3) may be converted beginning three years after the Original Issue Date. The number of shares of common stock issuable for each share of converted Series B preferred stock shall be calculated by dividing the stated value by the market price, the market price shall be the average of the closing trade prices of the twenty-five (25) days prior to the date of the conversion notice. On August 12, 2016, the agreement was amended to include make-good-shares. The conversion price set forth in Section 1.2 of the agreement shall be adjusted to reflect the lower of $1.05 or the price of the Company’s common stock calculated using the average closing prices of the Company’s common stock on the last three (3) trading days prior to the date of conversion, provided, however, if the Average Closing Price is less than $0.35 per share, the adjusted conversion price shall be $0.35 per share. See Note 3. The conversion price is subject to adjustment in the case of reverse splits, stock dividends, reclassifications and the like. In addition, the conversion price is subject to certain full ratchet anti-dilution protection. Accordingly, the preferred stock is valued under the provision of ASC Topic 815, Derivatives and Hedging, because the conversion feature of the preferred stock was not afforded the exemption for conventional convertible instruments due to its variable conversion rate. The Series B preferred stock shall have the rights, preferences and privileges as set forth in the exchange agreement. As of September 30, 2017, there are 6,666 shares of Series B preferred stock outstanding.

On March 14, 2017, the Board of Directors authorized the issuance of 1,000 shares of Series C preferred stock, par value $0.0001 per share, to T. Riggs Eckelberry in exchange for his continued employment with the Company. The holder of Series C preferred stock is not entitled to receive dividends, is not entitled to any liquidation preference and shares of Series C preferred stock does not have any conversion rights. The Series C Preferred Stock entitles the holder to 51% of the total voting power of our stockholders. The purchase price of the Series C preferred stock was $0.0001 per share representing a total purchase price of $0.10 for 1,000 shares. As of September 30, 2023, there were 1,000 shares of Series C preferred stock outstanding held by Mr. Eckelberry.

On April ~~7, 2017,~~13, 2018, the Company ~~filed~~designated 50,000,000 shares of its authorized preferred stock as Series D-1 preferred stock. The shares of Series D-1 preferred stock are not entitled to dividends and do not have a ~~certificate~~liquidation preference. Each share of ~~amendment~~Series D-1 preferred stock is convertible into 0.0005 of one share of common stock. The Series D-1 preferred stock may not be converted to common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of our outstanding common stock, which amount may be increased to 9.99% at the holders discretion upon 61 days’ written notice. As of September 30, 2023, there were 31,500,000 shares of Series D-1 preferred stock issued and outstanding.

On August 14, 2018, the Company designated 6,000 shares as Series F preferred stock. The shares of Series F preferred stock have a liquidation preference equal to the stated value of $1,000 per share plus any accrued but unpaid dividends. The Series F preferred stock is not convertible into common stock. The holders of outstanding shares of Series F preferred stock are entitled to quarterly dividends at the annual rate of 8% of the stated value, in preference to any dividends on the common stock. The shares of Series F preferred stock do not carry any voting rights. The Company may, in its ~~articles~~sole discretion, at any time while the Series F preferred stock is outstanding, redeem all or any portion of ~~incorporation~~the outstanding Series preferred stock at a price equal to the stated value, plus any accrued but unpaid dividends. The Company was required to redeem all outstanding shares of Series F preferred stock on September 1, 2020. As of September 30, 2023, the Company had 60 outstanding shares of Series F preferred stock, which the Company was required to, and failed to redeem on September 1, 2020, and remains in default for an aggregate redemption price (equal to the stated value) of $60,000.

On January 16, 2019, the Company designated 6,000 shares as Series G preferred stock, each share having a stated value of $1,000 per share and holders of Series G preferred stock are entitled to cumulative dividends at the annual rate of 8% of the stated value, payable quarterly. The Series G preferred stock does not have voting rights, except as required by law and is not convertible into common stock. The Company may, in its sole discretion, at any time while the Series G preferred stock is outstanding, redeem all or any portion of the outstanding Series G preferred stock at a price equal to the stated value plus any accrued but unpaid dividends. The Company was required to redeem such shares of Series G preferred stock on April 30, 2021, at a price equal to the stated value plus any accrued but unpaid dividends. Pursuant to certain subscription agreements entered into with purchasers of the ~~State of Nevada effectuating a reverse split~~Series G preferred stock, each purchaser received shares of the Company’s common stock equal to an amount of, for each share of Series G preferred stock purchased, five hundred dollars ($500) divided by the closing price on the date the Company receives the executed subscription documents and purchase price from such investor. As of September 30, 2023, there were 25 shares of Series G preferred stock issued and outstanding, which the Company was required to, and failed to redeem on April 30, 2021, for an aggregate redemption price (equal to the stated value) of $25,000.

On April 3, 2019, the Company designated 4,000 shares of preferred stock as Series I. The Series I has a stated value of $1,000 per share. Series I holders are entitled to cumulative dividends at the annual rate of 8% of the stated value, payable quarterly within 60 days from the end of each fiscal quarter. The Series I is not entitled to any voting rights except as may be required by applicable law, and are not convertible into common stock. The Company has the right to redeem the Series I at any time while the Series I are outstanding at a ~~ratio~~price equal to the stated value plus any accrued but unpaid dividends. The Company is required to redeem the Series I two years following the date that is the later of ~~1 for 35 (the “Reverse Split”). The Reverse Split became effective~~the (i) final closing of the tranche (as designated in the ~~State~~applicable subscription agreement) or (ii) the expiration date of ~~Nevada on~~the tranche that such shares to be redeemed were a part of. The Company was required to redeem such shares of Series I between May 2, 2021 and June 10, 2021, at a price equal to the stated value plus any accrued but unpaid dividends. The issuances of the shares were accounted for under ASC 480-10-25-4, which requires liability treatment for certain mandatorily redeemable financial instruments, and the cumulative dividends are recorded as interest expense. As of September 30, 2023, there were 25 shares of Series I preferred stock issued and outstanding which the Company was required to, and failed to redeem by June 10, 2021, and was and remains in default for an aggregate redemption price (equal to the stated value) of $25,000.

On April ~~12, 2017. Unless otherwise indicated, all share amounts,~~3, 2019, the Company designated 100,000 shares of preferred stock as Series J. The Series J has a stated value of $1,000 per share ~~data, share prices, exercise prices,~~ and ~~conversion rates~~holders are entitled to receive dividends on an as-converted basis with the Company’s common stock. The Series J preferred stock is convertible into shares of the Company’s common stock, on the terms and conditions set forth in ~~this Quarterly Report~~the Series J COD, which includes certain make-good shares for certain prior investors. As of September 30, 2023, there were 210 shares of Series J preferred stock issued and ~~the accompanying unaudited condensed consolidated financial statement have, where applicable been adjusted retroactively to reflect this reverse stock split.~~outstanding.

On June ~~30, 2017,~~3, 2019, the Company ~~filed~~designated 4,000 shares of preferred stock as Series K. The Series K has a ~~certificate~~stated value of ~~amendment (the “Certificate~~$1,000 per share. Series K holders are entitled to cumulative dividends at the annual rate of ~~Amendment”)~~8% of the stated value, payable quarterly within 60 days from the end of each fiscal quarter. The Series K is not entitled to ~~amend Article~~any voting rights except as may be required by applicable law, and is not convertible into common stock. The Company has the right to redeem the Series K at any time while the Series K are outstanding at a price equal to the stated value plus any accrued but unpaid dividends. The Company was required to redeem the Series K two years following the date that is the later of the (i) final closing of the tranche (as designated in the applicable subscription agreement) or (ii) the expiration date of the tranche that such shares to be redeemed were a part of. The Company was required to redeem such shares of Series K between August 5, 2021 and April 24, 2022, at a price equal to the stated value plus any accrued but unpaid dividends. The issuances of the shares were accounted for under ASC 480-10-25-4, which requires liability treatment for certain mandatorily redeemable financial instruments, and the cumulative dividends are recorded as interest expense. During the nine months ended September 30, 2023, the Company exchanged an aggregate of 100 shares of Series K preferred stock for 100 shares of Series W preferred stock. As of September 30, 2023, there were 307 shares of Series K preferred stock issued and outstanding which the Company was required to, and failed to redeem by April 24, 2022, and was and remains in default for an aggregate redemption price (equal to the stated value) of $307,150.

On June 3, 2019, the Company designated 100,000 shares of ~~its articles~~preferred stock as Series L. The Series L has a stated value of ~~incorporation~~$1,000 per share and holders are entitled to receive dividends on an as-converted basis with the Company’s common stock. The Series L preferred stock is convertible into shares of the Company’s common stock, on the terms and conditions set forth in the Series L COD, which includes certain make-good shares for certain prior investors. As of September 30, 2023, there were 321 shares of Series L preferred stock issued and outstanding.

Pursuant to the Amended and Restated Certificate of Designation of Series M Preferred Stock filed with the Secretary of State of Nevada ~~effectuating~~on July 1, 2020, the Company designated 800,000 shares of its preferred stock as Series M Preferred Stock. Each share of Series M Preferred Stock has a ~~decrease~~stated value of $25. The Series M Preferred Stock is not convertible into common stock. The holders of outstanding shares of Series M Preferred Stock are entitled to receive dividends, at the annual rate of 10%, payable monthly, payable in preference and priority to any payment of any dividend on the common stock. The Series M Preferred Stock is entitled to a liquidation preference in an amount equal to $25 per share plus any declared but unpaid dividends, before any payments to holders of common stock. The Series M Preferred Stock have no pre-emptive or subscription rights, and there are no sinking fund provisions applicable to the Series M Preferred Stock. The Series M Preferred Stock does not have voting rights, except as required by law and with respect to certain protective provisions set forth in the Certificate of Designation of Series M Preferred Stock. To the extent it may lawfully do so, the Company may, in its sole discretion, at any time when there are outstanding shares of Series M Preferred Stock, redeem any or all of the then outstanding shares of Series M Preferred Stock at a redemption price of $37.50 per share (150% of the stated value) plus any accrued but unpaid dividends. As of September 30, 2023, there were 40,300 shares of Series M preferred stock issued and outstanding.

On April 27, 2020, the Company designated 2,000 shares of preferred stock as Series O preferred stock. The Series O preferred stock has a stated value of $1,000 per share, and entitles holders to receive cumulative dividends (i) in cash at an annual rate of 8% of the stated value, and (ii) in shares of common stock of the Company (valued based on the conversion price as in effect on the last trading day of the applicable fiscal quarter) at an annual rate of 4% of the stated value, payable quarterly within 60 days from the end of such fiscal quarter. The Series O preferred stock has a liquidation preference equal to the stated value plus any accrued but unpaid dividends, in preference to the common stock. The Series O preferred stock has no preemptive or subscription rights, and there is no sinking fund provision applicable to the Series O preferred stock. The Series O preferred stock does not have voting rights except as required by law. The Series O preferred stock is convertible into common stock of the Company in an amount determined by dividing 200% of the stated value of the Series O preferred stock being converted by the conversion price, provided that, the Series O may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which may be increased up to 9.99% upon 61 days’ written notice). The conversion price is equal to the average closing sale price of the common stock for the five trading days prior to the conversion date. The Company has the right (but no obligation) to redeem the Series O preferred stock at any time while the Series O preferred stock are outstanding at a redemption price equal to the stated value plus any accrued but unpaid dividends. The cumulative dividends are recorded as interest expense. During the nine months ended September 30, 2023, the Company issued an aggregate of 7,722,008 shares of common stock upon conversion of 40 shares of Series O preferred stock and issued an aggregate of 677,526 shares of common stock in prorated 4% annualized dividends which were recorded as interest expense. The shares were issued within the terms of the agreement and no gain or loss was recognized. As of September 30, 2023, there were 190 shares of Series O preferred stock issued and outstanding.

On April 27, 2020, the Company designated 500 shares of preferred stock as Series P preferred stock. The Series P preferred stock has a stated value of $1,000 per share, and entitles holders to receive dividends on an as-converted basis with the Company’s common stock. The Series P preferred stock is convertible into shares of the Company’s common stock, on the terms and conditions set forth in the Certificate of Designation of Series P preferred stock, which includes certain make-good shares for certain prior investors, and provided that, the Series P preferred stock may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which may be increased up to 9.99% upon 61 days’ written notice). The Series P preferred stock entitles the holders to a payment on an as-converted and pari-passu basis with the common stock upon any liquidation. The Series P preferred stock has no preemptive or subscription rights, and there is no sinking fund or redemption provisions applicable to the Series P preferred stock. The Series P preferred stock votes on an as-converted basis with the common stock, subject to the beneficial ownership limitation. As of September 30, 2023, there were 30 shares of Series P preferred stock issued and outstanding.

On August 21, 2020, the Company designated 2,000 shares of preferred stock as Series Q Preferred Stock. The Series Q Preferred Stock has a stated value of $1,000 per share, and entitles holders to receive cumulative dividends in cash at an annual rate of 12% of the stated value, payable quarterly within 60 days from the end of such fiscal quarter. The Series Q Preferred Stock has a liquidation preference equal to the stated value plus any accrued but unpaid dividends, in preference to the common stock. The Series Q Preferred Stock has no preemptive or subscription rights, and there is no sinking fund provision applicable to the Series Q Preferred Stock. The Series Q Preferred Stock does not have voting rights except as required by law. The Series Q Preferred Stock is convertible into common stock of the Company in an amount determined by dividing 200% of the stated value of the Series Q Preferred Stock being converted by the conversion price, provided that, the Series Q may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which may be increased up to 9.99% upon 61 days’ written notice). The conversion price will be equal to the average closing sale price of the common stock for the five trading days prior to the conversion date. The Company has the right (but no obligation) to redeem the Series Q Preferred Stock at any time while the Series Q Preferred Stock are outstanding at a redemption price equal to the stated value plus any accrued but unpaid dividends. The cumulative dividends are recorded as interest expense. During the nine months ended September 30, 2023, the Company issued an aggregate of 50,340,392 shares of common stock upon conversion of 195 shares of Series Q preferred stock. The shares were issued and exchanged within the terms of the agreement and no gain or loss was recognized. As of September 30, 2023, there were 420 shares of Series Q preferred stock issued and outstanding.

On November 16, 2020, the Company designated 5,000 shares of preferred stock as Series R. The Series R has a stated value of $1,000 per share, and entitles holders to receive cumulative dividends in cash at an annual rate of 10% of the stated value, payable quarterly within 60 days from the end of such fiscal quarter. The Series R holders are not entitled to any voting rights except as may be required by applicable law. The Series R is convertible into common stock of the Company in an amount determined by dividing 200% of the stated value of the Series R being converted by the conversion price; certain prior investors will also be entitled to certain make-good shares; provided that, the Series R may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which may be increased up to 9.99% upon 61 days’ written notice). The conversion price will be equal to the average closing sale price of the common stock for the five trading days prior to the conversion date. The Company has the right (but no obligation) to redeem the Series R at any time while the Series R are outstanding at a redemption price equal to, if paid in cash, the stated value plus any accrued but unpaid cash dividends, or, if paid in shares of common stock, in an amount of shares determined by dividing the stated value being redeemed by the conversion price. The subscribers were offered warrants with the purchase of Series R. During the nine months ended September 30, 2023, the Company issued an aggregate of 199,249,857 shares of common stock upon conversion of 920 shares of Series R preferred stock and the Company’s subsidiary, Water On Demand, Inc., executed a Secured Note Purchase Agreement upon redemption of an aggregate of 100 shares of Series R preferred stock. The shares were issued and exchanged within the terms of the agreement and no gain or loss was recognized. As of September 30, 2023, there were 1,808 shares of Series R preferred stock issued and outstanding.

On February 5, 2021, the Company designated 430 shares of preferred stock as Series S. The Series S has a stated value of $1,000 per share, and entitles holders to receive cumulative dividends in cash at an annual rate of 12% of the stated value, payable quarterly within 60 days from the end of such fiscal quarter. The Series S holders are not entitled to any voting rights except as may be required by applicable law. The Series S is convertible into common stock of the Company in an amount determined by dividing 200% of the stated value of the Series S being converted by the conversion price, provided that, the Series S may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which may be increased up to 9.99% upon 61 days’ written notice). The conversion price will be equal to the average closing sale price of the common stock for the five trading days prior to the conversion date. The Company has the right (but no obligation) to redeem the Series S at any time while the Series S are outstanding at a redemption price equal to the stated value plus any accrued but unpaid dividends. During the nine months ended September 30, 2023, the Company issued an aggregate of 8,864,250 shares of common stock upon conversion of 50 shares of Series S preferred stock. The shares were issued within the terms of the agreement and no gain or loss was recognized. As of September 30, 2023, there were 120 shares of Series S preferred stock issued and outstanding.

On May 26, 2021, the Company designated 5,000 shares of preferred stock as Series U. The Series U has a stated value of $1,000 per share. The Series U holders are not entitled to any dividends and do not have any voting rights except as may be required by applicable law. The Series U is convertible into common stock of the Company in an amount determined by dividing 150% of the stated value of the Series U being converted by the conversion price; certain prior investors will also be entitled to certain make-good shares; provided that, the Series U may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which may be increased up to 9.99% upon 61 days’ written notice). The conversion price will be equal to the lesser of $0.20 or the average closing sale price of the common stock for the five trading days prior to the conversion date. The Company has the right (but no obligation) to redeem the Series U at any time at a redemption price equal to, if paid in cash, the stated value, or, if paid in shares of common stock, in an amount of shares determined by dividing 200% of the stated value being redeemed by the conversion price then in effect, and adding any applicable make-good shares. During the nine months ended September 30, 2023, the Company issued an aggregate of 19,051,616 shares of common stock upon conversion of 115 shares of Series U preferred stock. The shares were issued within the terms of the agreement and no gain or loss was recognized. As of September 30, 2023, there were 270 shares of Series U preferred stock along with 6,447,500 warrants with a fair value of $1 (with exercise prices between $0.10 and $1.00) issued and outstanding. These warrants associated with Series U were valued using the Black Scholes model (See Note 4).

On April 28, 2021, the Company designated 3,390 shares of preferred stock as Series W. The Series W has a stated value of $1,000 per share, and Series W holders are entitled to cumulative dividends in cash at an annual rate of 12% of the stated value, payable quarterly. The Series W holders are not entitled to any voting rights except as may be required by applicable law. The Series W is convertible into common stock of the Company in an amount determined by dividing 200% of the stated value of the Series W being converted by the conversion price; provided that, the Series W may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock. The conversion price will be equal to the average closing sale price of the common stock for the five trading days prior to the conversion date. The Company has the right (but no obligation) to redeem the Series W at any time at a redemption price equal to the stated value plus any accrued but unpaid dividends. During the nine months ended September 30, 2023, the Company issued an aggregate of 2,318,842 shares of common stock upon conversion of 8 shares of Series W preferred stock and exchanged an aggregate of 100 shares of Series K preferred stock for 100 shares of Series W preferred stock. As of September 30, 2023, there were 912 shares of Series W preferred stock issued and outstanding.

On August 10, 2021, the Company designated 25 shares of preferred stock as Series X. The Series X had a stated value of $10,000 per share. The Series X holders were not entitled to any dividends and did not have any voting rights except as may have been required by applicable law. The Series X was convertible into common stock of the Company pursuant to the Series X COD, provided that, the Series X was not to be converted into common stock to the extent such conversion would have resulted in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which amount may have been increased up to 9.99% upon 61 days’ written notice). Beginning on the one year anniversary of the subscription agreement for the Series X Preferred Stock, until the two year anniversary of the subscription agreement, the holders had the right to require the Company to redeem all of the Series X purchased by the subscriber at a price equal to 125% of the $250,000 original purchase price, or $312,500. The holders also had the right, exercisable at any time, to require the Company to redeem all of the holder’s Series X in exchange for the issuance of shares of the Company’s common stock in an amount equal to 250% of the original $250,000 purchase price, or $625,000, divided by the closing price of the Company’s common stock as of the date the holders executed the subscription agreement. During the nine months ended September 30, 2023, the Company’s subsidiary, Water On Demand, Inc., executed a Secured Note Purchase Agreement upon redemption of an aggregate of 25 shares of Series X preferred stock, which had a stated value of $250,000. The shares were redeemed within the terms of the agreement and no gain or loss was recognized. As of September 30, 2023, there were no shares of Series X preferred stock issued and outstanding.

On December 6, 2021, the Company designated 3,000 shares of preferred stock as Series Y. The Series Y has an original issue price of $100,000 per share, and holders are entitled to receive, on a pro rata and pari passu basis, annual distribution of up to 25% of annual net profits of newly established, wholly-owned, Water On Demand subsidiaries, designated by each holder, paid within 3 months of subsidiary’s accounting year-end. The Series Y holders are not entitled to any voting rights except as may be required by applicable law. The Series Y is convertible into common stock of the Company pursuant to the Series Y COD, provided that, the Series Y may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which may be increased up to 9.99% upon 61 days’ written notice). The Company has the right (but no obligation) to redeem the Series Y at any time at a redemption price equal to, if paid in cash, the original issue price plus any accrued but unpaid distributions of 25% of the subsidiary’s annual net profits. In addition, the Series Y holders received shares of Series A preferred stock in the Company’s subsidiary Water On Demand, Inc or warrants to purchase common shares in Water On Demand, Inc. During the nine months ended September 30, 2023, the Company received aggregate net funding in the amount of $516,300 through the sale of Series Y preferred stock, including the redemption of an aggregate of 0.1 shares of Series Y preferred stock equal to the stated value of $10,000, and issued an aggregate of 331,921,683 shares of common stock upon conversion of 18.1 shares of Series Y preferred stock. The shares were issued within the terms of the agreement and no gain or loss was recognized. As of September 30, 2023, there were 24.6 shares of Series Y preferred stock along with 49,780,616 warrants with a fair value of $316,391 (with exercise prices between $0.13 and $0.25) issued and outstanding. The warrants were valued using the Black Scholes model (See Note 4).

On February 11, 2022, the Company designated 25 shares of preferred stock as Series Z. The Series Z has an original issue price of $10,000 per share. The Series Z holders are not entitled to dividends or any voting rights except as may be required by applicable law. The Series Z is convertible into common stock of the Company pursuant to the Series Z COD, provided that, the Series Z may not be converted into common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock (which amount may be increased up to 9.99% upon 61 days’ written notice). The Company has the right (but no obligation) to redeem the Series Z at any time at a redemption price equal to the original issue price plus any accrued but unpaid distributions of 25% of Subsidiary’s annual net profits. On February 18, 2022, the Company issued and sold to an accredited investor an aggregate of 25 shares of Series Z preferred stock for a purchase price of $250,000 and issued an aggregate of 2,500,000 warrants. During the nine months ended September 30, 2023, the Company issued an aggregate of 61,728,395 shares of common stock upon conversion of 25 shares of Series Z preferred stock. The shares were issued within the terms of the agreement and no gain or loss was recognized. As of September 30, 2023, there were 2,500,000 warrants with a fair value of $16,591 (with an exercise price of $0.10) and no shares of Series Z preferred stock issued and outstanding.

As of September 30, 2023, the Company accrued aggregate dividends in the amount of $436,456 for all series of preferred stock.

During the nine months ended September 30, 2023, the Company redeemed an aggregate of 810,707,922 shares of common stock at prices ranging from $0.006 to $.013 per share with a value of $81,070 relating to Series R and Series Y conversions and settlement agreements with certain WODI convertible secured promissory note holders.

The Series J, Series L, Series M, Series O, Series P, Series Q Series R, Series S, Series T, Series U, Series V, Series W, Series X, Series Y, and Series Z preferred stock are accounted for outside of permanent equity due to the terms of conversion at a market component or stated value of the preferred stock.

On April 22, 2022, WODI designated 50,000,000 shares of authorized Preferred Stock at $0.0001 par value per share.

On October 13, 2022, WODI designated 1,000,000 shares of its authorized preferred stock as Series A preferred stock. The shares of Series A preferred stock are reserved for issuance to the holders of parent Company’s, OriginClear, Inc., Series Y preferred shares and issuable to the holders of the Series Y shares at a ratio of 500:1. The holders of Series A preferred shares shall not be entitled to dividends and shall not be entitled to a vote until such time as the Series A preferred shares are converted to common shares. Each share of Series A preferred stock shall be convertible, at any time at the conversion ratio of 50:1, or such other rate as determined by the Board, provided, however that at no time shall the total number of issued and outstanding Series A preferred shares, on a converted basis, be less than ten percent (10%) (‘Dilution Floor’) of the total authorized shares of common stock (on a fully diluted basis) based upon an anticipated sale of $20,000,000 in Series Y shares. The dilution floor shall be adjusted proportionately based upon the actual number of Series Y shares sold. On November 7, 2022, WODI filed an Amended and Restated Certificate of Incorporation and effected a 20:1 reverse stock split with respect to the common shares and the Series A preferred shares.

During the nine months ended September 30, 2023, WODI issued an aggregate of 6,791 shares of its Series A preferred stock to certain holders of the Company’s Series Y preferred stock at par value of $0.0001. Due to WODI’s merger with PWT on September 21, 2023 (See Footnote 9), all Series A preferred shares were fully converted to common stock in WODI. As of September 30, 2023, there were 0 shares of Series A preferred stock issued and outstanding.

The Series A preferred shares were valued by an independent valuation expert based on a Probability Weighted Expected Return Methodology (“PWERM”) with an underlying Discounted Cash Flow (“DCF”) analysis.

Based on the above, the value of WODI Series A preferred shares were determined to be as follows:

Out of the total 6,791 shares issued during the nine months ended September 30, 2023, 201 shares were issued in Q1, 2023 and were valued at $106.67 per share, 8 shares which were issued in Q2, 2023 were valued at $266.73 per share, and 6,582 shares which were issued in Q3, 2023 were valued at $54.58 for an aggregate expense of $382,793 for the nine months ended September 30, 2023 and recorded as preferred stock incentive compensation in the consolidated financial statements.

On April 28, 2023, WODI designated 1,000,000 shares of its authorized preferred stock as Series B preferred stock. The shares of Series B preferred stock have an initial issuance value of $5.00 per share and are reserved for issuance to the holders of parent Company’s, OriginClear, Inc., Series X preferred shares and other direct issuances at the discretion of the WODI board of directors. The holders of Series B preferred shares shall not be entitled to dividends and shall not be entitled to a vote until such time as the Series B preferred shares are converted to common shares. Each share of Series B preferred stock shall be convertible, at any time per terms of the Series B Certificate of Designation, provided, however that at no time shall the total number of issued and outstanding Series B preferred shares, on a converted basis, be less than 2.5 percent (2.5%) (‘Dilution Floor’) of the total authorized shares of common stock (on a fully diluted basis) based upon an anticipated issuance of $5,000,000 in Series B shares. The dilution floor shall be adjusted proportionately based upon the actual number of Series B shares. During the nine months ended September 30, 2023, WODI issued an aggregate of 538,400 shares of its Series B preferred stock with a par value of $0.0001, to certain holders of the Company’s Series X preferred stock and holders of WODI Note Purchase Agreements. Due to WODI’s merger with PWT on September 21, 2023 (See Note 9 for details), all Series B preferred shares were fully converted to common stock in WODI. As of September 30, 2023, there were 0 shares of Series B preferred stock issued and outstanding.

The Series B preferred shares were valued by an independent valuation expert based on a Probability Weighted Expected Return Methodology (“PWERM”) with an underlying Discounted Cash Flow (“DCF”) analysis.

Based on the above, the value of WODI Series B preferred shares were determined to be as follows:

For the nine months ended September 30, 2023, the shares granted in Q2 and Q3 were valued at $0.36 and $0.37 per share respectively, for an aggregate expense of $193,824 and recorded as preferred stock incentive compensation in the consolidated financial statements.

On October 13, 2022, the Board of Directors authorized the issuance of 1,000,000 shares of Series C preferred stock, par value $0.0001 per share, to T. Riggs Eckelberry (the “Holder”) in exchange for his continued employment with the Company. The Holder of Series C preferred stock is not entitled to receive dividends, is not entitled to any liquidation preference and shares of Series C preferred stock does not have any conversion rights. The Holder of Series C preferred shares shall vote with the holders of the common shares on an as converted basis. However, as long as any shares of Series C preferred shares are outstanding, the Company shall not, without the affirmative vote of the Holders of a majority of the then outstanding shares of the Series C preferred shares directly and/or indirectly (a) alter or change adversely the powers, preferences or rights given to the Series C preferred shares or alter or amend this Certificate of Designation, (b) amend its Articles of Incorporation or other charter documents in any manner that adversely affects any rights of the Holders, (c) increase the number of authorized shares of Series C preferred shares, or (d) enter into any agreement with respect to any of the ~~Company. Pursuant~~foregoing. Notwithstanding the foregoing, the Holder shall be entitled to vote a number of shares equal to fifty-one percent (51%) of the ~~Certificate~~total number of ~~Amendment,~~voting shares. Due to WODI’s merger with PWT (See Note 9), all Series C preferred shares were cancelled per the plan of merger agreement dated September 21, 2023. As of September 30, 2023, there were 0 of Series C preferred stock outstanding.

On October 20, 2022, the Company ~~reduced~~entered into an Equity Financing Agreement (“Financing Agreement”) with GHS Investments, LLC (“GHS”), whereby GHS agreed to purchase, at the ~~number~~Company’s sole discretion, up to $25,000,000 worth of authorized shares of its common stock to 300,000,000. The Certificate of Amendment became effective upon filing with the State of Nevada on June 30, 2017. The reduction in the number of authorized shares does not affect the shares of the Company’s common stock (the “Shares”), par value $0.0001 per share. In accordance with the terms of the Financing Agreement and the Registration Rights Agreement (“Registration Agreement”) dated October 20, 2022 between the Company and GHS, the Company was required to register the Shares on Form S-1 with the Securities and Exchange Commission as a condition precedent to GHS’s obligation to close on the purchase of the Shares. On December 27, 2022, the Securities and Exchange Commission issued a Notice of Effectiveness of the Registration Statement filed on Form S-1 (File Number 333-268608) for OriginClear, Inc. Per Financing Agreement, during the nine months ended September 30, 2023, the Company received an aggregate of $141,373 in equity financing and ~~outstanding.~~issued an aggregate of 20,492,456 shares of the Company’s common stock to GHS.

The Company issued 20,492,456 shares of common stock for cash, through an equity financing agreement for a total aggregate of $141,373 based upon conversion prices ranging from $0.0058 to $0.0082.

The Company issued ~~10,775,722~~55,788,402 shares of common stock ~~through private placements at prices~~upon conversion of ~~$0.05 to $0.175 per share for cash~~a convertible promissory note in the amount of ~~$1,297,750.~~principal of $91,000, plus accrued interest of $76,365, for a total aggregate of $167,365 based upon a conversion price of $0.0085. The shares were issued within the terms of the agreements and no gain or loss was recognized.

The Company issued 62,872,237 shares of common stock for services at fair value of $603,578, at share prices ranging from $0.0073 - $0.0146.

The Company issued 677,526 shares of common stock for Series O preferred stock dividends payable.

The Company issued 11,584,932 shares of common stock for alternate vesting at a fair value of $1,158.

The Company issued 269,393,920 shares of common stock for settlement of conversion agreements at a fair value of $26,940.

The Company issued 681,197,043 shares of common stock upon conversion of $3,388,000 of preferred stock. The shares were issued within the terms of the agreements and no gain or loss was recognized.

The Company redeemed 810,707,922 shares of common stock at a market price of $0.01 per share in the amount of $81,070.

The Company issued ~~9,321,555~~39,900,514 shares of common stock for the settlement of convertible promissory notes in an aggregate principal ~~in the~~ amount of ~~$485,000,~~$155,300, plus interest in the amount of ~~$107,145, with an~~$115,246, for a total aggregate ~~fair value loss on settlement~~ of ~~$732,826,~~$270,546 based upon a conversion ~~prices~~price of ~~$0.0651 to $0.2205.~~$0.00955.

The Company issued ~~886,700 shares of common stock for the settlement of accounts payable with a fair value of $90,000, with a fair value loss on settlement of $27,931.~~

~~The Company issued 35,734,233~~41,046,848 shares of common stock for services at fair value of ~~$3,418,598.~~$1,054,949, at share prices ranging from $0.0134 - $0.0438.

~~ORIGINCLEAR, INC. AND SUBSIDIARIES~~The Company issued 179,090,390 shares of common stock for settlement of conversion agreements at a fair value of $17,909.

~~SEPTEMBER 30, 2017~~The Company issued 331,043,096 shares of common stock upon conversion of 3,984,347 shares of preferred stock.

On February 17, 2023, the Securities and Exchange Commission qualified the Offering Circular for the offering of securities by WODI pursuant to Regulation A offering (the “Reg A offering”). The Reg A Offering was intended to accumulate capital for WODI to direct toward WOD projects.

On March 9, 2023, the Company announced that it launched a limited preview of the Reg A offering for WODI.

As of June 26, 2023 (the “Termination date”), the Company suspended the sale of securities under the Reg A offering for WODI. As of the Termination Date, 12,000 shares were sold for total proceeds of $60,000.

On September 22, 2023, WODI merged with PWT (See Note 9). Pursuant to the merger:

Upon conversion of the Series A and Series B preferred stock to an aggregate of 1,146,482 shares of WODI common stock. Per the Merger Agreement with PWT, these shares were exchanged for 13,399,217 shares of PWT common stock (See Note 9).

On September 19, 2023, an equity restructuring plan and forward stock-split of 1,000:1 was implemented for PWT common stock. Post forward stock split implementation but before issuing common stock to WODI stockholders in the PWT Merger, the issued and outstanding common shares of PWT were 10,000,000.

On September 21, 2023, WODI merged with PWT (“PWT Merger”). Pursuant to the PWT Merger, all holders of WODI common shares were issued shares in PWT in the following amounts:

As of September 30, ~~2017,~~2023, PWT had 13,399,217 total issued and outstanding shares.

Between May 12, 2016, and January 1, 2022, the Company entered into Restricted Stock Grant Agreements (“the RSGAs”) with its Chief Executive Officer, Riggs Eckelberry, to create management incentives to improve the economic performance of the Company and to increase its value and stock price. All shares issuable under the RSGAs are performance based shares. The RSGAs provides for the issuance of up to an aggregate of 242,109,214 shares of the Company’s common stock to Mr. Eckelberry provided certain milestones are met in certain stages; a) If the Company’s consolidated gross revenue, calculated in accordance with generally accepted accounting principles, consistently applied, equals or exceeds $15,000,000 for the trailing twelve month period as reported in the Company’s quarterly or annual financial statements, the Company will issue up to an aggregate of 121,054,607 shares of its common stock; b) If the Company’s consolidated operating profit (Operating Profit = Operating Revenue - Cost of Goods Sold - Operating Expenses - Depreciation & Amortization), calculated in accordance with generally accepted accounting principles, equals or exceeds $1,500,000 for the trailing twelve month period as reported in the Company’s SEC Reports, the Company will issue up to an aggregate of 121,054,607 shares of its common stock. The Company has not recognized any costs associated with the milestones, because achievement is not probable. As the performance goals are achieved, the shares shall become eligible for vesting and issuance.

Between May 12, 2016, and August 4, 2022, the Company entered into Restricted Stock Grant Agreements (“the BEC RSGAs”) with its members of the Board, employees, and consultants to create management incentives to improve the economic performance of the Company and to increase its value and stock price. All shares issuable under the BEC RSGAs are performance based shares. The BEC RSGAs provide for the issuance of up to 220,686,042 shares of the Company’s common stock to employees and consultants provided certain milestones are met in certain stages; a) If the Company’s consolidated gross revenue, calculated in accordance with generally accepted accounting principles, consistently applied, equals or exceeds $15,000,000 for the trailing twelve month period as reported in the Company’s quarterly or annual financial statements, the Company will issue up to an aggregate of 110,343,021 shares of its common stock; b) If the Company’s consolidated operating profit Operating Profit = Operating Revenue - Cost of Goods Sold - Operating Expenses - Depreciation & Amortization), calculated in accordance with generally accepted accounting principles, equals or exceeds $1,500,000 for the trailing twelve month period as reported as reported in the Company’s SEC reports, the Company will issue up to an aggregate of 110,343,021 shares of its common stock. The Company has not recognized any costs associated with the milestones, because achievement is not probable. As the performance goals are achieved, the shares shall become eligible for vesting and issuance.

On August 14, 2019, the Board of Directors approved an amendment to the RSGAs and BEC RSGAs to include an alternative vesting schedule for the Grantees and on January 26, 2022, the Company amended the procedures for processing the RSGAs and BEC RSGAs. Once a Grantee is eligible to participate in alternate vesting, then they will be added to the list of alternate vestees, enlarging the pool of vestees among which, 10% of stock sales that are allowed under the agreement is divided for the next year. The Company then (i) calculates the value of the Company common stock traded in the year immediately prior to the vesting year, using daily adjusted close and volume, as quoted on the public securities trading market on which the Company’s common stock is then traded (ii) determines the cost basis of the shares, which shall be the closing price quoted on the public securities trading market, quoted on the first trading day of the vesting year which will be the grantee’s cost basis, and (iii) applies the 10% calculation and divides it into the number of qualifying alternate vestees, giving the gross number of shares available to each Grantee. For each alternate vestee for each year in which there occurs a vesting or a potential vesting, the Company (i) does a 90-day lookback from the first day of the latest vesting month, to limit cumulative vesting of shares for each alternate vestee for the 90-day period to 1% of total Company shares of common stock outstanding for the period, using the then current figure for shares outstanding at the time of the lookback; (ii) places the excess shares (the “Overlimit Shares”) in suspense for issuance in the next 90-day period so that in each future 90-day period they may be issued, and (iii) if on the 90-day lookback, cumulative issuances are less than 1% of shares outstanding, the Company will add the shares from previous 90-day lookback, if any. For the avoidance of doubt, the Company will not record any Overlimit Shares as vested until such as time as they have been finally issued. If the fair market value of the Company’s common stock on the date the shares are vested is less than the fair market value of the Company’s common stock on the effective date of the RSGA or BEC RSGA, then the number of vested shares issuable (assuming all conditions are satisfied) shall be increased so that the aggregate fair market value of vested shares issuable on the vesting date equals the aggregate fair market value that such number of shares would have had on the effective date. Upon the occurrence of a Company performance goal, the right to participate in the alternate vesting schedule will terminate, and the vesting of the remaining unvested shares will be as set forth under the restricted stock award agreement. During the nine months ended September 30, 2023, per electing and qualifying under the alternative vesting schedule, the Company issued an aggregate of 2,754,073 shares of Company’s common stock relating to the RSGAs and an aggregate of 8,830,859 shares of Company’s common stock relating to the BEC RSGAs.

During the nine months ended September 30, 2023, the Company issued 4,130,400 purchase warrants, associated with the preferred stocks. A summary of the Company’s warrant activity and related information follows for the nine months ended September 30, 2023:

At September 30, 2023, the weighted average remaining contractual life of warrants outstanding:

The derivative liability recognized in the financial statements for the warrants as of September 30, 2023 was $436,071.

At September 30, 2023, the aggregate intrinsic value of the warrants outstanding was $0.

As of September 30, 2023, the outstanding convertible promissory notes are summarized as follows:

Maturities of long-term debt for the ~~$3,667,068 in~~next three years are as follows:

On various dates from November 2014 through April 2015, the Company issued unsecured convertible promissory notes ~~has a remaining debt discount of $289,718, leaving a net balance of $3,377,350.~~

~~On various dates, the Company entered into unsecured convertible notes~~ (the ~~“Convertible Promissory~~“2014-2015 Notes” ~~or “Notes”~~), that matured ~~during the period~~on various dates and were extended for an additional sixty (60) ~~days~~months from the effective date of each Note. The 2014-2015 Notes bear interest at 10% per ~~annum.~~year. The maturity dates were extended to November 2023 through April 2024. The 2014-2015 Notes may be converted into shares of the Company’s common stock at conversion prices ranging from the lesser of ~~$2.10~~$4,200 to ~~$4.90~~$9,800 (subject to adjustment for stock splits, dividends, combinations and other similar transactions) or 50% of the lowest trade price on any trade day following issuance of the 2014-2015 Notes. In addition, for as long as the 2014-2015 Notes or other convertible notes in effect between the purchaser and the Company are outstanding, if the Company issues any security with terms more favorable than the terms of the 2014-2015 Notes or such other convertible notes or a term was not similarly provided to the purchaser of the 2014-2015 Notes or such other convertible notes, then such more favorable or additional term shall, at the purchaser’s option, become part of the 2014-2015 Notes and such other convertible notes. The conversion feature of the 2014-2015 Notes was considered a derivative in accordance with current accounting guidelines because of the reset conversion features of the 2014-2015 Notes. During the nine months ended September 30, ~~2017,~~2023, the Company has issued ~~9,321,555~~55,788,402 shares ~~of common stock,~~ upon conversion of ~~$395,000~~principal in ~~principal,~~the amount of $91,000, plus accrued interest of ~~$107,145, with a fair value loss on settlement of $732,826.~~$76,365. As of September 30, ~~2017,~~2023, the 2014-2015 Notes had an aggregate remaining balance of ~~$1,560,000.~~$683,700 of which $615,000, is short term and $68,700 is long term.

~~As of September 30, 2017,~~The unsecured convertible promissory notes (the “OID Notes”) had an aggregate remaining ~~principal~~ balance of $184,124, plus accrued interest of ~~$13,334 were amended.~~$13,334. The OID Notes included an original issue discount and ~~one time~~one-time interest, which has been fully amortized. The OID Notes matured on June 30, 2023, which were extended ~~through December 31, 2017.~~to June 30, 2028. The OID Notes were convertible into shares of the Company’s common stock at a conversion price initially of ~~$15.31.~~$30,620. After the amendment, the conversion price changed to the lesser of ~~$2.80~~$5,600 per share, or b) fifty percent (50%) of the lowest trade price of common stock recorded since the original effective date of this note, or c) the lowest effective price per share granted to any person or entity after the effective date. The conversion feature of the ~~notes~~OID Notes was considered a derivative in accordance with current accounting guidelines, because of the reset conversion features of the ~~notes.~~OID Notes. There was a change in the OID Note to accrue interest on a monthly basis. As of September 30, 2023, the remaining balance on the OID Notes was $62,275, which is long term.

The Company ~~entered into~~issued various, unsecured convertible promissory notes (the ~~“Notes”~~“2015 Notes”), on various dates ~~ending on May 19, 2016.~~with the last of the 2015 Notes being issued in August 2015. The 2015 Notes matured and were extended from the date of each tranche through maturity dates ending on ~~May 19, 2020.~~February 2024 through March 2024, and April 2024 through August 2024. The 2015 Notes bear interest at 10% per ~~annum.~~year. The 2015 Notes ~~may be converted~~are convertible into shares of the Company’s common stock at conversion prices ranging from the lesser of ~~$0.70~~$1,400 to ~~$2.80~~$5,600 (subject to adjustment for stock splits, dividends, combinations and other similar transactions) or 50% of the lowest trade price on any trade day following issuance of the 2015 Notes. The conversion feature of the 2015 Notes was considered a derivative in accordance with current accounting guidelines because of the reset conversion features of the 2015 Notes. ~~The~~As of September 30, 2023, the 2015 Notes had an aggregate remaining balance of ~~the note as of September 30, 2017, was $1,325,000. The Company recorded amortization of debt discount,~~$1,200,000, which ~~was recognized as interest expense in the amount of $11,479 during the nine months ended September 30, 2017.~~is short term.

The Company issued a convertible note (the “Dec 2015 Note”) in exchange for an accounts payable in the amount of $432,048, which could be converted into shares of the Company’s common stock after December 31, 2015. The ~~note~~Dec 2015 Note was accounted for under ASC 470, whereby, a beneficial conversion feature was recorded at time of issuance. The ~~note~~Dec 2015 Note did not meet the criteria of a derivative, and was accounted for as a beneficial conversion feature, which was amortized over the life of the ~~note~~Dec 2015 Note and recognized as interest expense in the financial statements. On January 1, 2016, the ~~note~~Dec 2015 Note met the criteria of a derivative and was accounted for under ASC 815. The ~~note~~Dec 2015 Note has zero stated interest rate, and the conversion price shall be equal to 75% of the average three lowest last sale prices traded during the 25 trading days immediately prior to conversion. As of ~~December 31, 2016,~~September 30, 2023, the remaining balance on the Dec 2015 Note was $257,048. During the nine months ended September 30, 2017, the Company issued 886,700 shares of common stock upon conversion of principal in the amount of $90,000, with a fair value loss on settlement of $27,931. As of September 30, 2017, the Note had a remaining balance of $167,048. The Company recorded amortization of debt discount,$167,048, which ~~was recognized as interest expense in the amount of $161,574 during the nine months ended September 30, 2017.~~is short term.

The Company issued a convertible note (the “Sep 2016 Note”) in exchange for an accounts payable in the amount of $430,896, which could be converted into shares of the Company’s common stock after September 15, 2016. The ~~note~~Sep 2016 Note was accounted for under ASC 470, whereby, a beneficial conversion feature was recorded at time of issuance. ~~On September 15,~~The Sep 2016 ~~the note~~Note met the criteria of a derivative and was accounted for under ASC 815. The ~~note~~Sep 2016 Note has zero stated interest rate, and the conversion price shall be equal to 75% of the average three lowest last sale prices traded during the 25 trading days immediately prior to conversion. The ~~note~~Sep 2016 Note did not meet the criteria of a derivative at the ~~time it was entered into,~~date of the issuance, and was accounted for as a beneficial conversion feature, which was amortized over the life of the ~~note~~Sep 2016 Note and recognized as interest expense in the financial statements. The conversion feature of the Sep 2016 Note was considered a derivative in accordance with current accounting guidelines because of the reset conversion feature of the Sep 2016 Note. As of September 30, 2023, the remaining balance on the Sep 2016 Note was $430,896, which is short term.

The Company issued two (2) unsecured convertible promissory notes (the “Apr & May 2018 Notes”), in the aggregate amount of $300,000 on April 2, 2018 and May 31, 2018. The Apr & May 2018 Notes had maturity dates of April 2, 2019 and May 31, 2019, respectively. The Apr & May 2018 Notes bear interest at 10% per year. The Apr & May 2018 Notes may be converted into shares of the Company’s common stock at a variable conversion price of 50% of the lesser of the lowest trading price twenty-five (25) trading days prior to conversion. The conversion feature of the Apr & May 2018 Notes was considered a derivative in accordance with current accounting guidelines because of the reset conversion features of the Notes. On March 13, 2019, the Company entered into a settlement agreement with the investor in the amount of $570,000, based on the outstanding balance due and payable under the Apr & May 2018 Notes. The Company set up a reserve of 2,630,769 shares of common stock of the Company for issuance upon conversion by the investor of the amounts owed under the Notes, in accordance with the terms of the Notes, including, but not limited to the beneficial ownership limitations contained in the Notes. In addition to the foregoing, upon the sale by the investor of the settlement shares as delivered to the investor by the Company, resulting in total net proceeds less than the settlement value, the investor is entitled to additional settlement shares of the Company’s common stock. If after the investor has sold all settlement shares, the investor delivers a written notice to the Company certifying that the investor is entitled to additional settlement shares of the Company’s common stock (the “Make-Whole Shares”). The number of make-whole shares being equal to the greater of ((i) zero and (ii) the quotient of (1) the difference of (x) the settlement value with respect to each sale of shares by the Investor after the delivery of the Settlement Shares, minus (y) the aggregate net consideration received by the Investor from the resale of all shares of common stock issued by the Company, divided by (2) the average trailing closing price for ten (10) trading days for the shares immediately preceding the date of delivery of the make-whole shares. During the period the Company wrote off the loan and recorded a gain on the write-off of the note payable. As of September 30, 2023, there was no remaining balance.

The Company entered into an unsecured convertible promissory note (the “Nov 20 Note”), on November 19, 2020 in the amount of $50,000. The Company received funds in the amount of $50,000. The Nov 20 Note had an original maturity date of November 19, 2021 and was extended for an additional sixty (60) months from the maturity date. The Nov 20 Note bears interest at 10% per year. The Nov 20 Note may be converted into shares of the Company’s common stock at a lesser price of $0.05 per share or (b) fifty percent (50%) of the lowest trade price of common stock recorded on any trade after the effective date, or (c) the lowest effective price per share granted. In addition, for each conversion, in event that shares are not delivered by the fourth business day (inclusive of the day of conversion), a penalty of $2,000 per day shall be assessed for each day after the third business day until the shares are delivered. The conversion feature of the Nov 20 Note was considered a derivative in accordance with current accounting guidelines because of the reset conversion features of the Note. As of September 30, 2023, the remaining balance on the Nov 20 Note was $13,772, which is long term.

The Company entered into an unsecured convertible promissory note (the “Jan 21 Note”), on January 25, 2021 in the amount of $60,000. The Company received funds in the amount of $60,000. The Jan 21 Note had an original maturity date of January 25, 2022 and was extended for an additional sixty (60) months from the maturity date. The Jan 21 Note bears interest at 10% per year. The Jan 21 Note may be converted into shares of the Company’s common stock at a conversion price equal to the lower of (a) $0.05 per share, (b) fifty percent (50%) of the lowest trade price of common stock recorded on any trade after the effective date, or (c) the lowest effective price per share granted. In addition, for each conversion, in event that shares are not delivered by the fourth business day (inclusive of the day of conversion), a penalty of $2,000 per day shall be assessed for each day after the third business day until the shares are delivered. The conversion feature of the Jan 25 Note was considered a derivative in accordance with current accounting guidelines because of the reset conversion features of the Note. The Company recorded amortization of debt discount, which was recognized as interest expense in the amount of ~~$140,543~~$3,743 during the ~~nine months~~year ended December 31, 2022. As of September 30, ~~2017.~~2023, the balance of the Jan 21 Note was $60,000, which is short term.

We evaluated the financing transactions in accordance with ASC Topic 815, Derivatives and Hedging, and determined that the conversion feature of the convertible promissory notes was not afforded the exemption for conventional convertible instruments due to its variable conversion rate. The note has no explicit limit on the number of shares issuable, so they did not meet the conditions set forth in current accounting standards for equity classification. The Company elected to recognize the note under paragraph 815-15-25-4, whereby, there would be a separation into a host contract and derivative instrument. The Company elected to initially and subsequently measure the note in its entirety at fair value, with changes in fair value recognized in earnings. The Company recorded a derivative liability representing the imputed interest associated with the embedded derivative. The derivative liability is adjusted periodically according to the stock price fluctuations.

The derivative liability recognized in the financial statements for the convertible promissory notes as of September 30, ~~2017~~2023 was ~~$10,728,464.~~$10,381,519.

In December 2022, WODI raised capital and issued convertible secured promissory notes in the ~~Board~~amount of ~~Directors adopted a new OriginOil, Inc. 2012 Incentive Stock Option Plan~~$1,347,500 to investors with 10% interest per annum. The notes were issued to raise capital needed to acquire the equity interests in Fortune Rise Acquisition Corporation (the ~~“2012 Plan”~~“SPAC”) for the ~~purposes~~purchase price of ~~granting stock options~~$400,000 and to ~~its employees~~pay off the promissory notes the SPAC owed to sellers. Per the terms and ~~others providing services to~~conditions of the ~~Company, which reserves~~convertible promissory notes, all unpaid principal, together with any unpaid and ~~sets aside for the granting of options for 28,571 shares of common stock. Options granted under these plans may be either incentive options or nonqualified options and~~accrued interest shall be ~~administered by~~due and payable on the Company’s Board of Directors. Each option shall be exercisable to the nearest whole share, in installments or otherwise, as the respective option agreements may provide. Notwithstanding any other provisionearlier of the 2012 Plan or of any option agreement, each option shall expire on the date specified in the option agreement, which date shall not be later than the tenth (10th) anniversary from the effective date of grant.

On June 14, 2013, the Board of Directors adopted a new OriginOil, Inc. 2013 Incentive Stock Option Plan (the “2013 Plan”) for the purposes of granting stock options to its employees and others providing services to the Company, which reserves and sets aside for the granting of options for 114,286 shares of common stock. Options granted under the Plan may be either incentive options or nonqualified options and shall be administered by the Company’s Board of Directors. Each option shall state the number of shares to which it pertains. The exercise price will be determined by the holders’ percentage owned as follows: If the holder owns more than 10% of the total combined voting power or value of all classes of stock of the Company, then the exercise price will be no less than 110% of the fair market value of the stock astwelve (12) month of the date of ~~grant; if~~ the person is not a 10% holder, then the exercise price will be no less than 100% of the fair market value of the stock as of the date of grant. Notwithstanding any other provision of the 2013 Plan or of any option agreement, each option shall expire on the date specified in the option agreement, which date shall not be later than the tenth (10th) anniversary from the date of grant. If the status of an employee terminates for any reason other than disability or death, then the optionee or their representativeNotes (the “Maturity Date”) provided, that WODI shall have the ~~right~~option to ~~exercise~~extend the ~~portion~~Maturity Date for up to two (2) six-month extensions, or (ii) when, upon the occurrence and during the continuance of ~~any options which were exercisable as~~an event of ~~the date of such termination, in whole or in part, not less than 30 days nor more than three (3) months after such termination.~~

On September 29, 2015, the Board of Directors adopted a new OriginClear, Inc. 2015 Equity Incentive Stock Option Plan (the “2015 Plan”) for the purposes of granting stock options to its employees and others providing services to the Company, which reserves and sets aside for the granting of options for 3,315,714 shares of common stock. On October 2, 2015, the Board of Directors amended the number of shares to reserve for issuance to 4,571,429 shares. Options granted under these plans may be either incentive options or nonqualified options and shall be administered by the Company’s Board of Directors. Each option shall be exercisable to the nearest whole share, in installments or otherwise, as the respective option agreements may provide. Notwithstanding any other provision of the 2015 Plan or of any option agreement, each option shall expire on the date specified in the option agreement, which date shall not be later than the fifth (5th) anniversary from the effective date of grant.default.

During the year ended December 31, 2016, the Company granted 31,429 shares of incentive stock options to employees, and 428,571 shares of non-statutory options to consultants. Each option shall be exercisable to the nearest whole share, in installments or otherwise, as the respective option agreements may provide. The stock options mature on March 29, 2021 and October 17, 2021, at prices of $0.29 and $1.31.

With respect to Non-Statutory Options granted to employees, directors or consultants, the Board of Directors or Committee of the Board of Directors may specify such period for exercise that the option shall automatically terminate following the termination of employment or services as to shares covered by the option as the Board of Directors or Committee of the Board of Directors deems reasonable and appropriate.

~~A summary of the Company’s stock option activity and related information follows:~~

~~The weighted average remaining contractual life of options outstanding issued under the 2009 Plan, 2012 Plan, and 2013 Plan as of September 30, 2017 was as follows:~~

Stock-based compensation expense recognized during the year is based on the value of the portion of stock-based payment awards that is ultimately expected to vest. Stock-based compensation expense recognized in the financial statements of operations during the nine months ended September 30, ~~2017~~2023, WODI raised additional capital of $6,346,500 and ~~2016 were $71,603~~an investor exchanged the Company’s Series X preferred stock in the amount of $250,000 and ~~$155,112, respectively.~~

AsSeries R preferred stock in the amount of $100,000 for a WODI convertible secured promissory note. Also during the period ended September 30, ~~2017, there was no intrinsic value~~2023, per settlement, conversion and redemption agreements with ~~regards to the outstanding options.~~

On May 12, 2016, the Company entered into a Restricted Stock Grant Agreement (the “RSGA”) with its Chief Executive Officer, Riggs Eckelberry, to create management incentives to improve the economic performanceWODI shareholders, an aggregate of the Company and to increase its value and stock price. All shares issuable under the RSGA are performance based shares and none have yet vested nor have any been issued. The RSGA provides for the issuance of up to 1,714,286810,707,922 shares of the Company’s common stock were redeemed at a market price of $0.01, which was added to the ~~Employees provided certain milestones~~cash value of the shareholders’ investment to purchase WODI convertible secured promissory notes. The loss relating to these settlement and conversion agreements of $7,728,089 was accounted for in the consolidated statements of operations. As of September 30, 2023, WODI had outstanding convertible secured promissory notes in the amount of $15,772,089.

Revenues and related costs on equipment contracts are ~~met in certain stages; a) If~~recognized as the ~~Company’s consolidated gross revenue, calculated~~performance obligations for work are satisfied over time in accordance with ~~generally accepted accounting principles, consistently applied, equals or exceeds $15,000,000 for~~Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. Under ASC 606, revenue and associated profit will be recognized as the ~~trailing twelve month period as reported~~customer obtains control of the goods and services promised in the ~~Company’s quarterly or annual financial statements,~~contract (i.e., performance obligations). All un-allocable indirect costs and corporate general and administrative costs are charged to the periods as incurred. However, in the event a loss on a contract is foreseen, the Company will ~~issue up~~recognize the loss as it is determined.

The following table represents a disaggregation of revenue by type of good or service from contracts with customers for the nine months ended September 30, 2023.

Revenue recognition for other sales arrangements, such as sales for components, and service sales will remain materially consistent.

Contract assets represents revenues recognized in excess of amounts billed on contracts in progress. Contract liabilities represents billings in excess of revenues recognized on contracts in progress. Assets and liabilities related to ~~857,143~~long-term contracts are included in current assets and current liabilities in the accompanying balance sheets, as they will be liquidated in the normal course of the contract completion. The contract asset for the nine months ended September 30, 2023 and the year ended December 31, 2022, was $908,327 and $1,479,491, respectively. The contract liability for the nine months ended September 30, 2023 and the year ended December 31, 2022, was $1,271,095 and $932,458, respectively.

On November 12, 2021, the Company served a conversion notice to WTII and recorded additional interest and fees of $15,988 through that date, according to the terms of the securities purchase agreement for an aggregate of $149,867. The Note was converted into 45,208,649 shares of ~~its~~WTII common ~~stock; b) If~~stock. As of September 30, 2023, the ~~Company’s consolidated operating profit (~~~~Operating Profit = Operating Revenue - Cost of Goods Sold - Operating Expenses - Depreciation & Amortization),~~~~calculated~~investment in ~~accordance with generally accepted accounting principles, equals or exceeds $1,500,000 for the trailing twelve month period as reported as reported~~securities was recorded at fair value in the ~~Company’s SEC Reports, the Company will issue up to 857,143 shares~~amount of its common stock. The Company has not recognized any costs associated with the milestones, due to not being able to estimate the probability of it being achieved. As the performance goals are achieved, the shares shall become eligible for vesting and issuance.

On August 10, 2016, the Company entered into a Restricted Stock Grant Agreement (the “August RSGA”) with its Chief Executive Officer, Riggs Eckelberry, to create management incentives to improve the economic performance of the Company and to increase its value and stock price. All shares issuable under the August RSGA are performance based shares and none have yet vested nor have any been issued. The August RSGA provides for the issuance of up to 1,714,286 shares of the Company’s common stock to the CEO provided certain milestones are met in certain stages; a) If the Company’s consolidated gross revenue, calculated in accordance with generally accepted accounting principles, consistently applied, equals or exceeds $15,000,000 for the trailing twelve month period, the Company will issue up to 857,143 shares of its common stock; b) If the Company’s consolidated operating profit (~~Operating Profit = Operating Revenue - Cost of Goods Sold - Operating Expenses - Depreciation & Amortization),~~calculated in accordance with generally accepted accounting principles, equals or exceeds $1,500,000 for the trailing twelve month period as reported as reported in the Company’s SEC Reports, the Company will issue up to 857,143 shares of its common stock. The Company has not recognized any costs associated with the milestones, due to not being able to estimate the probability of it being achieved. As the performance goals are achieved, the shares shall become eligible for vesting and issuance.

~~On May 12, 2016, the Company entered into a Restricted Stock Grant Agreement (the “First Employee RSGA”)~~$22,604, with an ~~employee, to create management incentives to improve the economic performance~~unrealized loss of the Company and to increase its value and stock price. All shares issuable under the First Employee RSGA are performance based shares and none have yet vested nor have any been issued. The First Employee RSGA provides for the issuance of up to 857,143 shares of the Company’s common stock to the employee provided certain milestones are met in certain stages; a) If the Company’s consolidated gross revenue, calculated in accordance with generally accepted accounting principles, consistently applied, equals or exceeds $15,000,000 for the trailing twelve month period as reported in the Company’s quarterly or annual financial statements, the Company will issue up to 428,571 shares of its common stock; b) If the Company’s consolidated operating profit (~~Operating Profit = Operating Revenue - Cost of Goods Sold - Operating Expenses - Depreciation & Amortization),~~calculated in accordance with generally accepted accounting principles, equals or exceeds $1,500,000 for the trailing twelve month period as reported as reported in the Company’s SEC Reports, the Company will issue up to 428,571 shares of its common stock. The Company has not recognized any costs associated with the milestones, due to not being able to estimate the probability of it being achieved. As the performance goals are achieved, the shares shall become eligible for vesting and issuance.$4,521.

On May ~~12, 2016,~~15, 2018, the Company received 4,000 shares of WTII Series C convertible preferred stock for the use of OriginClear, Inc. technology associated with their proprietary electro water separation system. Each share of Series C convertible preferred stock is convertible into one thousand (1,000) shares of WTII common stock. The stock was valued at fair market value of $0.0075 for a price of $30,000 on the date of issuance. The Company analyzed the licensing agreement using ASU 606 to determine the timing of revenue recognition. The licensing of the intellectual property (IP) is distinct from the non-license goods or services and has significant standalone functionality that provides a benefit or value. The functionality will not change during the license period due to the licensor’s activities. Because the significant standalone functionality was delivered immediately, the revenue was recognized in the financial statements as of June 30, 2018. As of September 30, 2023, the fair value of the preferred shares was $3,200, and had a gain in fair value of $800.

The Company entered into short term loans with various lenders for capital expansion secured by the Company’s assets in the amount of $1,749,970, which included finance cost of $624,810. The finance cost was amortized over the terms of the loans, which have various maturity dates ranging from October 2018 through February 2019. As of December 31, 2020, the finance cost was fully amortized. The term of the loans ranged from two months to six months. The net balance as of September 30, 2023 was $30,646.

Water On Demand, Inc. (“WODI”) was incorporated in the state of Nevada on April 22, 2022. WODI, with the support of its parent, OriginClear, Inc (the “Company”), is developing a new outsourced water treatment business called “Water On Demand”: or “WOD”. The WOD model intends to offer private businesses the ability to pay for water treatment and purification services on a per-gallon basis. This is commonly known as Design-Build-Own-Operate or “DBOO”. WODI intends to work with regional water service companies to build and operate the water treatment systems it finances. On March 23, 2022, WODI announced that it was evaluating the first pilot opportunity, a 50,000 gallon per day wastewater treatment project.

On November 16, 2022, WODI filed a Form 1-A Offering Circular for an offering under Regulation A (the “Offering”) of the Securities Act of 1933 with the U.S. Securities and Exchange Commission. The purpose of the Offering is to allow potential investors the opportunity to invest directly in WODI. The Offering has a minimum investment of $1,000 and will be on a best-efforts basis.

On December 22, 2022, WODI entered into a Membership Interest Purchase and Transfer Agreement (the “Purchase Agreement”) with Ka Wai Cheung, Koon Lin Chan, and Koon Keung Chan (each a “Seller”, and collectively, the “Sellers”) and Fortune Rise Sponsor LLC, a Delaware limited liability company (the “Sponsor”), pursuant to which WODI purchased 100 membership interests in the Sponsor (“Purchased Interests”) from the Sellers, which constitutes 100% of the membership interests in the Sponsor. The Sponsor owns 2,343,750 shares out of 2,443,750 shares of the issued and outstanding shares of Class B common stock (the “Class B Common Stock”) of Fortune Rise Acquisition Corporation, a Delaware Corporation (“FRLA” or the “SPAC”). On December 29, 2022, the Company announced that its subsidiary, Water On Demand, Inc. had closed its acquisition of Fortune Rise Sponsor, LLC, which is the sponsor of Fortune Rise Acquisition Corp.

On December 22, 2022, WODI paid a total of $1,137,267 to the Sellers of Fortune Rise Sponsor, LLC which included a total of $400,000 to purchase the membership interest in Class B Common Stock of FRLA and $737,267 for compensating the payment made by the Sellers on November 4, 2022, towards the first extension of the SPAC through February 5, 2023. In connection with the Extension Payment, FRLA issued unsecured promissory notes to the Sellers. As of December 31, 2022, the $737,267 amount was reflected as Notes Payable to related party on the consolidated balance sheet of the SPAC.

FRLA is a blank check company incorporated in February 2021 as a Delaware corporation formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. FRLA is a “shell company” as defined under the Exchange Act of 1934, as amended, because it has no operations and nominal assets consisting almost entirely of cash. The SPAC will not generate any operating revenues until after the completion of its initial business combination, at the earliest.

On December 29, 2022, pursuant to a Membership Interest Purchase and Transfer Agreement and Securities Transfer Agreement with the members of the Sponsor, WODI acquired the membership interests of the Sponsor and became the beneficial owner of 2,343,750 shares of FRLA Class B Common Stock, each of which is exercisable into one share of FRLA Class A Common Stock. The purchase price for the membership interests was $400,000. To acquire the equity interests in FRLA for the purchase price of $400,000, WODI issued convertible secured promissory notes to investors at 10% interest per annum. Per the terms and conditions of the convertible promissory note, all unpaid principal, together with any unpaid and accrued interest shall be due and payable on the earlier of the twelve (12) month of the date of the Note (the “Maturity Date”) (provided, WODI shall have the option to extend the Maturity Date for up to two (2) six-month extensions, or (ii) when, upon the occurrence and during the continuance of an Event of Default.

On January 5, 2023, WODI signed a non-binding Letter of Intent (the “LOI”) with Fortune Rise Acquisition Corporation, (“FRLA” collectively with WODI, the “Parties”). The LOI is not binding on the Parties and is intended solely to guide good-faith negotiations toward a definitive business combination agreement. The Parties will work together in good faith with their respective advisors to agree on a structure for the business combination that is most expedient to the consummation of the acquisition, which may result in a new (merged) entity. Pursuant to the LOI, if a business combination were to be consummated and approved, all of the outstanding equity securities of WODI, including all shares of common stock, preferred stock, outstanding options and warrants will convert into new equity of the merged entity.

On February 7, 2023, FRLA and OriginClear Inc. announced that WODI deposited $977,500 (the “Second Extension Payment”) into FRLA’s trust account for its public shareholders, representing $0.10 per public share, which enables FRLA to extend the period of time it has to consummate its initial business combination by an additional three months from February 5, 2023 to May 5, 2023 (the “Second Extension”).

WODI assumed the obligation to make any necessary extension payments in connection with the extension of the period of time in which the SPAC may consummate its initial business combination as described in the SPAC’s S-1 Registration Statement, including the three-month extension from November 5, 2022 to February 5, 2023, the Second Extension for an additional three months from February 5, 2023 to May 5, 2023 and a final extension for an additional six months from May 5, 2023 to November 5, 2023.

On April 10, 2023, at the Special Meeting, a total of 10,514,410 (or 81.61%) of FRLA’s issued and outstanding shares of Class A common stock and Class B common stock held of record as of March 3, 2023, were present either in person or by proxy, which constituted a quorum. In that FRLA shareholders agreed to an extension of the period of time it has to consummate its initial business combination by an additional six months from May 5, 2023 to November 5, 2023. FRLA’s stockholders voted on to approve and adopt the extension amendment which received sufficient votes (more than 65%) for approval.

On April 14, 2023, WODI entered into an Asset Purchase Agreement with the Company, whereby it agreed to purchase all of the assets related to the Company’s “Modular Water Service” business, including licenses, technology, intellectual property, contracts, business models, patents and other assets in exchange for 6,000,000 shares of WODI common stock. The assets include a reissuance for a new ten-year term of OriginClear’s existing global master license to the five patents and related Intellectual Property of inventor Daniel M. Early, P.E., who heads Modular Water, and the right to file patents for all additional inventions since 2018, when OriginClear created the unit. MWS is in commercial operation and operates as a division of WODI. On April 14, 2023, the Company transferred the assets associated with its Modular Water Systems division (“MWS” or “Modular Water”) (www.modularwater.com) to WODI.

On September 21, 2023, WODI entered into a merger agreement with PWT whereby WODI was merged with PWT. The merger of these entities was completed to create better enterprise value for a potential merger opportunity with FRLA. In connection with the merger with WODI, PWT changed its name to Water on Demand, Inc.

On September 28, 2023, WODI nominated the combined PWT/WODI merged entity, for merger with FRLA. Accordingly, the Letter of Intent (“LOI”) executed on January 5, 2023 with WODI was amended to designate PWT as the new target of the acquisition. Under the amended LOI, FRLA proposed to acquire all the outstanding securities of PWT, based on certain material financial and business terms and conditions being met. The LOI is not binding on the parties and is intended solely to guide good-faith negotiations toward definitive agreements.

On October 24, 2023 FRLA and WODI entered into a definitive business combination agreement (the “BCA”). The transaction represents a pro forma equity valuation of approximately $72 million of the Combined Company, assuming no further redemptions of FRLA public shares by FRLA’s public shareholders. The estimated cash proceeds available to the Combined Company from the transaction consists of FRLA’s $ 39,635,883 of cash held in trust, assuming no further redemptions of FRLA public shares. Upon closing of the transactions contemplated under the BCA, and assuming none of FRLA’s public shareholders elect to redeem their shares of common stock and no additional shares of common stock are issued, it is anticipated that FRLA’s public shareholders would retain an ownership interest of approximately 46% of the Combined Company, the sponsors, officers, directors and other holders of FRLA founder shares and private shares will retain an ownership interest of approximately 18% of the Combined Company, and the WOD stockholders will own approximately 36% of the Combined Company, based on its agreed acquisition valuation of $32 million, an approximate 3.2x multiple of its 2022 revenue. The existing stockholders of WOD are expected to roll 100% of their equity into the Combined Company.

On October 25, 2023, at the Special Meeting, a total of 5,687,847 (or 84.59 %) of FRLA’s issued and outstanding shares of Class A common stock and Class B common stock held of record, were present either in person or by proxy, which constituted a quorum. FRLA shareholders approved a proposal to extend the period of time FRLA has to consummate its initial business combination by an additional one year from November 5, 2023 to November 5, 2024, by up to twelve one-month extensions, subject to certain conditions.

Since buying the sponsorship interest in the SPAC on December 22, 2022 through September 30, 2023, WODI and the Company made payments on behalf of the SPAC in the aggregate amount of $3,260,985. As of September 30, 2023, WODI and the Company received an aggregate of $3,260,985 in unsecured promissory notes (the “SPAC Notes”) from the SPAC in exchange for the payments made on behalf of the SPAC to meet its operating expenses and the extension payments. The SPAC Notes are non-interest bearing and payable (subject to the waiver against SPAC trust provisions) on the earlier of (i) consummation of the SPAC initial business combination; and (ii) the date of the liquidation of the SPAC. The principal balance of each SPAC Note may be prepaid at any time, at the election of the SPAC.

As of the date of this filing, the SPAC has been extended through November 5, 2024, to give the Company adequate time to complete all the necessary administrative and regulatory steps, including filing of the registration statement and timely respond to satisfy potential comments, from regulatory bodies to consummate the business combination. Management continues to estimate the likelihood of the merger at 50%.

Although the payments made on behalf of the SPAC are amounts receivable to WODI, for the period ended September 30, 2023, WODI considered the aggregate amount of $3,260,985 for the SPAC Notes to be impaired and recorded it as an expense on the consolidated income statements, as it is deemed probable that the SPAC may not have funds to pay back with interest all of the Class A shareholders and WODI for the amounts advanced to the SPAC.

In the event of WODI successfully merging with the SPAC, all amounts paid by WODI on behalf of the SPAC, including any future payments made until such merger is fully consummated will be received back by WODI.

On April 14, 2023 (the “Effective Date”), WODI entered into an Asset Purchase Agreement with the Company, whereby it agreed to purchase all of the assets related to the Company’s Modular Water Systems (“MWS”) business, including licenses, technology, intellectual property, contracts, business models, patents and other assets in exchange for 6,000,000 shares of WODI common stock. The assets included MWS accounts receivables and accounts payables as of April 14, 2023 and an assignment of the Company’s existing global master license to the patents of inventor Daniel M. Early, P.E., who heads MWS, and the right to file patents for all additional inventions since 2018, when OriginClear created the MWS unit. Beginning on the Effective Date, all MWS transactions including revenue, accounts payable and accounts receivable were transferred from the Company’s Progressive Water Treatment, Inc. (“PWT”) subsidiary over to the Company’s WODI subsidiary.

On September 21, 2023, WODI entered into a merger agreement with PWT to create better enterprise value for a potential merger opportunity with FRLA and a plan of merger agreement (the “PWT-WODI merger agreement”) was entered into between WODI and PWT. Per the PWT-WODI merger agreement, all shares of WODI common and preferred stock were exchanged for 2,406,822 shares of PWT common stock as merger consideration. WODI convertible notes and WODI Restricted Stock Grants were assumed by PWT and remain outstanding.

The merger consideration of 2,406,822 shares of common stock of PWT were calculated as follows:

Between August 12, 2022, and August 3, 2023, WODI entered into Restricted Stock Grant ~~Agreement~~Agreements (the ~~“Second Employee RSGA”~~“WODI RSGAs”) with ~~an employee, to create management incentives to improve the economic performance~~its members of the ~~Company~~Board, employees, and to increase its value and stock price. All shares issuable under the Second Employee RSGA are performance based shares and none have yet vested nor have any been issued. The Second Employee RSGA provides for the issuance of up to 571,429 shares of the Company’s common stock to the employee provided certain milestones are met in certain stages; a) If the Company’s consolidated gross revenue, calculated in accordance with generally accepted accounting principles, consistently applied, equals or exceeds $15,000,000 for the trailing twelve month period as reported in the Company’s quarterly or annual financial statements, the Company will issue up to 285,714 shares of its common stock; b) If the Company’s consolidated operating profit (~~Operating Profit = Operating Revenue - Cost of Goods Sold - Operating Expenses - Depreciation & Amortization),~~calculated in accordance with generally accepted accounting principles, equals or exceeds $1,500,000 for the trailing twelve month period as reported as reported in the Company’s SEC Reports, the Company will issue up to 285,714 shares of its common stock. The Company has not recognized any costs associated with the milestones, due to not being able to estimate the probability of it being achieved. As the performance goals are achieved, the shares shall become eligible for vesting and issuance.

~~On August 10, 2016, the Company entered into a Restricted Stock Grant Agreement (the “Consultants RSGA”) with two of its’~~ consultants to create management incentives to improve the economic performance of ~~the Company~~WODI and to increase its value and stock price. All shares issuable under the Consultants RSGA are performance based shares and none have yet vested nor have any been issued. The Consultants RSGA provides to each of the consultantsvalue. WODI RSGAs provide for the issuance of up to ~~285,714~~15,550,000 shares of ~~the Company’s~~WODI common stock provided certain milestones and vesting are met in certain ~~stages; a)~~stages. The restricted shares may become fully vested and no longer subject to risk of forfeiture (“Vested Shares”) if WODI shares are uplisted to a National Exchange, then upon such uplisting, 25% of the restricted shares that shall vest and become Vested Shares and 6.25% each three-month period thereafter, subject to the following: (i) If WODI shares are traded on a National Exchange, then the ~~Company’s consolidated gross revenue, calculated~~amount of restricted shares which shall become Vested Shares during any three-month period shall not exceed an amount representing the greater of (a) 1% of the shares of common stock outstanding as shown by the most recent SEC Report published by WODI and (b) the average weekly reported volume of trading in ~~accordance with generally accepted accounting principles, consistently applied, equals or exceeds $15,000,000 for~~ the ~~trailing twelve~~common stock on a national securities exchange during the previous four calendar weeks. (ii) If WODI shares are subsequently delisted and quoted on the over-the-counter market, including the OTCQB, then the amount of restricted shares which shall become Vested Shares during any three month period ~~the Company will issue to each~~shall not exceed an amount representing 1% of the ~~consultants up to 142,857~~ shares of ~~its~~ common ~~stock; b) If~~stock outstanding as shown by the ~~Company’s consolidated operating profit (~~~~Operating Profit = Operating Revenue - Cost~~most recent SEC Report published by WODI, or if WODI shares are traded on a national securities exchange, the greater of ~~Goods Sold - Operating Expenses - Depreciation & Amortization),calculated in accordance with generally accepted accounting principles, equals or exceeds $1,500,000 for~~(b)(i) and the ~~trailing twelve month period as~~average weekly reported ~~as reported~~volume of trading in the ~~Company’s SEC Reports,~~common stock on a national securities exchange during the ~~Company will issue up to 142,857~~previous four calendar weeks. If WODI shares ~~to each~~do not achieve listing on a national securities exchange within three years of the ~~consultants, its common stock. The Company~~Effective Date, then the restricted shares shall vest and become Vested Shares at a rate equal to 25% on the three-year anniversary of the Effective Date and 6.25% each three-month period thereafter. WODI has not recognized any costs associated ~~with~~ the WODI RSGAs because milestones ~~due to~~and vesting have not ~~being able to estimate the probability of it being~~been achieved. As the ~~performance goals~~milestones are achieved, the shares shall become eligible for vesting and issuance. On September 21, 2023 the WODI RSGAs were assumed by PWT per the Merger Plan Agreement and per the conversion ratio of 0.19737 established in the Merger Plan Agreement, the 15,550,000 total issuable shares under the WODI RSGAs were converted to 3,069,100 total issuable shares and the WODI RSGAs were renamed Progressive Water Treatment Restricted Stock Grant Agreements (the “PWT RSGAs”).

During the nine months ended September 30, ~~2017,~~2023, the Company ~~issued 22,825,000 purchase warrants to prospective investors~~obtained 12 month credit lines in ~~connection~~the aggregate amount of $245,500, with ~~a private offering pursuant to Section 4(2)~~an interest rate of the Securities Act of 1933, as amended, Rule 506 promulgated under Regulation D of the Securities Act and Regulation S of the Securities Act. A summary of the Company’s warrant activity and related information follows for26.07%. During the nine months ended September 30, ~~2017:~~2023, the Company paid principal in the amount of $105,621, leaving a principal balance of $139,879. During the nine months ended September 30, 2023, the Company paid interest in the amount of $23,415.

On March 1, 2021, the Company issued an aggregate of 630 shares of Series T Preferred Stock to an accredited investor (the “Purchaser’’) per terms of a Securities Purchase Agreement (the “SPA”). Per the SPA, the Company agreed to sell to Purchaser, and Purchaser agreed to purchase from the Company, 630 shares of the Company’s Series T, and two-year cashless warrants to acquire 25,200,000 shares of the Company’s common stock, valued at $0.05 per share per terms of the SPA, which were exercisable at any time in whole or in part. The purchaser and the Company agreed that in lieu of the purchase price for the Series T, the Purchaser transferred to the Company real property, with an aggregate value agreed to be $630,000 based on an appraisal from an international independent company at that time. The real property consisted of residential real estate in Buenos Aires Argentina valued at $580,000, and eight undeveloped lots valued at $50,000 in Terralta private neighborhood development. The real property exchanged for 630 shares of Series T was recorded at $630,000 and reflected on the balance sheet as a long term asset for sale at that time.

~~At September 30, 2017,~~The real property was listed for sale beginning in July 2021. However, based on indicator of impairment, during the ~~weighted average remaining contractual life of warrants outstanding:~~

~~At September 30, 2017,~~year ended December 31, 2021, the ~~aggregate intrinsic~~Company adjusted the original value of the ~~warrants outstanding was $253,930.~~asset for sale from $630,000 to $514,000 and recorded an impairment of $116,000 in the consolidated financial statements.

During the period ended December 31, 2022, after evaluating several offers, the Company considered an offer for $400,000, which was $114,000 below the previously adjusted value and was indicative of the real estate market conditions in Buenos Aires Argentina. Based on that indicator of impairment, during the year ended December 31, 2022, the Company further adjusted the previous value of the asset for sale from $514,000 to $400,000 on the balance sheet and recorded an impairment of $114,000 in the consolidated financial statements. All Series T preferred stock was converted and the warrants associated with the Series T expired during the period ended December 31, 2022.

In January 2023, the Company accepted the offer and on April 8, 2023, a deed was executed for the sale of the property for $400,000. The agreed upon payment terms were; $235,000 initial payment and the remaining $165,000 to be paid over fifteen monthly installments of $11,000 each. The initial payment was received by SMS Argentina (“SMS”), an accounting and consulting firm that was appointed by the Company as the Power of Attorney for the property. From the proceeds, SMS remitted taxes due on the transaction to the Federal Administration of Public Income (“AFIP”), which administers taxation in Argentina. On June 21, 2023, the Company received a payment of $164,935, net of all taxes assessed by AFIP and other closing fees associated with the sale of the property totaling $65,493 and recorded a receivable of $169,572 for the remaining amount on the consolidated financial statements as of June 30, 2023. Between July 1, 2023 through September 30, 2023, the Company received additional payments totaling $37,572. As of September 30, 2023, the balance of the receivable was $132,000 which is reflected on the consolidated financial statements.

~~On December 31, 2014,~~Under the provisions of the extension of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) passed by the United States Congress and signed by the President, the Company ~~formed~~was eligible for a ~~wholly owned~~refundable employee retention credit (the “ERTC”) subject to certain criteria. The Company’s subsidiary, ~~OriginClear (HK) Company, Ltd (OCHK), in Hong Kong, China. The Company has granted OCHK a master license~~Progressive Water Treatment applied for the ~~People’s Republic~~ERTC and during the nine months ended September 30, 2023, received an aggregate of ~~China, and a non-exclusive license for~~$126,879 which was recognized in the ~~rest of Asia. In turn, OCHK is expected to license regional joint ventures for the commercial development of EWS:AOx Technology. A research and manufacturing center are also planned.~~financial statements as other income.

~~The Company entered into a month-to-month lease agreement~~Our Dallas based subsidiary, PWT, rents an approximately 12,000 square foot facility located at 2535 E. University Drive, McKinney, TX 75069, with a ~~shareholder of the Company for office space in McKinney, Texas at a base~~current monthly rent of ~~$4,750 per month.~~$8,500.

Generally, a PWT project is guaranteed against defects in material and workmanship for one year from the date of completion, while certain areas of construction and materials may have guarantees extending beyond one year. The Company has various insurance policies relating to the guarantee of completed work, which in the opinion of management will adequately cover any potential claims. A warranty reserve has been provided under PWT based on the opinion of management and based on Company history in the amount of $20,000 asfor nine months ended September 30, 2023 and the year ending December 31, 2022.

On July 12, 2023, the Company entered into a Confidential Settlement and Mutual Release Agreement (the “Settlement Agreement”) with Auctus Fund, LLC (“Auctus”) relating to the settlement and release of certain pending legal actions arising out of various loans and agreements between the Company and Auctus. Pursuant to the terms of the Settlement Agreement, the Company and Auctus have resolved all outstanding legal disputes and claims between them. The appeal that was pending in the United States Court of Appeals for the First Circuit and trial matter in the United States District Court for the District of Massachusetts have been terminated and all transactions and obligations thereunder between the Company and Auctus are null and void. The terms and conditions of the Settlement Agreement are confidential and have no impact on the financial condition or operations of the Company.

As of September 30, ~~2017.~~2023, there were no material updates to the litigation matters with C6 Capital, LLC as previously disclosed in the Form 10-K filed on April 17, 2023.

Management has evaluated subsequent events according to the requirements of ASC TOPIC 855 and has determined that there are the following subsequent events:

OnBetween October 2, 2023 and October 3, ~~2017, a holder of Series B Preferred Stock converted 3,333 shares~~2023, holders of the Company’s Series ~~B Preferred Stock~~R preferred stock converted an aggregate of 200 Series R shares into an aggregate of ~~1,428,429~~51,536,831 shares of the Company’s common stock. ~~The~~

Between October 2, 2023 and November 29, 2023, an aggregate of 39,083,926 shares of common stock issued included 476,143 shares issued upon conversion of the 3,333 shares of Series B Preferred Stock at $1.05 per share and 952,286 shares as a one-time make good issuance as per the Certificate of Designation of Series B Preferred Stock and agreement betweenwere redeemed by the Company, and the ~~holder.~~redemption amount, together with cash paid by the redeeming stockholders, were used by the stockholders to purchase convertible secured promissory notes from WODI.

~~As previously reported, the Company has commenced an offering under Regulation 506c of Regulation D (the “Private Placement”)~~Between October 2, 2023 and November 29, 2023, holders of the Securities Act of 1933, as amended (the “Securities Act”) pursuant to which the Company shall sell units of its securities (the “Units”) with each Unit consisting of (i) one restricted share of its commonCompany’s Series Y preferred stock (ii) a Class A Warrant to purchase one share of its common stock, (iii) a Class B Warrant to purchase one share of its common stock, (iv) a Class C Warrant to purchase one share of its common stock and (v) a Class D Warrant to purchase one share of its common stock to qualified investors. Between October 12, 2017 and November 13, 2017, the Company sold, in the Private Placement,converted an aggregate of ~~11,100,000~~.7 Series Y shares ~~of its common stock to accredited investors for an aggregate consideration of $277,500.~~

~~On October 20, 2017, holders of convertible promissory notes converted an aggregate principal and interest amount of $31,410~~ into an aggregate of ~~2,052,968~~22,540,380 shares, including make-good shares, of the Company’s common stock.

In connection with certain one-time make good agreements, between October 2, 2017 and October 31, 2017, the Company issued an aggregate of 1,342,185 shares of its common stock to certain holders of its common stock.

On November 10, 2017, the Company entered into a Restricted Stock Grant Agreement (the “RSGA”) with Jean Louis Kindler, the Company’s Chief Commercial Officer and Director, to create management incentives to improve the economic performance of the Company and to increase its value and stock price. The RSGA provides for the issuance of up to 2,000,000 shares of the Company’s common stock provided certain milestones are met in certain stages. All shares issuable under the RSGA are performance based shares and none have yet vested nor have any been issued.

Between October ~~31, 2017~~4, 2023 and November ~~13, 2017,~~15, 2023, the Company issued to consultants an aggregate of ~~5,680,648~~3,361,416 shares of the Company’s common stock.

Between October 5, 2023 and December 6, 2023, WODI made payments on behalf of the SPAC in the aggregate amount of $567,000.

Between October 6, 2023 and October 20, 2023, the Company entered into settlement agreements with certain accredited investors pursuant to which the Company issued an aggregate of 37,040,277 shares of the Company’s common stock in ~~lieu~~settlement of ~~cash consideration.~~ certain claims with such persons.

On November 9, 2023, holders of the Company’s Series W preferred stock converted an aggregate of 25 Series W shares into an aggregate of 5,241,092 shares of the Company’s common stock.

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

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

This Quarterly Report on Form 10-Q contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control, which may include statements about our:

All statements, other than statements of historical fact included in this report, regarding our strategy, intellectual property, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this report, the words “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. All forward-looking statements speak only as of the date of this report. You should not place undue reliance on these forward-looking statements. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements we make in this report are reasonable, we can give no assurance that these plans, intentions or expectations will be achieved. These statements may be found under “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” as well as in this report generally. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this filing will in fact ~~occur~~ occur.

OriginClear, Inc. (“we”, “us”, “our”, the “Company” or “OriginClear”) was incorporated on June 1, 2007 under the laws of the State of Nevada. We have been engaged in business operations since June 2007. ~~We are currently commercializing~~In 2015, we moved into the commercialization phase of our ~~technology through joint ventures~~business plan having previously been primarily involved in research, development and licensing ~~while operating a water treatment service company in Texas, which we have designated a certified manufacturer for our technology.~~activities. Our principal offices are located at ~~525 S. Hewitt St., Los Angeles, California 90013.~~13575 58th Street North, Suite 200, Clearwater, FL 33760. Our main telephone number is ~~(323) 939-6645.~~(727) 440-4603. Our website address is www.OriginClear.com. ~~In addition~~The information contained on, connected to ~~announcing material financial information through~~or that can be accessed via our ~~investor relations~~ website ~~press releases, SEC filings and webcasts, we also intend to use the following social media channels as a means~~is not part of disclosing information about our products, our planned financial and other announcements, our attendance at upcoming investor and industry conferences, and other matters and for complying with our disclosure obligations under Regulation FD:this report.

OriginClear was founded as OriginOil in 2007, and began trading on the OTC in 2008. In 2015, it was renamed as OriginClear to reflect its mission to develop breakthrough businesses in the industrial water sector. Today, OriginClear structures itself as the Clean Water Innovation Hub™ and its mission is to incubate and grow valuable water properties that will disrupt the industry.

In 2023, OriginClear combined three of these businesses into a single subsidiary in anticipation of a merger of such subsidiary with a “blank check” company (a SPAC or Special Purpose Acquisition Company). The definitive merger agreement was announced on 24 October, 2023: https://www.originclear.com/company-news/originclears-water-on-demand-and-fortune-rise-acquisition-corporation-announce-business-combination-to-create-nasdaq-listed-company.

The assets and properties now incorporated as Water On Demand Inc. (WODI) consist of the following:

The information we post through these social media channels may be deemed material. Accordingly, investors should monitor these accounts, in addition to following the company’s press releases, SEC filings, public conference calls and webcasts. This list may be updated from time to time.

~~We have not incorporated by reference into thisreport the information in, or that can be accessed through, our website or social media channels, and you shouldnot consider it to be a part of this report.~~

	16
		NOTE: the Company did not spin off the developmental blockchain instruments $H2O, a security token for the payment of dividends, and ClearAqua, a community involvement token. At this time, the Company is not actively developing these but is pursuing Intellectual Property protection for them to the extent it finds useful.

“This is an example of OriginClear successfully incubating and growing a healthy business over five years, and selling it for many times its investment,” said Riggs Eckelberry, OriginClear CEO. “We anticipate this transaction will further benefit OriginClear shareholders as Water On Demand executes on its business plan.”

OriginClear issued a new presentation describing the new combined businesses and planning. The presentation is available online at https://www.originclear.com/investing#companypresentation

~~Overview~~Water Businesses

The Company develops and incubates businesses in its role as the Clean Water Innovation Hub™ (“CWIB”). The mission of ~~Business~~CWIB in general, is to create valuable properties through an incubation process that results in the launching of valuable spinoffs that add value to the world’s water industry.

~~OriginClear is~~The first such spinoff was on April 13, 2022, when the Company’s Board of Directors approved the plan to spin off its WOD business into a ~~leading provider~~newly formed subsidiary, Water On Demand Inc., (“WODI”) which holds the assets, liabilities, intellectual property and business operations of ~~water treatment solutions~~the WOD business.

On January 5, 2023, WODI signed a non-binding Letter of Intent with Fortune Rise Acquisition Corporation, a Delaware corporation (the “Fortune Rise”), under which Fortune Rise proposes to acquire all the outstanding securities of WODI, based on certain material financial and business terms and conditions being met.

On April 14, 2023, WODI entered into an Asset Purchase Agreement with the Company, whereby it agreed to purchase all of the assets related to the Company’s “Modular Water Service” business, including licenses, technology, intellectual property, contracts, business models, patents and other assets in exchange for 6,000,000 shares of WODI common stock. The assets include a reissuance for a new ten-year term of OriginClear’s existing global master license to the five patents and related Intellectual Property of inventor Daniel M. Early, P.E., who heads Modular Water, and the ~~developer~~right to file patents for all additional inventions since 2018, when OriginClear created the unit. MWS is in commercial operation and operates as a division of WODI. On April 14, 2023, the Company transferred the assets associated with its Modular Water Systems division (“MWS” or “Modular Water”) (www.modularwater.com) to WODI.

On May 22, 2023, the Company announced that its subsidiary Water On Demand (WODI) had recently entered into a ~~breakthrough water cleanup technology. Through~~Memorandum of Understanding (MOU) to acquire an established international SaaS (Software as a Service) Developer (Developer), founded nearly twenty years ago, which operates with a stable customer base of technology companies. The acquisition is anticipated to be accretive. The MOU provides a framework for negotiating a definitive agreement for the acquisition of the Developer. The talks are in an early stage and may not succeed.

On September 26, 2023, the Company announced that it merged its ~~wholly owned~~ subsidiaries, WODI and PWT to create better enterprise value for a potential merger opportunity with Fortune Rise Acquisition Corporation (‘FRLA’).

On September 28, 2023, FRLA and OriginClear ~~provides systems~~Inc., announced that FRLA and ~~services~~WODI agreed to ~~treat water~~nominate a new target – the recently merged PWT /WODI. Accordingly, the Letter of Intent (“LOI”) executed January 5, 2023 with WODI was amended to designate PWT as the new target of the acquisition. Under the revised/amended LOI, FRLA proposes to acquire all the outstanding securities of PWT, based on certain material financial and business terms and conditions being met. The LOI is not binding on the parties and is intended solely to guide good-faith negotiations toward definitive agreements.

Post-merger with WODI, PWT effected a name change to Water On Demand Inc.

On October 24, 2023 FRLA and OCLN announced that FRLA and WODI had entered into a definitive business combination agreement (the “BCA”). The transaction represents a pro forma equity valuation of approximately $72 million of the Combined Company, assuming no further redemptions of FRLA public shares by FRLA’s public shareholders. The estimated cash proceeds available to the Combined Company from the transaction consists of FRLA’s $ 39,635,883 of cash held in trust, assuming no further redemptions of FRLA public shares. Upon closing of the transactions contemplated under the BCA, and assuming none of FRLA’s public shareholders elect to redeem their shares of common stock and no additional shares of common stock are issued, it is anticipated that FRLA’s public shareholders would retain an ownership interest of approximately 46% of the Combined Company, the sponsors, officers, directors and other holders of FRLA founder shares and private shares will retain an ownership interest of approximately 18% of the Combined Company, and the WOD stockholders will own approximately 36% of the Combined Company, based on its agreed acquisition valuation of $32 million, an approximate 3.2x multiple of its 2022 revenue. The existing stockholders of WOD are expected to roll 100% of their equity into the Combined Company.

Currently, OriginClear’s mission as the CWIB is the following:

Support the rollout of the WODI post-merger entity (the plan is to retain the name). OriginClear has proposed a post-merger management services contract with WODI, which over time will be phased out as WODI builds its own internal team and capabilities.

In particular, OriginClear is assisting WODI with its aggressive acquisitions plan, starting now and to be finalized post the SPAC merger (there is no assurance of merger success.)

Selecting companies and/or technologies for funding and development. We may not restrict ourselves to the water industry.

Milestones

Progressive Water Treatment Inc.

On October 1, 2015, the Company completed the acquisition of Dallas-based Progressive Water Treatment Inc. (“PWT”), a designer, builder and service provider for a wide range of ~~industries,~~industrial water treatment applications. PWT, together with MWS, other proprietary technologies and potential future acquisitions, aims to offer a complementary, end-to-end offering to serve growing corporate demand for outsourced water treatment.

PWT’s Business

Since 1995, PWT has been designing and manufacturing a complete line of water treatment systems for municipal, industrial and pure water applications. PWT designs and manufactures a complete line of water treatment systems for municipal, industrial and pure water applications. Its uniqueness is its ability to gain an in-depth understanding of customer’s needs and then to design and build an integrated water treatment system using multiple technologies to provide a complete solution for its customers.

PWT utilizes a wide range of technologies, including chemical injection, media filters, membrane, ion exchange and SCADA (supervisory control and data acquisition) technology in turnkey systems. PWT also offers a broad range of services including maintenance contracts, retrofits and replacement assistance. In addition, PWT rents equipment in contracts of varying duration. Customers are primarily served in the United States and Canada, with the company’s reach extending worldwide from Siberia to Argentina to the Middle East.

PWT Milestones

In the first quarter of 2019, the Company increased the number of the manufacturer’s representatives for its operating units, PWT and Modular Water Systems (“MWS”).

On April 15, 2021, the Company announced that its Progressive Water Treatment division is now shipping BroncBoost™, its workhorse Booster Pump Station equipment line. Engineered and built in Texas, BroncBoost allows customers to control water flow rates and pressure for mission critical water distribution systems.

On August 25, 2021, PWT entered into a Master Services Agreement (MSA) with a large US public utility company for water filtration systems that will provide process water at three power plants. The utility issued a purchase order for approximately $1.8 million, for the first power plant. The total purchase price payable to PWT under the MSA is approximately $5 million, subject to certain conditions, including receipt and acceptance by PWT of additional purchase orders. We expect the overall contract to take up to two years to deliver from the date of the MSA.

On September 26, 2023, the Company announced that it merged its subsidiaries, WODI and PWT.

Modular Water Systems – now part of Water On Demand, Inc.

On June 22, 2018, OriginClear signed an exclusive worldwide licensing agreement with Daniel “Dan” Early P. E. for his proprietary technology for prefabricated water transport and treatment systems. On July 19, 2018, the Company began incubating its Modular Water Treatment Division (MWS) around Mr. Early’s technology and perspective customers. The Company has funded the development of this division with internal cash flow. In Q1 of 2020, the Company fully integrated MWS with wholly-owned Progressive Water Treatment Inc. The Company is currently developing MWS as a discrete line of business for an eventual spinoff. Mr. Early currently serves as Chief Engineer for OriginClear.

On July 19, 2018, the Company launched its Modular Water Treatment Division, offering a unique product line of prefabricated water transport and treatment systems. Daniel “Dan” Early P.E. (Professional Engineer) heads the Modular Water Systems (“MWS”) division. On June 25, 2018, Dan Early granted the Company a worldwide, exclusive non-transferable license to the technology and knowhow behind MWS (See “Intellectual Property”). A ten-year renewal on May 20, 2020 added the right to sublicense and create manufacturing joint ventures. On July 25, 2018, MWS received its first order, for a brewery wastewater treatment plant.

With PWT and other companies as fabricators and assemblers, MWS designs, manufactures and delivers prefabricated water transport (pump and lift stations) under the EveraMOD™ brand; and wastewater treatment plant (“WWTP”) products under the EveraSKID™ and EveraTREAT™ brands to customers and end-users which are required to clean their own wastewater, such as ~~municipal, pharmaceutical, semiconductors,~~schools, small communities, institutional facilities, real estate developments, factories, and industrial parks.

On Nov 7, 2019, the Company published a case study showing how Modular Water Systems may help businesses expand into rural land. The case study shows how point-of-use treatment solves lack of access to the public sewer system.

On March 5, 2020, the Company announced disruptive pump and ~~oil & gas. To rapidly grow this segment~~lift station pricing, stating that its prefabricated modules with a lifespan of up to 100 years now compete with precast concrete.

On September 28, 2021, the Company announced that MWS deployed its pilot Pondster™ brand modular lagoon treatment system at a Mobile Home Park (MHP) or trailer park, in Troy, Alabama. Modular Water Systems has since offered its treatment system to other MHPs and recently completed an installation at an MHP in Pennsylvania.

On June 16, 2022 the Company announced that MWS received purchase orders for approximately $1.5 Million in the single month of May of 2022. This compared to $1,774,880 in purchase orders for the entire year 2021.

On July 25, 2022 the Company announced that decentralized water treatment, long pioneered by OriginClear’s Modular Water Systems™ (“MWS”), is now being mandated by major US cities to recycle water in large new buildings.

On August 12, 2022 the Company announced the inaugural delivery and installation of its pre-engineered EveraBOX™ to implement a low-risk Liquid Ammonium Sulfate (LAS) disinfectant system for Pennsylvania’s Beaver Falls Municipal Water Authority (BFMA). Typical of MWS products, EveraBOX is manufactured using inexpensive, long-lasting High-Density Polyethylene (HDPE) or Polypropylene (PP) materials. These materials have proven to be less affected by supply chain issues currently impacting metal and fiberglass construction.

On April 14, 2023, WODI entered into an Asset Purchase Agreement with the Company, whereby it agreed to purchase all of the assets related to the MWS business, ~~we strategically acquire profitable~~including licenses, technology, intellectual property, contracts, business models, patents and ~~well-managed~~other assets in exchange for 6,000,000 shares of WODI common stock.

On May 25, 2023, the Company announced that in the 1^st Quarter of 2023, Modular Water Systems (MWS), which at the time was still a division of the Company, contributed 58% of total revenue, or $1,155,803. This exceeded the publicly disclosed forecast for the division. MWS gross profit was $314,713, close to the forecast of $336,500, with a gross margin of 27%.

Water on Demand™: a new strategic direction

OriginClear has developed an outsourced water treatment ~~companies,~~business called “Water On Demand”: or “WOD” as a potential revenue source. The WOD model intends to offer private businesses the ability to pay for water treatment and purification services on a per-gallon basis. This is commonly known as Design-Build-Own-Operate or “DBOO”. WOD is designed to select projects, fully qualify them, provide financing for Design-Build-Own-Operate service contracts, and thereafter manage assets, contracts, clients, investors, strategic partners and vendors.

On April 13, 2021, we announced formation of a wholly-owned subsidiary called Water On Demand #1, Inc. (“WOD #1”) to pursue capitalization of the equipment required. The WOD Subsidiaries, Water On Demand #2, Inc. (“WOD #2”), Water On Demand #3, Inc. (“WOD #3”), Water On Demand #4, Inc. (“WOD #4”) were separately created to permit optional segmenting of capital pools according to strategic partnerships. The Company elected to wind down WOD#2, WOD#3 and WOD#4 and make the capital raised for them through the Company’s Series Y offering available to be deployed, subject to a planned management contract.

On April 13, 2022, the Company’s Board of Directors approved the plan to spin off its WOD business into a newly formed wholly-owned subsidiary, Water On Demand Inc., (“WODI”), as a result, WODI holds all of the assets, liabilities, intellectual property and business operations of the Water On Demand business. In connection with the spin off, the Company stipulated that it would exclude the WOD Subsidiaries, and the capital raised, and to be raised in the future with respect to those entities through the sale of its Series Y offering, from the assignment of assets and will make the capital available as part of a planned management contract. WODI is conducting an offering under Regulation A by which ~~allow us~~WODI is raising capital to ~~expand our global market presence and technical expertise.~~ direct toward WOD projects. (Effective as of June 26, 2023, the Company announced it is suspending the sale of securities under this Regulation A Offering. The Company will not conduct any sales of securities under this offering until such time as further notice is given by filing an amendment or a Form 1-U. As of the effective date, the Company has sold a total of 12,300 shares for total potential proceeds of $61,500.)

To enable rapid scaling, WODI does not itself intend to build, maintain or service the water treatment systems it finances, but instead contract with regional water service companies to carry out these functions. On April 6, 2022, an agreement in principle was reached to work with the first of these intended contractors, Envirogen Technologies (www.envirogen.com), a ~~new era~~30-year international provider of ~~clean~~environmental technology and ~~socially responsible~~process solutions (www.originclear.com/company-news/originclear-and-envirogen-to-partner-on-water-on-demand). Future resources to build, maintain and service these financed systems may come from acquisitions; however, these are not actively being planned.

Delegating the building and operating of WOD-financed systems to regional water companies under performance contract, with the aim of developing a network of such partners, is expected to enable rapid scale-up of the WOD program, and the partner network would create a high barrier to entry for competitors.

At the time of this filing, WODI had no staff or independent resources. However, the MWS and PWT units which are part of the combined entity and managed by OriginClear under a planned management services agreement, are generating revenue and profitable. The Board of Directors of OriginClear serves as the Board for WODI, the CEO of OriginClear serves as CEO of WODI, and the CFO of OriginClear also serves as CFO of WODI. Under the prospective management services contract, OCLN plans to provide all staffing and administrative resources, as well as fee-based access to the funds it has raised for WOD investments.

The Decentralization Megatrend

According to a 2021 report by McKinsey & Co., US water infrastructure: Making funding count (https://www.mckinsey.com/industries/electric-power-and-natural-gas/our-insights/us-water-infrastructure-making-funding-count):

“The need for investment in the US water system is at an unprecedented level. On average, 14 to 18 percent of total daily treated potable water in the United States is lost through leaks, with some water systems reporting water-loss rates exceeding 60 percent. Much of the nation’s water and wastewater infrastructure was built in the 1970s and 1980s. Since then, the share of federal capital investment has declined, putting the majority of capital-funding responsibility on state and local governments, which are increasingly juggling funding priorities.”

“According to the American Water Works Association’s State of the water industry report, 31 percent of utilities surveyed in 2019 expressed doubt in their ability to cover the full cost of providing services, a figure that rose to 42 percent during the 2020 COVID-19 lockdown.

“Simply raising rates is not a practical solution because water bills are already too high for many US households. Even before the COVID-19 pandemic, 20.0 percent of US households in 2019 were paying more than 4.5 percent of their household income on water bills—a level that is considered unaffordable. This figure rose to 24 percent in the first seven months of 2021 (Exhibit 3).

Figure 1: Water rates rise but utilities remain underfunded.

As municipalities continue to be underfunded with rising water rates (Figure 1), businesses are increasingly choosing to treat and purify their own water, in a trend known as Decentralized Water, first described in the Lux Research presentation of June 28, 2016. (https://members.luxresearchinc.com/research/report/20060).

According to the Lux Research data, the unmet infrastructure needs of America’s 150,000+ water systems will exceed $100 billion per year by 2025. And the recent Infrastructure Investment and Jobs Act only provided one-time funding of $55 billion, which is less than one year’s deficit.

It is this underfunding that is creating the water quality problems we are seeing in places like Flint, Michigan and Jackson, Mississippi.

It is not realistic to expect this underfunding of central water to be resolved anytime soon. The alternative is to simply reduce the load on these central systems. Since industry and agriculture together account for 89% of all water demand in the United States (https://ourworldindata.org/water-use-stress), we can enable commercial users to purify their own wastewater, thereby enabling water districts to focus on serving residential users – achieving a major social justice victory by simply unburdening the central facilities.

Self-treatment is a win-win, too – because businesses can do better by treating their own water; for instance, implementing recycling of the water they pay for, and controlling their own costs.

But to make such a decentralization program work, capital is needed. Most businesses simply do not have it in their capital plan to treat their own water. Now, with Water On Demand, they can forget about investing in capital and expertise: they can simply continue to pay on the meter as they always have, but to a micro-utility that sits on their own premises.

Reducing Risk through Outsourcing

Inflation of water rates greatly exceeds core inflation, creating a risk for managers of businesses served by municipalities. We believe this creates an incentive for self-treatment; but these businesses may lack the capital for large water plant expenditures, and the in-house expertise to manage them. Outsourcing through Water on Demand means that these companies do not have to worry about financing or managing the project.

As an example, in information technology sector, few companies operate their own server in-house powering their website. Rather, such servers are typically managed by professionals through a service level agreement. We believe this same concept can be applied towards water treatment, using outsourced water treatment solutions ~~we invented Electro~~whereby the vendor retains ownership of the equipment. This concept is expanded to “Own and Operate”, an extension of the basic “Design and Build”, for a full offering known as “Design Build Own and Operate” or “DBOO”, which is very similar to the solar energy programs known as Power Purchase Agreements (PPAs).

Under such a plan, a business can outsource its wastewater treatment and avoid significant capital expenses and management responsibilities which can be a distraction from their core business.

We believe this is financially and operationally attractive to industrial, agricultural and commercial water users and can potentially drive additional revenue streams for WODI by providing water treatment as a service.

Technology specifically developed for decentralization.

In 2018, OriginClear launched its Modular Water ~~Separation™~~Systems (MWS) division (www.modularwater.com), headed by Daniel M. Early, P.E., a ~~breakthrough high-speed water cleanup technology using multi-stage electrochemistry, which we license worldwide to~~pioneer of on-site or decentralized water treatment in this country. Supported by its proprietary technology, this division already serves businesses doing their own water treatment. These modular systems can be easily put to work for pre-funded, pay-per-gallon applications, potentially creating a barrier to entry for other companies wanting to do the same.

Also, the portable nature of some of these prefabricated, drop-in-place Modular Water Systems may provide a competitive benefit for a pure service model where the equipment ~~manufacturers.~~remains the property of the Company, because the mobility of certain products MWS offers (such as EveraSKID), enables some degree of repossession in the event the client fails to pay their monthly bill. We believe this is a key competitive advantage.

Finally, WODI intends to license MWS technology to local water companies as part of their contract to design, build and operate systems on behalf of WODI, thus achieving both acceptance of such technology and a standardized “fleet” of installed systems.

Implementation of Water isOn Demand

On March 17, 2021, OriginClear incorporated Water On Demand #1 Inc. (“WOD#1”) in Nevada as a wholly owned subsidiary to provide a capital pool for our ~~most valuable resource~~Water on Demand business.

In November 2021, the Company created additional Water on Demand subsidiaries – Water on Demand # 2, Inc. (WOD # 2), Water on Demand # 3, Inc. (WOD # 3) and Water on Demand # 4, Inc. (WOD # 4) (in the aggregate, referred to as the “WOD Subsidiaries”), which were each separately created to permit optional segmenting of capital pools according to strategic partnerships. The Company simplified this structure by placing all funds in WOD #1 and wound down the others. As they are subject to a security guaranty by the Company, the WOD Subsidiaries, and the ~~mission~~capital raised for them through the sale of the Company’s Series Y offering, shall continue to be held by the Company. This capital will be made available to WODI to be deployed, subject to a fee schedule under a proposed management contract.

On April 6, 2022, the Company agreed in principle to an arrangement with Houston-based, international water service company Envirogen Technologies for certain operations and maintenance (O&M) functions, the first of a potential series of such partnerships, intended to enable Water On Demand to focus on finance and asset management while the water industry benefits from a steady stream of pre-capitalized projects. (https://www.originclear.com/company-news/originclear-and-envirogen-to-partner-on-water-on-demand)

On April 13, 2022, the Company announced the formation of Water On Demand, Inc. (“WODI”) as a wholly owned subsidiary which holds the assets, liabilities, intellectual property and business operations of the Water On Demand business. Water On Demand is designed to offer clean water systems to businesses and communities as a managed service without any capital requirement.

On June 29, 2022, WODI announced the launch of its $300 Million offering (the “Reg D Offering”). The ~~OriginClear Group™ (the “Group”~~offering of the securities is made pursuant to an exemption from registration under Rule 506(c) of Regulation D, to accredited investors only.

The Company requires funding in order to execute on its Water on Demand initiative. As of the period ended September 30, 2023, the Company received net aggregate funding in the amount of $ 6,267,577 through the sale of its Reg D Offering, Series Y Preferred Stock dedicated to the Water on Demand program. (see Notes to Financial Statements- Sale of Preferred Stock).

On February 17, 2023, the Securities and Exchange Commission qualified the Offering Circular for the offering of securities by WODI pursuant to Regulation A offering (“Reg A Offering”). The Reg A Offering is intended to accumulate capital for WODI to direct toward WOD projects. The purpose of this Offering is to ~~improve~~create an independent funding base for WODI and to enable the ~~quality~~Company to provide financing for Design Build Own and Operate lifecycle projects internally without requiring direct financial support by OCLN. OCLN will continue to provide shared administrative services. The Reg A Offering is administered by New York-based Castle Placement (“Castle”) as the placement agent.

On March 9, 2023, the Company announced that it launched a limited preview of the Reg A Offering. Effective as of June 26, 2023 (the “Effective date”), the Company announced it suspended the sale of securities under the Reg A Offering. The Company will not conduct any sales of securities under this offering until such time as further notice is given by filing an amendment or a Form 1-U. As of the Effective Date, the Company sold a total of 12,000 shares for total proceeds of $60,000.

In connection with the Reg A Offering, the Company decided to limit the Reg D Offering to $20 million.

WODI is actively evaluating potential clients for a test of water treatment and ~~help return it~~purification services on a pay-per-gallon basis, but a first agreement has not been reached. Also, WODI is in early stage talks with partners to deliver DBOO services, with the Company providing financing and contract management services. In the event such talks do not succeed, WODI would need to implement its ~~original~~own resources for such DBOO services.

On April 14, 2023, the Company transferred its Modular Water Systems division (MWS or Modular Water) (www.modularwater.com) and ~~clear condition.~~the related assets to WODI.

~~The Group~~On September 26, 2023, the Company announced that it merged its subsidiaries, WODI and PWT to create better enterprise value for a potential merger opportunity with Fortune Rise Acquisition Corporation (‘FRLA’).

~~Outsourcing~~On September 28, 2023, FRLA and OriginClear Inc., announced that FRLA and WODI agreed to nominate a new target – the recently merged PWT with WODI. Accordingly, the Letter of Intent (“LOI”) executed January 5, 2023 with WODI was amended to designate PWT as the new target of the acquisition. Under the revised/amended LOI, FRLA proposes to acquire all the outstanding securities of PWT, based on certain material financial and business terms and conditions being met. The LOI is not binding on the parties and is intended solely to guide good-faith negotiations toward definitive agreements.

In connection with the merger with WODI, PWT effected a ~~fast-growing reality~~name change to Water On Demand Inc.

On 24 October 2023, Fortune Rise Acquisition Corporation (Nasdaq: FRLA) and the Company announced that FRLA and Water On Demand Inc. (WODI) have entered into a definitive business combination agreement (the “BCA”).

The transaction represents a pro forma equity valuation of approximately $72 million of the Combined Company, assuming no further redemptions of FRLA public shares by FRLA’s public shareholders. The estimated cash proceeds available to the Combined Company from the transaction consists of FRLA’s $ 39,635,883 of cash held in trust, assuming no further redemptions of FRLA public shares.

The proceeds will be used to develop the Water On Demand water-as-a-service network, grow the Modular Water and Progressive Water business units, and carry out an aggressive acquisition program, which is expected to accelerate the existing growth. A number of assumptions have been made as to purchase multiples, net growth, synergies and other factors, and there are no guarantees that the Combined Company will succeed in the acquisitions and subsequent integrations of the acquired entities. The acquisitions will prioritize network management software, management and engineering staffing, and vertical integration through acquisition of component fabricators.

Upon closing of the transactions contemplated under the BCA, and assuming none of FRLA’s public shareholders elect to redeem their shares of common stock and no additional shares of common stock are issued, it is anticipated that FRLA’s public shareholders would retain an ownership interest of approximately 46% of the Combined Company, the sponsors, officers, directors and other holders of FRLA founder shares and private shares will retain an ownership interest of approximately 18% of the Combined Company, and the WODI stockholders will own approximately 36% of the Combined Company, based on its agreed acquisition valuation of $32 million, an approximate 3.2x multiple of its 2022 revenue. The existing stockholders of WODI are expected to roll 100% of their equity into the Combined Company.

The board of directors of each of FRLA and WODI unanimously approved the transaction, which is expected to be completed in the second quarter of 2024, subject to, among other things, the approval by the shareholders of FRLA and WODI, satisfaction of the conditions stated in the definitive agreement and other customary closing conditions, including a registration statement being declared effective by the SEC, and approval by The Nasdaq Stock Market to list the securities of the Combined Company.

See release: https://finance.yahoo.com/news/originclear-water-demand-fortune-rise-200000291.html

Advisory Support for OriginClear

In September 2020, OriginClear announced that Philanthroinvestors had entered a strategic agreement with OriginClear and had listed the Company on its new Water Philanthroinvestors program. At the same time, OriginClear appointed Philanthroinvestors Founder, Ivan Anz and CEO, Arte Maren to OriginClear’s Board of Advisors. Recently, Mr. Maren was replaced as CEO and will continue to serve Philanthroinvestors in an advisory role.

$H2O™

On May 10, 2021, OriginClear filed a patent application for its “System And Method For Water Treatment Incentive”, which includes blockchain technology and non-fungible tokens (“NFT(s)”) to simplify the distribution of payments on outsourced water ~~treatment. Tougher~~treatment and purification services billed on a pay-per-gallon basis ahead of inflation, or Water On Demand.

On May 16, 2021, the Company applied for a registered trademark for the mark $H2O (also referred to as H2O) as the blockchain system representing this activity. The current filing basis is “Intent-to-use basis” (under Trademark Act Section 1(b)). The $H2O trademark application has been approved for publication/opposition on April 26, 2023. This application will proceed to registration if no 3rd party files an opposition to this application within 18-month from the opposition period.

On June 10, 2021, the Company named Ricardo Fabiani Garcia, an OriginClear investor and veteran technologist, to the Company’s Board of Advisors. Mr. Garcia will advise the management team as it sets up the roadmap and chooses the resources for the $H2O project. Currently, the focus is on a prototype for $H2O, in support of the patent filing.

There is no active development effort for $H2O. Depending on the final form that $H2O takes, we may encounter regulatory concerns that we cannot guarantee we will overcome. In that event, we would fall back on ordinary financial payment systems. Neither our Water on Demand or other current business models rely on any blockchain system for operation, and we can accomplish our operational goals using ordinary financial and currency channels. The Company does not intend to incorporate a blockchain system in any registered offering.

Potential Acquisitions and Incubations

The Company, intends to support WODI in acquiring assets and teams to support its growth.

We are particularly interested in companies which support the drop-in-place Modular Water Systems, provide engineering services, or successfully execute on Design-Build-Own-Operate. These companies are growing fast, because tougher regulations, water scarcities and general outsourcing trends are driving industrial and agricultural water treatment users to delegate their water problem to service providers. As Global Water Intelligence pointed out in their report on October 30, 2015, ~~“Water~~“Water is often perceived as a secondary importance, with end-users increasingly wanting to focus solely on their own core business. This is driving a move away from internal water personnel towards external service experts to take control of water aspects.” External service experts are typically ~~small,~~ small–privately owned and locally operated. ~~Consolidating these companies~~Creating a network of such providers could lead to enormous economies of scale through sharing of best practices, technologies, and ~~customers. Decentralization is~~customers and could represent a major barrier to entry for Water On Demand’s competitors.

The Company cautions that suitable acquisition candidates may not be identified and even if identified, the Company may not have adequate capital to complete the acquisition and/or definitive agreement may not be reached. Internally incubated businesses, similarly, may not become commercial successes

Patents and Intellectual Property

On June 25, 2018, Dan Early granted the Company a worldwide, exclusive non-transferable license to intellectual property consisting of five issued US patents, and design software, CAD, marketing, design and specification documents (the “Early IP”).

On May 20, 2020, we agreed on a renewal of the license for an ~~even greater trend in water, similar~~additional ten years, with three-year extensions. We also gained the right to ~~what has been seen in energy decentralization through solar~~sublicense, and, ~~wind off-grid generation. Water is becoming increasingly scarcer. McKinsey’s Transforming Water Economies forecasts~~with approval, to create ISO-compliant manufacturing joint ventures.

The license to the Early IP was included as part of the sale of the MWS assets to WODI on April 14, 2023. The license was reissued on July 9, 2023 to WODI, restarting the 10-year term (plus three-year extensions) on that ~~“without action, global water demand could outstrip supply by up to 40 percent by 2030.” Furthermore, existing water infrastructure in~~date.

The Early IP consists of combined protection on the ~~United States is aging~~materials and ~~water loss is increasing. According to Lux Research, updating the country’s national water infrastructure will require an investment~~configurations of $270 billion; money that will be hard to pull together for projects that could take decades to complete. In the meantime, centralized water systems are forcing water users to treat their own water with small, modular water treatment systems. OriginClear is acquiring companies to help industrial water users treat their water themselves, and often reuse it. We believe those companies are going to grow tremendously because of this “local water” growth trend. We believe that assembling a group of water treatment companies is an opportunity for significant growth and increased Company value for the stockholders.

~~Progressive Water Treatment~~

On October 1, 2015, Dallas-based Progressive Water Treatment, Inc. (“PWT”) became the first company in the Group. PWT is a fast-growing designer, builder and service provider for a wide range of industrial water treatment applications. PWT reported revenue of $4,794,637 for the period ending December 31, 2016. For the first nine months of 2017, PWT reported revenue of $2,215,491 which is included in the consolidated financial statements ending September 30, 2017.

~~PWT’s Business~~

~~Since 1995, PWT has been designing and manufacturing a~~ complete ~~line of~~packaged water treatment systems, built into containers. The patents consist of the following:

#	Description	Patent No.	Date Patent Issued	Expiration Date
1	Wastewater System & Method	US 8,372,274 B2 Applications: WIPO, Mexico	02/12/13	07/16/31
2	Steel Reinforced HDPE Rainwater Harvesting	US 8,561,633 B2	10/22/13	SEE NOTE
3	Wastewater Treatment System CIP	US 8,871,089 B2	10/28/14	SEE NOTE
4	Scum Removal System for Liquids	US 9,205,353 B2	12/08/15	02/19/34
5	Portable, Steel Reinforced HDPE Pump Station CIP	US 9,217,244 B2	12/22/15	10/20/31

NOTE: Two patents, U.S. Patent Nos. 8,561,633 and 8,871,089, are currently expired. Patent No. 8,561,633 is a stormwater filtration patent that does not pertain to the MWS business model. Patent No. 8,871,089 is a Continuation-in-Part (CIP) on the original Patent No. 8,372,274. This original patent and Patent No. 9,217,244 are the basis for ~~municipal, industrial~~the current MWS business and ~~pure water applications. Known as an OEM (Original Equipment Manufacturer), PWT utilizes a wide range~~therefore the status of technologies, including chemical injection, media filters, membrane, ion exchange and SCADA technology, in turnkey systems that it designs and builds. PWT also offers a broad range of services including maintenance contracts, retrofits and replacement assistance. In addition, PWT rents equipment through contracts of varying duration. Customers are primarily servedthe CIP is not considered material.

Additionally, the Trade Secret documentation, engineer design programs, drawings, etc. utilized in the ~~United States and Canada, with PWT’s reach extending worldwide from Japan to Argentina to~~day-to-day business create the ~~Middle East.~~

~~OriginClear is currently in discussions for additional, accretive acquisitions~~value of ~~companies specializing in complementary markets and applications.~~the ongoing business.

~~Technology Licensing~~

For its first eight years of operations, OriginClear focused uniquely on development and commercialization of its breakthrough Electro Water Separation™ technology. In 2015, the technology went into commercial phase, and the Company launched it as OriginClear Technologies, operating in parallel to the Group. The mission of OriginClear Technologies is to develop Electro Water Separation™ and achieve its full recognition as an international industry standard in treating our increasingly complex wastewater treatment challenges. For this purpose, OriginClear Technologies relies on an ongoing strong R&D and engineering activity for the development of its technology, while actively building its network of partners, licensees and joint venture partners for commercial development. A key element of this strategy is OriginClear (HK), OriginClear’s wholly-owned subsidiary in Hong Kong that manages Asia-Pacific market development, with a special focus on China sales and manufacturing. While OriginClear Technologies focuses on developing and monetizing the Company’s internally-developed Intellectual Property, best practices and trade secrets, it is expected to do the same for technologies which may result in future from the Group’s acquisition of profitable water treatment companies.

~~The Technology~~

OriginClear is the proprietary developer of Electro Water Separation™ (EWS), the high-speed, primarily chemical-free technology to clean up large quantities of water. It removes oils, suspended solids, certain dissolved solids, and pathogens, in a continuous and energy-efficient process. The Company originally developed this technology to solve the challenge of removing microalgae from a highly dilute state. The EWS technology remains the most efficient non-chemical, continuous mechanism for the concentration of live algae cells from water. The electro-chemical process was then extended, first to cleaning up oil and gas waste water and most recently, to industrial, agricultural and urban effluents. These water treatment applications are entirely electrochemical in nature and do not rely on algae for its cleaning capabilities, which is a separate application of the technology. EWS is designed to be an early step in removal of oils, solids and pathogens; reducing the work that more expensive, downstream processes such as Ultra Filtration or Reverse Osmosis must do, therefore enabling more cost-efficient and high-volume water cleanup overall.

~~In March of 2016,~~On May 10, 2021, OriginClear announced that it had ~~successfully developed~~filed a patent application titled “System And Method For Water Treatment Incentive”, for using blockchain technology and ~~proved Advanced Oxidation~~non-fungible tokens (NFT) to simplify the distribution of payments on outsourced water treatment and purification services billed on a pay-per-gallon basis ahead of inflation.

With the rising need for ~~its breakthrough~~local, point-of-use or point-of-discharge water cleanup system, EWS. University laboratory tests have shown that EWS with Advanced Oxidation (EWS:AOx™) can now extract dissolved contaminants, which are otherwise difficult to remove without chemicals such as chlorine. Overall,treatment solutions, the system has shown a dramatic reduction in Total Organic Compounds which includes all forms of organic contamination, solids, miscible or dissolved, to meet new stringent global discharge requirements. Even prior to this innovation, EWS, combined with an iSep ultrafiltration membrane, demonstrated upMWS licensed IP family is the core to a 99.9% removal of dispersed oil, 99.5% removal of suspended solids as well as successful treatment of chemical oxygen demand (COD), including specific contaminants such as ammonia, phosphorus and hydrogen sulfide. These results were presented at the International Water Conference in 2015. In 2016, OriginClear filed for a patent, which is still pending, to protect the new AOx process andportable, integrated, transportable, plug-and-play system ~~configuration.~~

~~Today, we are capable of pairing the two technologies as EWS:AOx™, or separately, as the application requires. OriginClear believes~~ that, its technology is valuable to the industry because it has the potential to greatly extend the life of membranes and filters by effectively treating very dirty, oily water, while reducing chemical use significantly. OriginClear also believes that its Advanced Oxidation technology will help neutralize harmful micro-contaminants, such as industrial solvents, which is difficult or impossible to achieve withunlike other technologies. Overall, the system has shown a dramatic reduction in Total Organic Compounds which includes all forms of organic contamination, solids, miscible or dissolved, to meet new stringent global discharge requirements.

~~Recently, with our initial commercial contract for a landfill upgrade in Malaysia, we have shown that our systems~~packaged solutions, can be ~~retrofitted into existing installations, avoiding~~manufactured in series, have a longer life and are more respectful of the ~~time and expense of ground-up construction and enabling rapid compliance with new, stringent discharge regulations for treatment companies.~~environment.

The common feature of this IP family is the use of a construction material (Structural Reinforced ThermoPlastic or SRTP), for the containers that is:

	18●	more durable: an estimated 75 to 100-year life cycle as opposed to a few decades for metal, or 40 to 50 years maximum for concrete;

	●	easier to manufacture: vessels manufacturing process can be automated; and

	●	recyclable and can be made out of biomaterials

~~Targeting~~In addition, patents US 8,372,274 and US 8,871,089 (1 and 3) relate to the ~~microtoxins in drinking~~use of vessels or containers made out of this material combined with a configuration of functional modules, or process, for general water treatment.

Other subsequent patents, which build upon the original claims, focus on more targeted applications. These patents outline a given combination of modules engineered inside the vessel to address a specific water treatment challenge.

On April 14, 2023, WODI entered into an Asset Purchase Agreement with the Company, whereby it agreed to purchase all of the ~~human body is water. And that water (entering our bodies directly, or indirectly through food)~~assets related to the Company’s “Modular Water Service” business, including licenses, technology, intellectual property, contracts, business models, patents and other assets in exchange for 6,000,000 shares of WODI common stock. The assets include an assignment of OriginClear’s existing global master license to the five patents of inventor Daniel M. Early, P.E., ~~is increasingly contaminated with a potent mix of chemicals, such as glyphosate or Roundup, atrazine, dioxane, estrogen, pharmaceutical drugs~~who heads Modular Water, and ~~much, much more. These chemicals are directly implicated in many disorders including cancer. Their effect may be greatly increased as a cocktail of chemicals,~~ the ~~destructiveness of which we can only guess at. Bottled water is often contaminated, too. In fact, it is very difficult~~right to ~~find truly pure water, whether in~~file patents for all additional inventions since 2018, when OriginClear created the ~~water we drink, or in the water that irrigates our crops.~~unit.

~~In the water treatment industry, Advanced Oxidation Process (AOP) is employed to create abundant reactive oxygen species (ROS), which kill all organic material, even many~~Recently, OriginClear commissioned a valuation of the ~~micro-toxins that are otherwise so difficult~~Early IP, which yielded a nominal value between $26,637,185 and $53,224,807. According to ~~remove. OriginClear believes it has invented~~ the ~~next generation of AOP, using electrical reaction efficiently, and capable of being applied to drinking water~~valuation, the Projected Total Available Market in a variety of settings including, ultimately, the home. Our breakthrough process, for which we filed our latest patent in March of 2016, is called AOx. We used this process in July of 2017 to demonstrate in the laboratory the ability to virtually eliminate the herbicide glyphosate from drinking water by up to 99.3%, according to independent test results.2026 exceeds $8 Billion.

~~We believe that AOx can be a simpler and effective way to treat water for many micro-toxins at city treatment plants, at irrigation districts, in bottling water plants and eventually in the home.~~

~~We are continuing to test for various contaminants, and to invent ways to effect the removal of microtoxins, real-time and in a number of settings.~~

~~Meanwhile, we are pursuing research alliances. And in the future, we plan to work with licensing and joint venture partners to take the technology to market.~~

The Securities and Exchange Commission (“SEC”) defines “critical accounting policies” as those that require application of management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Not all of the accounting policies require management to make difficult, subjective or complex judgments or estimates. However, the following policies could be deemed to be critical within the SEC definition.

We recognize revenue ~~upon delivery~~when services are performed, and at the time of ~~equipment,~~shipment of products, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, fees are fixed or determinable, and collection of the related receivable is reasonably assured. Title to the equipment is transferred to the customer once the last payment is received. We record revenue as goods are shipped, and the equipment has been fully accepted by the customer. Generally, we extend credit to our customers and do not require collateral. We do not ship a product until we have a purchase agreement signed by the customer with a payment arrangement.

Revenues and related costs on construction contracts are recognized ~~using~~as the ~~“percentage of completion method” of accounting~~performance obligations for work are satisfied over time in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. Under ASC ~~605-35 – “~~~~Accounting for Performance of Construction-Type~~606, revenue and ~~Certain Production Type Contracts”.~~~~Under this method, contract revenues and related expenses are~~associated profit, will be recognized ~~over~~as the ~~performance period~~customer obtains control of the goods and services promised in the contract in direct proportion to the costs incurred as a percentage of total estimated costs for the entirety of the contract. Costs include direct material, direct labor, subcontract labor and any allocable indirect costs.(i.e., performance obligations). All un-allocable indirect costs and corporate general and administrative costs are charged to the periods as incurred. However, in the event a loss on a contract is foreseen, the Company will recognize the loss, as it is determined. Revisions in cost and profit estimates during the course of the contract are reflected in the accounting period in which the facts for the revisions become known. 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, including those arising from contract penalty provisions, and final contract settlements, may result in revisions to costs and income, which are recognized in the period the revisions are determined.

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts ~~reported in~~of assets and liabilities, disclosure of contingent assets and liabilities at the ~~accompanying financial statements. Significant estimates made in preparing these~~date of the financial statements, ~~include the estimate of useful lives of property and equipment, the deferred tax valuation allowance,~~ and the ~~fair value~~reported amounts of ~~stock options, warrants, convertible notes~~revenues and ~~common stock for services.~~expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include estimates used to review the Company’s goodwill, impairments and estimations of long-lived assets, revenue recognition on percentage of completion type contracts, allowances for uncollectible accounts, inventory valuation, valuations of non-cash capital stock issuances and the valuation allowance on deferred tax assets. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Fair value of financial instruments requires disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. As of ~~Nine months,~~September 30, 2023, the amounts reported for cash, prepaid expenses, accounts payable and accrued expenses approximate the fair value because of their short maturities.

Management reviewed accounting pronouncements issued during the three months ended September 30, 2017, and no pronouncements were believed by management to have a material impact on our present or future financial statements.

Results of Operations for the three months ended September 30, ~~2017~~2023 compared to the three months ended September 30, ~~2016.~~ 2022.

For the three months ended September 30, ~~2017,~~2023, we had revenue of ~~$1,112,438~~$1,363,840 compared to ~~$1,019,919~~$3,366,061 for the three months ended September 30, ~~2016.~~2022. Cost of sales for the three months ended September 30, ~~2017,~~2023 was ~~$949,657~~$1,135,541 compared to ~~$574,105~~$2,542,887 for the three months ended September 30, ~~2016.~~2022. Revenue and cost of sales ~~increased~~decreased primarily due to ~~PWT’s focus on operations.~~our subsidiary’s decrease in revenue.

Our gross profit was ~~$162,781~~$228,299 and ~~$445,814~~$823,174 for the three months ended September 30, ~~2017~~2023 and ~~2016,~~2022, respectively.

For the three months ended September 30, ~~2017,~~2023, we had selling and marketing expenses of ~~$539,975,~~$470,566 compared to ~~$303,496~~$712,420 for the three months ended September 30, ~~2016. Selling~~2022. The decrease in selling and marketing expenses ~~increased~~was primarily due to ~~an increase~~a decrease in ~~investor relations and~~ marketing expense.

~~General~~For the three months ended September 30, 2023, we had general and administrative expenses ~~increased~~of $904,223 compared to ~~$830,444,~~$1,085,044 for the three months ended September 30, ~~2017, compared~~2022. The decrease in general and administrative expenses was primarily due to ~~$629,455~~a decrease in professional and legal fees and outside services.

Other income and (expenses) decreased by $20,927,132 to $(7,140,597) for the three months ended September 30, ~~2016. General and administrative expenses increased primarily due~~2023, compared to ~~an increase in professional fees and outside services.~~

~~Research and development cost~~$(28,067,729) for the three months ended September 30, ~~2017 and 2016, were $53,939 and $106,259, respectively.~~2022. The decrease ~~in research and development costs~~ was due primarily ~~due~~ to a decrease in ~~outside services and other research and development costs.~~

~~Depreciation expense for the three months ended September 30, 2017 and 2016 was $12,961 and $11,331, respectively. The increase was primarily due to the purchase of fixed assets.~~

Other income and (expenses) for the three months ended September 30, 2017 and 2016, were $(3,603,099) and $(8,411,891), respectively. The decrease in other income and (expenses) was the result of a change in loss ofon non-cash accounts associated with the change in fair value of the derivatives in the amount of ~~$4,724,151, commitment fees~~$23,543,238, offset by an increase in present value of ~~$51,919 and interest expense~~convertible secured promissory notes of ~~$32,716, which includes non-cash amortization~~$1,690,500 an increase in impairment of ~~debt discount~~receivable of ~~$(17,308).~~$610,000, with an overall decrease in other expenses in the amount of $315,606.

Our net loss decreased by $20,757,557 to $(8,294,666) for the three months ended September 30, ~~2017 was $4,877,637,~~2023, compared to a net loss of ~~$9,016,618~~$(29,052,223) for the three months ended September 30, ~~2016.~~2022. The majority of the decrease in net loss was due primarily to a decrease in other expenses ~~consisting of a decrease in loss in non-cash accounts~~ associated with ~~derivatives along with an increase~~the net change in ~~revenue, offset by a decrease~~fair value of derivative instruments estimated each period. These estimates are based on multiple inputs, including the market price of our stock, interest rates, our stock price, volatility, variable conversion prices based on market prices defined in ~~gross profit.~~ the respective agreements and probabilities of certain outcomes based on managements’ estimates. These inputs are subject to significant changes from period to period, therefore, the estimated fair value of the derivative liabilities will fluctuate from period to period, and the fluctuation may be material.

Results of Operations for the nine months ended September 30, ~~2017~~2023 compared to the nine months ended September 30, ~~2016.~~2022.

For the nine months ended September 30, ~~2017,~~2023, we had revenue of ~~$2,294,891~~$5,200,918 compared to ~~$ 4,321,378~~$7,768,133 for the nine months ended September 30, ~~2016. Cost~~2022. The cost of sales for the nine months ended September 30, ~~2017,~~2023 was ~~$2,031,334~~$4,646,349 compared to ~~$2,899,507~~$6,484,235 for the nine months ended September 30, ~~2016.~~2022. Revenue and cost of sales decreased primarily due to ~~PWT’s focus on marketing.~~our subsidiary’s decrease in revenue.

Our gross profit was ~~$263,557~~$554,569 and ~~$1,421,871~~$1,283,898 for the nine months ended September 30, ~~2017~~2023 and ~~2016,~~2022, respectively.

For the nine months ended September 30, ~~2017,~~2023, we had selling and marketing expenses of ~~$2,165,213~~$1,915,809, compared to ~~$1,419,566~~$1,825,170 for the nine months ended September 30, ~~2016. Selling~~2022. The increase in selling and marketing expenses ~~increased~~was primarily due to an increase in ~~investor relations and~~ marketing expense.

General and administrative expenses ~~decreased to $1,842,815~~were $3,008,988 for the nine months ended September 30, ~~2017,~~2023, compared to ~~$1,860,239~~$2,900,203 for the nine months ended September 30, ~~2016. General~~2022. The increase in general and administrative expenses ~~decreased~~was primarily due to ~~our overall~~an increase in professional and legal fees including non-cash, shares for services expense ~~reduction efforts.~~and outside services.

~~Research~~Other income and ~~development cost~~(expenses) decreased by $16,633,802 to $(13,797,523) for the nine months ended September 30, ~~2017 and 2016, were $136,582 and $447,034, respectively. The decrease in research and development costs was primarily due~~2023, compared to ~~a decrease in salaries, outside services and other research and development costs.~~

~~Depreciation expense~~$(30,421,325) for the nine months ended September 30, ~~2017 and 2016,~~2022. The decrease was ~~$39,506 and $33,902, respectively. The increase was~~due primarily ~~due~~ to ~~the purchase of fixed assets.~~

~~Other income (expense) for the nine months ended September 30, 2017 and 2016, was $(4,739,243) and $(3,389,184), respectively. The increase in other expenses was primarily~~ a ~~result of a net change~~decrease in loss ofon non-cash accounts associated with the change in fair value of the derivatives in the amount of ~~$827,908, and a decrease in interest expense of $99,527 which includes non-cash amortization of debt discount of $(59,888),~~$27,938,016, offset by an increase in ~~commitment fees~~present value of ~~$621,684.~~convertible secured promissory notes of $7,728,089, an increase in impairment of receivable of $3,260,985, with an overall decrease in other expenses in the amount of $315,140.

Our net loss decreased by $15,713,484 to $(18,180,762) for the nine months ended September 30, ~~2017 was $8,659,802,~~2023, compared to a net loss of ~~$5,728,054~~$(33,894,246) for the nine months ended September 30, ~~2016.~~2022. The majority of the ~~increase~~decrease in net loss was due primarily to ~~an increase~~a decrease in other expenses ~~consisting of an increase in loss in non-cash accounts~~ associated with ~~derivatives~~the net change in fair value of derivative instruments estimated each period. These estimates are based on multiple inputs, including the market price of our stock, interest rates, our stock price, volatility, variable conversion prices based on market prices defined in the respective agreements and ~~a decrease in revenue~~probabilities of certain outcomes based on managements’ estimates. These inputs are subject to significant changes from period to period, therefore, the estimated fair value of the derivative liabilities will fluctuate from period to period, and ~~gross profit.~~the fluctuation may be material.

Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. Significant factors in the management of liquidity are funds generated by operations, levels of accounts receivable and accounts payable and capital expenditures.

The condensed consolidated financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. The accompanying condensed consolidated financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern. The Company has not generated significant revenue, and has negative cash flows from operations, which raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, raising additional ~~cash infusion.~~capital and increasing sales. We obtained funds from ~~our shareholders~~investors during the nine months ending September 30, 2017. Management believes the existing shareholders, the prospective new investors and future sales will provide the additional cash needed to meet the Company’s obligations as they become due, and will allow the development of its core business operations.2023. No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, it may contain ~~undue~~ restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in case of equity financing.

In connection with our sale of Series M Preferred Stock conducted under Regulation A under the Securities Act, we may be subject to claims for rescission. If this occurs, it may have a negative effect on our liquidity.

At September 30, ~~2017~~2023 and December 31, ~~2016,~~2022, we had cash of ~~$342,164~~$1,153,181 and ~~$351,321, respectively~~$1,354,814 and a working capital deficit of ~~$12,090,561~~$32,064,689 and ~~$11,056,570,~~$14,245,179, respectively. The increase in working capital deficit was due primarily to an increase in convertible promissory notes, non-cash derivative liabilities, ~~and convertible notes, contracts receivable, inventory assets, accounts payable,~~ accrued expenses ~~billing~~and contract liabilities.

During the period ended September 30, 2023, we raised a net aggregate of $516,300 from the sale of preferred stock in ~~excess of cost, deferred income,~~private placements and ~~loan payable, with~~$6,346,500 for WODI convertible secured promissory notes. Our ability to continue as a ~~decrease in cash, cost in excess of billing~~going concern is dependent upon raising capital from financing transactions and ~~prepaid expenses.~~future revenue.

Net cash used in operating activities was ~~$1,296,392~~$4,417,340 for the nine months ended September 30, ~~2017,~~2023, compared to ~~$910,129~~$3,458,023 for the prior period ended September 30, ~~2016.~~2022. The increase in cash used in operating activities was primarily due to an increase in ~~cost of goods sold.~~ value added to note purchase agreements, accrued expenses, non-cash derivative liabilities and accounts payable.

Net cash flows used in investing activities was ~~$33,845~~$3,007,285 for the nine months ended September 30, ~~2017, as~~2023, compared to ~~$5,699~~$17,138 for the prior period ended September 30, ~~2016.~~2022. The ~~net~~ increase in cash used in investing activities was primarily due to an increase in ~~equipment purchases in~~notes receivables during the current period.

Net cash flows provided by financing activities was ~~$1,321,122~~$7,222,992 for the nine months ended September 30, ~~2017,~~2023, as compared to ~~$1,088,217~~$4,544,966 for the prior period ended September 30, ~~2016.~~2022. The increase in cash provided by financing activities was due primarily to an increase in ~~equity financing through private placements.~~proceeds from issuance of convertible promissory notes. To date we have principally financed our operations through the sale of our common and preferred stock and the issuance of debt.

We do not have any material commitments for capital expenditures during the next twelve months. Although our proceeds from the issuance of ~~equity~~securities together with revenue from operations are currently sufficient to fund our operating expenses in the near future, we will need to raise additional funds in the future so that we can maintain and expand our operations. Therefore, our future operations are dependent on our ability to secure additional ~~financing.~~financing, which may not be available on acceptable terms, or at all. Financing transactions may include the issuance of equity or debt securities, obtaining credit facilities, or other financing mechanisms. However, the trading price of our common stock and a downturn in the U.S. equity and debt markets could make it more difficult to obtain financing through the issuance of equity or debt securities. Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses, fail to collect significant amounts owed to us, or experience unexpected cash requirements that would force us to seek alternative financing. Furthermore, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. The inability to obtain additional capital may restrict our ability to grow and may reduce our ability to continue to conduct business operations. If we are unable to obtain additional financing, ~~or generate sufficient revenue,~~ we may have to curtail our marketing and development plans and possibly cease our operations.

We have estimated our current average burn, and believe that we have assets to ensure that we can function without liquidation ~~over the next twelve months,~~for a limited time, due to our cash on hand, growing revenue, and our ability to raise money from our investor base. Based on the aforesaid, we believe we have the ability to continue our operations for the ~~foreseeable~~immediate future and will be able to realize assets and discharge liabilities in the normal course of operations. However, there cannot be any assurance that any of the aforementioned assumptions will come to fruition and as such we may only be able to function for a short time.

We do not have any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, and results of operations, liquidity or capital expenditures.

We are a smaller reporting company as defined by Rule 12b-2 of the ~~Securities~~ Exchange Act ~~of 1934~~ and are not required to provide the information under this item.

~~Pursuant to Rules 13a-15(b) and 15-d-15(b) under the Securities Exchange Act of 1934, as amended (“Exchange Act”), the Company~~We carried out an evaluation, under the supervision and with the participation of ~~the Company’s~~our management, including ~~the Company’s Chief Executive Officer~~our principal executive officer and ~~Chief Financial Officer (“CEO/CFO”)~~principal financial officer, of the effectiveness of ~~the Company’s~~our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered byin this ~~report. The term “disclosure~~report, our disclosure controls and ~~procedures”, as defined under Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other~~ procedures ~~of a company that are designed~~were effective to ensure that information required to be disclosed ~~by a company~~ in ~~the~~ reports ~~that it files or submits~~filed under the Exchange Act, is recorded, processed, summarized and reported within the required time periods specified in the SEC’s rules and ~~forms. Disclosure controls~~forms and ~~procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act~~ is accumulated and communicated to ~~the company’s~~our management, including ~~its~~our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

As disclosed in our annual report filing for the year ended December 31, 2016, there was a significant deficiency in the Company’s internal control over financial reporting due to a lack of segregation of duties due to small Company staff size. Based upon the evaluation of the disclosure controls and procedures at the end of the period covered by this report, the Company’s CEO/CFO concluded that the Company’s disclosure controls and procedures were ineffective due to the significant deficiency in the Company’s internal control over financial reporting.

To address the significant deficiency, we performed additional analysis and other post-closing procedures in an effort to ensure our condensed consolidated financial statements included in this review report have been prepared in accordance with generally accepted accounting principles. Accordingly, management believes that the financial statements included in this quarterly report on Form 10-Q fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented.

There were no changes in the Company’s internal control over financial reporting (as defined in Rule 13a-15f of the Exchange Act) that occurred during the ~~current period of 2017~~fiscal quarter ended September 30, 2023 that has materially affected, or are reasonably likely to materially affect, the ~~Company’s~~our internal control over financial reporting.

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

~~None~~There are no material updates to the litigation matters with C6 Capital, LLC as previously disclosed in the Form 10-K filed on April 17, 2023. As of the date of this filing, the Company views the C6 Capital matter as closed.

On July 12, 2023, OriginClear, Inc. entered into a Confidential Settlement and Mutual Release Agreement (the “Settlement Agreement”) with Auctus Fund, LLC (“Auctus”) relating to the settlement and release of certain pending legal actions arising out of various loans and agreements between the Company and Auctus. Pursuant to the terms of the Settlement Agreement, the Company and Auctus have resolved all outstanding legal disputes and claims between them. The appeal that was pending in the United States Court of Appeals for the First Circuit and trial matter in the United States District Court for the District of Massachusetts have been terminated and all transactions and obligations thereunder between the Company and Auctus are null and void. The terms and conditions of the Settlement Agreement are confidential and have no impact on the financial condition or operations of the Company. As of the date of this filing, the Company views the Auctus matter as closed.

~~We are~~Not required for a smaller reporting ~~company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.~~company.

~~None~~As of the date of the filing of this report, the Company has 60 shares of Series F preferred stock outstanding which the Company failed to redeem on September 1, 2020, for an aggregate redemption price (equal to the stated value) of $60,000.

As of the date of the filing of this report, the Company has 25 shares of Series G preferred stock outstanding which the Company was required to, and failed to redeem on April 30, 2021, for an aggregate redemption price (equal to the stated value) of $25,000.

As of the date of the filing of this report, the Company has 25 shares of Series I preferred stock outstanding which the Company was required to, and failed to redeem between May 2, 2021 and June 10, 2021, for an aggregate redemption price (equal to the stated value) of $25,000.

As of the date of the filing of this report, the Company has 307 shares of Series K preferred stock outstanding which the Company was required to, and failed to redeem between August 5, 2021 and March 26, 2022, for an aggregate redemption price (equal to the stated value) of $307,150.

As previously reported, the Company has commenced an offering under Regulation 506c of Regulation D (the “Private Placement”) of the Securities Act of 1933, as amended (the “Securities Act”) pursuant to which the Company shall sell units of its securities (the “Units”) with each Unit consisting of (i) one restricted share of its common stock, (ii) a Class A Warrant to purchase one share of its common stock, (iii) a Class B Warrant to purchase one share of its common stock, (iv) a Class C Warrant to purchase one share of its common stock and (v) a Class D Warrant to purchase one share of its common stock to qualified investors. The Company may redeem the warrants, but only after one year from the investor’s initial subscription, and only if the average stock price over a ten day period after that time is double the applicable warrant’s exercise price. If accelerating, the Company must reduce each exercise price by 25%. The subscription documents contain a lock-up provision under which, subject to certain terms and conditions therein, the subscribers shall not sell any of their shares of common stock of the Company obtained in this Offering for a period of twelve months. The securities offered in the Private Placement will not be and have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Between October 26, 2017 and November 13, 2017, the Company sold, in the Private Placement, an aggregate of 6,700,000 shares of its common stock to an accredited investor for an aggregate consideration of $167,500.

The securities referenced above were offered and sold pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act, and Rule 506(c) of Regulation D promulgated under the Securities Act.

~~Between October 31, 2017 and November 13, 2017, the Company issued to consultants an aggregate of 5,680,648 shares of the Company’s common stock in lieu of cash consideration.~~

~~The securities referenced above were offered and sold pursuant to an exemption from the registration requirements under Section 4(a)(2) of the Securities Act.~~

~~In connection with certain one-time make good agreements, on October 31, 2017, the Company issued an aggregate of 399,328 shares of its common stock to certain holders of its common stock.~~

The securities above were offered and sold pursuant to an exemption from the registration requirements under Section 4(a)(2) of the Securities Act since, among other things, the transactions did not involve a public offering.

Valuation Date	Fair Value of shares
12/28/2022	$	56.68
02/08/2023	$	106.67
06/15/2023	$	266.73
08/21/2023	$	54.58

Valuation Date	Fair Value of shares
06/27/2023	$	0.36
08/21/2023	$	0.37

	September 30, 2023
	Number of Warrants			Weighted average exercise price
Outstanding - beginning of period		93,344,989		$	0.1217
Granted		4,130,400		$	0.125
Exercised		-			-
Expired		(31,561,500	)	$	(0.05	)
Outstanding - end of period		65,913,889		$	0.1463

		September 30, 2023
						Weighted Average
						Remaining
Exercisable		Warrants		Warrants		Contractual
Prices		Outstanding		Exercisable		Life (years)
$	0.02		600,000		600,000		2.92
$	0.10		2,500,000		2,500,000		3.39
$	0.25		6,146,000		6,146,000		0.01 - 3.22
$	0.0275		8,727,273		8,727,273		7.66
$	0.125		46,380,616		46,380,616		3.27 - 4.92
$	1.00		1,560,000		1,560,000		0.75 - 1.21
			65,913,889		65,913,889

Convertible Promissory Notes	$	2,617,692
Less current portion		2,472,945
Total long-term liabilities	$	144,747

	September 30, 2017			December 31, 2016
	(Unaudited)
ASSETS

CURRENT ASSETS
Cash	$	342,164		$	351,321
Contracts receivable, less allowance for doubtful accounts of $50,000 and $50,000 respectively		523,548			382,895
Inventory		13,614			-
Cost in excess of billing		9,238			47,612
Work in progress		84,157			86,085
Prepaid expenses		17,991			42,128

TOTAL CURRENT ASSETS		990,712			910,041

NET PROPERTY AND EQUIPMENT		156,252			161,912

OTHER ASSETS
Other asset		19,538			19,538
Goodwill		682,145			682,145
Trademark		4,467			4,467
Security deposit		3,500			3,500
TOTAL OTHER ASSETS		709,650			709,650
TOTAL ASSETS	$	1,856,614		$	1,781,603

LIABILITIES AND SHAREHOLDERS’ DEFICIT

Current Liabilities
Accounts payable and other payable	$	830,539		$	480,064
Accrued expenses		847,114			715,281
Billing in excess of cost		233,394			-
Customer deposit		113,950			113,950
Warranty reserve		20,000			20,000
Loans payable, current portion		11,090			-
Derivative liabilities		10,728,464			8,702,083
Convertible promissory notes, net of discount of $54,440 and $591,835, respectively		296,722			1,935,233
Total Current Liabilities		13,081,273			11,966,611

Long Term Liabilities
Loan payable, long term portion		12,282			-
Convertible promissory notes, net of discount of $235,268 and $11,429, respectively		3,080,628			1,613,571
Total Long Term Liabilities		3,092,910			1,613,571
Total Liabilities		16,174,183			13,580,182

SHAREHOLDERS’ DEFICIT
Preferred stock, $0.0001 par value, 25,000,000 shares authorized 6,666 shares of Series B issued and outstanding, respectively		1			1
1,000 shares of Series C issued and outstanding, respectively		-			-
Common stock, $0.0001 par value, 300,000,000 shares authorized 78,151,781 and 21,428,454 equity shares issued and outstanding, respectively		7,815			2,143
Preferred treasury stock, 1,000 and 1,000 shares of Series C outstanding, respectively		-			-
Additional paid in capital		57,564,158			51,428,976
Accumulated other comprehensive loss		(134	)		(92	)
Accumulated deficit		(71,889,409	)		(63,229,607	)
TOTAL SHAREHOLDERS’ DEFICIT		(14,317,569	)		(11,798,579	)
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT	$	1,856,614		$	1,781,603

									Additional		Accumulated Other
	Preferred stock				Common stock				Paid-in		Comprehensive			Accumulated
	Shares		Amount		Shares		Amount		Capital		loss			Deficit			Total
Balance at December 31, 2016		7,666	$	1		21,433,571	$	2,143	$	51,428,976	$	(92	)	$	(63,229,607	)	$	(11,798,579	)

Common stock issuance for cash		-		-		10,775,722		1,078		1,296,672		-			-			1,297,750

Common stock issuance for conversion of debt		-		-		9,321,555		932		1,234,040		-			-			1,234,972

Common stock issuance for settlement of accounts payable		-		-		886,700		89		117,842		-			-			117,931

Common stock issued at fair value for services and commitment fees		-		-		35,734,233		3,573		3,415,025		-			-			3,418,598

Stock compensation cost		-		-		-		-		71,603		-			-			71,603

Other comprehensive loss		-		-		-		-		-		(42	)		-			(42	)

Net loss for the nine months ended September 30, 2017		-		-		-		-		-		-			(8,659,802	)		(8,659,802	)

Balance at September 30, 2017 (unaudited)		7,666	$	1		78,151,781	$	7,815	$	57,564,158	$	(134	)	$	(71,889,409	)	$	(14,317,569	)

	Nine Months Ended
	September 30, 2017			September 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(8,659,802	)	$	(5,728,054	)
Adjustment to reconcile net loss to net cash used in operating activities
Depreciation and amortization		39,506			33,902
Common stock and warrants issued for services		3,418,598			1,787,902
Stock option and warrant compensation expense		71,603			155,112
Loss on net change in valuation of derivative liability and conversion of debt		2,787,138			1,959,230
Debt discount and original issue discount recognized as interest expense		313,546			373,434
Change in Assets (Increase) Decrease in:
Contracts receivable		(140,653	)		675,188
Cost in excess of billing		38,374			(12,954	)
Inventory asset		(13,614	)		-
Prepaid expenses		24,137			1,797
Work in progress		1,928			518
Other asset		-			(88,548	)
Change in Liabilities Increase (Decrease) in:
Accounts payable		468,406			299,584
Accrued expenses		121,047			257,501
Billing in excess of cost		209,294			(474,741	)
Deferred income		24,100			(150,000	)

NET CASH USED IN OPERATING ACTIVITIES		(1,296,392	)		(910,129	)

CASH FLOWS USED FROM INVESTING ACTIVITIES:
Purchase of fixed assets		(33,845	)		(5,699	)

CASH USED IN INVESTING ACTIVITIES		(33,845	)		(5,699	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Loans payable		23,372			-
Proceeds from convertible promissory notes		-			125,000
Proceeds for issuance of common stock for cash		1,297,750			963,217

NET CASH PROVIDED BY FINANCING ACTIVITIES		1,321,122			1,088,217

Foreign currency effect on cash flow		(42	)		(23	)

NET (DECREASE) INCREASE IN CASH		(9,157	)		172,366

CASH BEGINNING OF PERIOD		351,321			695,295

CASH END OF PERIOD	$	342,164		$	867,661

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid	$	1,823		$	2,199
Taxes paid	$	-		$	-

SUPPLEMENTAL DISCLOSURES OF NON CASH TRANSACTIONS
Common stock issued at fair value for conversion of debt and accrued interest	$	1,234,972		$	878,040
Common stock issued at fair value on settlement of accounts payable	$	117,931		$	-
Common stock issued at fair value for supplemental shares	$	1,409,655		$	787,971
Beneficial conversion feature on convertible note	$	-		$	16,771
Conversion of accounts payable into a convertible note	$	-		$	430,896

Balance as of January 1, 2017	$	8,702,083
Fair Value of derivative liabilities issued		-
Change in derivative liability, excluding loss on settlement of debt		2,026,381
Balance as of September 30, 2017		10,728,464

Convertible Promissory Notes	$	3,667,068
Less debt discount		289,718
Convertible Promissory Notes, net of discount	$	3,377,350
Less current portion		296,722
Long term portion	$	3,080,628

Period Ending September 30,	Amount
2023		597,945
2024		1,875,000
2026		13,772
2028		130,975
	$	2,617,692

	September 30, 2017
			Weighted
	Number of		average exercise
	Options		price
Outstanding, beginning of period		3,697,495	$	1.505
Granted		-		-
Exercised		-		-
Forfeited/Expired		-		-
Outstanding, end of period		3,697,495	$	1.505
Exercisable at the end of the period		2,682,644	$	1.035
Weighted average fair value of options granted during the period			$	-

						Weighted Average
		Stock		Stock		Remaining
Exercisable		Options		Options		Contractual
Prices		Outstanding		Exercisable		Life (years)
$	6.65 - 147.00		52,276		50,401		4.84 - 7.02
$	10.15 - 15.40		32,362		32,362		5.96
$	1.31		3,612,857		2,599,881		3.22 - 4.05
			3,697,495		2,682,644

	Nine Months Ended
	September 30,
	2023		2022
Equipment Contracts	$	2,174,949	$	5,829,960
Component Sales		901,932		1,390,243
Waste Water Treatment Systems		1,660,625		325,005
Pump Stations		364,945		179,005
Rental Income		19,719		19,719
Services Sales		36,095		24,201
Internet Sales		39,390		-
Commission & Training		3,263		-
	$	5,200,918	$	7,768,133

	September 30, 2017
				Weighted
	Number			average
	of			exercise
	Warrants			price
Outstanding-beginning of the period		506,026		$	5.25
Granted		22,825,000		$	0.02
Exercised		-			-
Forfeited		(27,296	)	$	(22.37	)
Outstanding - end of the period		23,303,730		$	0.13

	●	~~intellectual property;~~

	●	~~production;~~

	●	future operating results; and

	●
	●	plans, objectives, expectations, and intentions contained in this report that are not historical.

	●	An incubated outsourced water treatment business called Water On Demand (“WOD”). The WOD model intends to offer private businesses water self-sustainability as a service - the ability to pay for water treatment and purification services on a per-gallon basis. This is commonly known as Design-Build-Own-Operate (“DBOO”).

	●	~~OriginClear’s Facebook Page (https://www.facebook.com/OriginClear)~~NOTE: The Company did not spin off the companies known as the WOD Subsidiaries. The funds the Company raises for these entities shall continue to be held by the Company and made available for use by WODI, to be deployed subject to a planned management contract.

Exhibit Number		Description of Exhibit

3131.1		Certification by Chief Executive Officer, ~~and~~required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.*
31.2		Certification by Chief Financial Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.*
3232.1		Certification byof Chief Executive Officer ~~and~~pursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2		Certification of Chief Financial Officer ~~required by Rule 13a-14(b) or Rule 15d-14(b)~~pursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906 of the ~~Exchange~~Sarbanes-Oxley Act ~~and Section 1350~~ of ~~Chapter 63 of Title 18 of the United States Code.~~2002.*
101.INS		Inline XBRL Instance Document.*
101.SCH		Inline XBRL Taxonomy Extension Schema.*
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase.*
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase.*
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase.*
101.PRE		Inline XBRL Extension Presentation Linkbase.*

December 8, 2023	ORIGINCLEAR, INC.

	~~By:~~	/s/ TT. Riggs Eckelberry
		TT. Riggs Eckelberry
		Chief Executive Officer ~~(Principal Executive Officer) and~~
	(Principal Executive Officer)

	~~Acting Chief Financial Officer~~ ~~(Principal Accounting and Financial Officer)~~/s/ Prasad Tare
		Prasad Tare
	Chief Financial Officer
	~~November 14, 2017~~(Principal Financial and Accounting Officer)