C LEAN E NERGY T ECHNOLOGIES , I NC .

ESCROW FUNDING AGREEMENT

This E SCROW F UNDING A GREEMENT (this “ Agreement ” ) dated as of November 1, 2016 is made

by and between Clean Energy Technologies, Inc., a Nevada corporation (the “ Company ” ) and Red Dot

Investment, Inc., a California corporation ( “ Lender ” ).

R ECITALS

W HEREAS on or about March 15, 2016 the Company and   Peak One Opportunity Fund, L.P., a

Delaware limited partnership ( “ Peak One ” ) entered into a Securities Purchase Agreement dated March

11, 2016 (the “ SPA ” ).

W HEREAS   pursuant   to   the   SPA,   on   March   15,   2016   Peak   One   subscribed   for   and   purchased

from   the   Company   and   the   Company   issued   to   Peak   One   a   Convertible   Debenture   dated   March   15,

2016   in   the   original   stated   principal   amount   of   $75,000.00   (as   originally   issued   and   as   amended   as

provided herein, the “ Convertible Debenture ” ).

W HEREAS ,   concurrently   herewith,   the   Company   is   issuing   a   redemption   notice   to   Peak   One

relating   to   the   Convertible   Debenture,   pursuant   to   which   the   Company   elected   to   redeem   all   of   the

remaining   outstanding   balance   of   the   Convertible   Debenture   for   an   aggregate   redemption   price   of

$84,000.00.

W HEREAS ,   prior   to   issuing   the   redemption   notice,   the   Company   did   not   have   the   funds   to

redeem the Convertible Debenture, but   Section 2(b)(iii) of the Convertible Debenture called for there

to be in escrow sufficient funds to effect a redemption of the Convertible   Debenture   prior to   the time

of issuing a redemption notice.

W HEREAS , in compliance with the terms of the Convertible Debenture, Lender is concurrently

herewith   depositing   in   escrow   with   Richardson   &   Maloney   LLP   (the   “ Escrow   Holder ” )   sufficient

funds to effect the redemption and pay any redemption related costs (the “ Escrow ” ).

W HEREAS , as a condition to such deposit, and in accordance with the terms of the Convertible

Debenture   and   the   SPA,   the   Company   agrees   to   assign   to   Lender   all   of   the   Company ’ s   rights   to

repurchase the Convertible Debenture   through redemption, effective upon issuance of the redemption

notice.

W HEREAS ,   pursuant   to   the   instructions   of   Lender   and   the   Company contained   herein,   Lender

and   the   Company   are   instructing   the   Escrow   Holder   to   disburse   funds   from   the   Escrow   to   fund   the

entirety   of   the   Company ’ s   redemption   of   the   Convertible   Debenture   and   all   costs,   expenses,   fees   or

other   charges   arising   in   connection   with   or   relating   to   the   redemption   of   the   Convertible   Debenture,

the assignment of the Company ’ s rights relating thereto, the amendment of the Convertible Debenture

once    acquired    by    Lender,    this    Agreement,    the    transactions    contemplated    herein,    including    the

Financing   Fee   (as   defined   below)   and   any   costs,   expenses,   or   other   fees   relating   to   the   Convertible

Debenture or its enforcement and collection, and any other expense for or on account of the Company

for   which   an   agent   of   the   Company   may   request   an   advance,   provided   such   advance   is   approved   by

the    Executive    Chairman    of    the    Company    or    the    Escrow    Holder    (collectively,    the    “ Ancillary

Expenses ” ).

W HEREAS   Lender   has   agreed   that   Lender   will   only   acquire   the   rights   of   the   Company   with

respect to the Convertible Debenture and   that   Lender is acquiring the Convertible Debenture through

Escrow, including through subrogation to the rights of Peak One, and is not purchasing the Convertible

Debenture from the Company, and that, as a result, Lender is acquiring the Convertible Debenture as

a good faith purchaser for value and a holder in due course, but Lender does not acquire the Convertible

Debenture   with   any   representation   or   warranty   from   Peak   One   other   than   as   implied   by   Peak   One   to

the Company, as assignor, with respect to its ownership of the Convertible Debenture.

W HEREAS   Lender   and   the   Company   have   agreed   that   the   Convertible   Debenture   will   govern

the rights between Lender and the Company and they have agreed to amend the Convertible Debenture,

once   acquired   by   Lender   or   once   Lender   is   subrogated   to   the   rights   thereunder,   (a)   to   have   a   fixed

conversion price of $.005 per share, subject to limited potential adjustment, (b) to have a fixed interest

rate   of   ten   percent   (10%)   per   annum   with   respect   to   both   the   Peak   One   redemption   amount   and   any

Ancillary   Expenses   (in   each   case   with   a   minimum   10%   yield   in   the   event   of   payoff   or   conversion

within  the  first  year),  as  provided  herein,  all  such    expenses  to  be  for  the  account  of  and  the

responsibility   of   the   Company,   notwithstanding   that   Lender   may   advance   sums   to   pay   for   them,   the

amount of such Ancillary Expenses to constitute additional principal under the Convertible Debenture,

as amended, and (c) as otherwise provided herein.

A GREEMENT

N OW ,  T HEREFORE ,    in    consideration    of    the    premises    and    for    other    good    and    valuable

consideration,   the   receipt   and   sufficiency   of   which   are   hereby   acknowledged,   the   parties   to   agree   as

follows:

1.

Recitals;   Terms .    The   foregoign   Recitals   are   incorproated   herin   by   refernce   as   if   set

forth fully herein and, in accodacne with Section 622 of the California Evidence Code, the facts recited

in the Recitals are conclusively presumed   to be true as between the parties hereto, or their successors

in interest.  Capitalized terms used but not defined in this Agreement shall have the meanings ascribed

thereto in the Convertible Debenture (including any terms incorproated by reference therein).

2.

Escrow Deposit; Debenture Assignment; Promise to Pay .

(a)

Upon   and   subject   to   the   terms   and   conditions   set   forth   in   this   Agreement,

Lender   has   designated   and   hereby   reaffirms   such   designation,   from   funds   on   deposit   in   the

Escrow  with  the  Escrow  Holder,  sufficient  funds  to  effect  the  redemption  and  pay  any

Ancillary Expenses.  The total of such amounts (the “ Owed Principal Amount ” ) shall be as set

forth   in   a   schedule   (the   “ Loan   Schedule ” )   prepared and   updated   by   Lender   from   time to time

and that may be appended or re-appended by Lender to the Convertible   Debenture (or a copy

thereof if Lender does not receive the original of the Convertible Debenture).   The parties agree

that the Loan Schedule, as prepared by Lender from time to time and whether or not appended

to   the   Convertible   Debenture   (or   a   copy   thereof),   shall   conclusive   evidence   of   the   Owed

Principal Amount.

(b)

The Company represents and warrants to Lender that, currently with the above

the Company has issued the redemption notice for the Convertible Debenture.

(c)

As   a   condition   to   such   designation,   and   in   accordance   with   the   terms   of   the

Convertible   Debenture   and   the   SPA,   immediately after   the   issuance   of the   redemption   notice

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as provided in Section 2(b) above, the Company hereby assign to Lender all of the Company ’ s

rights to repurchase the Convertible Debenture.

(d)

To   induce   Lender   to   acquire   the   Convertible   Debenture,   the   Company   agrees

to pay to Lender a fee of $10,000.00 (the “ Financing Fee ” ), with the amount of the Financing

Fee to be included as an Ancillary Expenses.

(e)

In   consideration   of   the   foregoing,   the   Company   hereby   agrees   to   repay   to

Lender, in accordance with the terms and conditions of the Convertible Debenture as amended

hereby, the Owed Principal Amount, together with interest accrued thereon and other amounts

owing in connection therewith (including all Ancillary Expenses), as any such amounts be due

and owing and whether or not reflected in the Loan Schedule.

3.

Escrow   Instruction .     Lender   and   the   Company   hereby   jointly   instruct   the   Escrow

Holder   to   disburse   funds   from   the   Escrow   to   fund   the   entirety   of   the   Company ’ s   redemption   of   the

Convertible Debenture and to pay from the Escrow any and all Ancillary Expenses, inculding the legal

expenses incurred in connection with the preparation of this Agreement and the expenses of the Escrow

Holder.    At   the   request   of   the   Escrow   Holder,   Lender   shall   conifrm   in   writing   the   Escrow   Holder ’ s

payment   of   Ancillary   Expenses   and   Escrow   Holder ’ s   authortiy   threfor,   though   no   such   confirmation

shall   be required, it   being agreed   between the   parties   that   the   Escrow   Holder shall   have   the   authority

to pay such expenses as they are invoiced.

4.

Amendments   to   Convertible   Debenture .    Lender   and   the   Company agree   to   amend

the   Convertible  Debenture,  once  acquired   by   Lender   or   once   Lender   is   subrogated   to   the   rights

thereunder,  as  follows:    (a)  the  first  paragraph  of  the  Convertible  Debenture  is  amended  by   (i)

substituting   Lender   and   its   information   for   Peak   One   and   its   information,   (ii) changing the   definition

of   “ Principal   Amount ”   to   mean   the   Owed   Principal   Amount,   (iii)   deleting   the   second   sentence,   (iv)

deleting   all   of   the   third   sentence   but   keeping   the   definition   of   “ Common   Stock, ”   and   (v)   in   the   last

sentence,   deleting   all   words   between   the   word   “ time ”   and   the   period;   (b)   Section   2(a)   is   amended   to

provide   that   all   amounts   due   under   the   Convertible   Debenture,   including   the   Principal   Amount   and

interest   acrued   thereon,   shall   be   convertible   into   Common   Stock   at   a   fixed   conversion   price   of $.005

per    share,    subject    to    equitable    adjustments    resulting    from    any    stock    splits,    stock    dividends,

recapitalizations,   or   similar   events   or   events   with   similar   effect;   provided   that,   if   any   amount   of   any

Note   shall   be   convertible   into   Common   Stock   at   a   price   per   share   that   is   less   than   $0.002   per   share,

then, at   the election   of the Holder, the conversion   price   shall   be adjusted   to be   equal   the   lowest   price

at   which   any   such   amount   of   a   Note   shall   be   converted   into   Common   Stock   (subject   to   the   same

equitable adjustments), with any such adjustment to be for the benefit of the Holder and, at the Holder ’ s

election, one or more other holders of Common Stock as of November 1, 2016; (c) Section 2(b) of the

Convertible Debenture is deleted in its entirety; (d) Section 3 is deleted in its entirety and replaced with

the following “ Any amount owed under this Debenture may be converted at the election of the Holder

prior to, at or after the Maturity Date. ” ; (e) the first four sentences of Section 9 are amended and restated

to provide that the Convertible Debenture shall be governed by the law of the State of Nevada and that

any dispute or other matter between the parties shall be submitted to expedited commerical arbitration

before   Pan   Pacific   Arbitration   in   accorance   with   Section   13   below;   (f)   interest   shall   acrue   from   the

date hereof on all Owed Principal Amount at a rate per annum equal to   ten percent (10%) per annum,

with  a  minimum  interest  accrual  of  10%  of  the  Principal  Amount  in  the  event  the  Convertible

Debenture   is   converted   or repaid   within   one   year,   and   (g)   the   Convertible   Debenture   shall   entitle   the

Holder   to   voite   on   all   matters   on   which   holders   of   Common   Stock   are   entitled   to   vote,   including   the

election   of directors,   on an   as-converted basis,   based   on the maximum   number   of shares   of Common

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Stock   into   with   the   Convertible   Debenture   is   convertible,   applying   any   then-applicable   conversion

limitation.

5.

Events   of   Default .     In   addition   to   the   Events   of   Default   listed   in   the   Convertible

Debenture, the occurrence of any of the following shall also constitute an “ Event of Default ” under the

Convertible Debenture and this Agreement:

(a)

Failure   to   Pay.     The   Company   shall   fail   to   pay   when   due   any   outstanding

amount owed under the Convertible Debenture;

(b)

Cross   Default.    A   default   shall   occur   in   any   other   obligation   of   the   Company

to pay money or to perform an obligation when due;

(c)

Voluntary   Bankruptcy   or   Insolvency   Proceedings.     The   Company   shall   (i)

apply for or consent to the appointment of a receiver, trustee, liquidator or custodian of itself or of all

or   a   substantial   part   of   its   property,   (ii)   be   unable,   or   admit   in   writing   its   inability,   to   pay   its   debts

generally as   they mature, (iii) make   a   general   assignment   for   the   benefit   of its   or   any of its   creditors,

(iv) be dissolved or liquidated, (v) become insolvent (as such term may be defined or interpreted under

any   applicable   statute),   (vi)   commence   a   voluntary   case   or   other   proceeding   seeking   liquidation,

reorganization   or   other   relief   with   respect   to   itself   or   its   debts   under   any   bankruptcy,   insolvency   or

other   similar   law   now   or   hereafter   in   effect   or   consent   to   any   such   relief   or   to   the   appointment   of   or

taking possession of its property by any official in an involuntary case or other proceeding commenced

against it, or (vii) take any action for the purpose of effecting any of the foregoing; or

(d)

Involuntary  Bankruptcy    or    Insolvency    Proceedings.      Proceedings    for    the

appointment of a receiver, trustee, liquidator or custodian of the Company or of all or a substantial part

of the property thereof, or an involuntary case or other proceedings seeking liquidation, reorganization

or   other   relief with   respect   to   the   Company or   the   debts   thereof under   any bankruptcy,   insolvency or

other similar law now or hereafter in effect shall be commenced and an order for relief entered or such

proceeding shall not be dismissed or discharged within thirty (30) days of commencement.

6.

Rights of Lender upon Default .  In addition to any remedies listed in the Convertible

Debenture   or   available   at   law   or   in   equity,   upon   the   occurrence   and   during   the   continuance   of   any

Event   of   Default   (and   giving   effect   to   any   applicable   cure   periods)   and   at   any   time   thereafter   during

the  continuance  of  such  Event  of  Default,    Lender  may  declare  all  amounts  payable    under  the

Convertible Debenture to be and become immediately due and payable, whereupon such amounts shall

be immediately due and payable in full.  In addition to the foregoing remedies, upon the occurrence or

existence   of   any   Event   of   Default,   Lender   may   exercise   any   other   right   power   or   remedy   otherwise

permitted to it by law, either by suit in equity or by action at law, or both.

7.

No  Assignment  by  the  Company .    Neither  this  Agreement  nor  the  Convertible

Debenture nor any of the rights, interests, or obligations of the Company hereunder or thereunder may

be   assigned,   in   whole   or   in   part,   by   the   Company,   including   by   operaiton   of   law,   without   the   prior

written consent of Lender.

8.

Waiver  and  Amendment.    Any  provision  of  this  Agreement  may  be  amended,

waived, or modified upon the written consent of Company and the Lender.

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9.

Notices .

All     notices,     requests,     demands,     consents,     instructions,     or     other

communications   required   or   permitted   hereunder   shall   be   in   writing   and   faxed,   emailed,   mailed,   or

delivered to each party at   the respective addresses of the parties   provided for   such purpose.    All such

notices and communications will be deemed given when sent to an address of the reciptient.   Any party

hereto may by notice so given change its address for future notice hereunder.

10.

Payment.  Payment shall be made in lawful tender of the United States.

11.

Expenses.  If action is instituted to collect   on the Convertible Debenture or to enforce

any right under this Agreement, the prevailing party shall pay all costs and expenses, including, without

limitation, attorneys ’ fees and costs, incurred in connection   with such action.

12.

Governing Law.   All questions concerning the construction, validity, enforcement and

interpretation of this Agreement shall be governed by and construed and enforced in accordance with

the internal laws of the State of Nevada, without regard to the principles of conflicts of law thereof.

13.

Arbitration;   Waiver   of   Right   to   Trial   by   Jury .    Any dispute,   controversy   or   claim

arising   from   or   connected   with   this   Agreement,   including   one   regarding   the   existence,   validity   or

performance   of   this   Agreement   or   the   Convertible   Debenture   (a   “ Dispute ” )   shall   be   referred   to   and

finally  resolved  by  arbitration  under  the  expedited  commercial  arbitration  rules  of  Pan  Pacific

Arbitration.    TO THE FULLEST EXTENT PERMITTED BY APPLICABLE   LAW, EACH PARTY

HERETO HEREBY IRREVOCABLY   WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN

ANY   LEGAL   PROCEEDING   ARISING   OUT   OF   OR   RELATING   TO   THIS   AGREEMENT,   THE

CONVERTIBLE  DEBENTURE,  OR   THE   TRANSACTIONS   CONTEMPLATED   HEREBY  OR

THEREBY.

14.

Usury Limitations .  It is the intention of the Company and Lender to conform strictly

to applicable usury laws.  Accordingly, notwithstanding anything to the contrary in this   Agreement or

the Convertible Debenture, amounts deemed to constitute interest under applicable law and contracted

for, chargeable, or receivable under this Agreement or under the Convertible Debenture shall under no

circumstances,  together  with    any  other    interest,  late    charges,    or    other    amounts    which    may  be

interpreted to be interest contracted for, chargeable, or receivable hereunder or thereunder, exceed the

maximum   amount   of   interest   permitted   by   law,   and   in   the   event   any   amounts   were   to   exceed   the

maximum   amount   of   interest   permitted   by   law,   such   excess   amounts   shall   be   deemed   a   mistake   and

shall either be reduced immediately and automatically to the maximum amount permitted by law or, if

required to comply with applicable law, be canceled automatically and, if theretofore paid, at the option

of   Lender,   be  refunded   to   the  Company   or   credited   on   the   principal   amount   of  the   Convertible

Debenture then outstanding.

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I N   W ITNESS   W HEREOF ,   the   Company   and   Lender   have   each   caused   this   Escrow   Funding

Agreement   to   signed   by   their   duly   appointed   and   authorized   officers   as   the   act   and   deed   of   such

company as of the date first written above.

CLEAN ENERGY TECHNOGIES, INC.,

a Nevada corporation

By:

Kambiz Mahdi

Chief Executive Officer

RED DOT INVESTMENT, INC.,

a California corporation

By:

Ted Hsu

Chief Executive Officer

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