Coil Tubing Technology 10Q 2009 Q1 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarter ended March 31, 2009

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

For the transition period from __________ to __________

Commission file number: 333-144677

COIL TUBING TECHNOLOGY HOLDINGS, INC.

(Exact name of small business issuer as specified in its charter)

NEVADA	76-0625217
(State or other jurisdiction of	(IRS Employer Identification No.)
incorporation or organization)

19511 Wied Rd. Suite E

Spring, Texas 77388

(Address of principal executive offices)

281-651-0200

(Registrant's telephone number)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities 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. þ Yes o 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). o Yes o No

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

Large Accelerated Filer o	Accelerated Filer o
Non-Accelerated Filer o	Smaller reporting companyþ

(Do not check if a smaller reporting company)

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

As of June 15, 2009, there were outstanding 22,050,000 shares of the registrant’s common stock, $.001 par value per share, which amount does not include 750,000 shares which the registrant has agreed to issue to Charles Wayne Tynon, as described below under “Item 2. Unregistered Sales of Equity Securities And Use Of Proceeds,” which have not been physically issued to date.

PART I -- FINANCIAL INFORMATION

ITEM1. FINANCIAL STATEMENTS

COIL TUBING TECHNOLOGY HOLDINGS, INC.

Consolidated Balance Sheets

March 31, 2009 and December 31, 2008

ASSETS

	March 31,2009 (unaudited)			December 31, 2008
CURRENT ASSETS:
Cash	$	24,388			$	60,909
Accounts receivable, net		43,973				181,782
Total Current Assets		68,361				242,691

Rental tools, net		356,175				374,068

Machinery and equipment, net		48,097				65,264

Other assets		5,850				3,980

TOTAL ASSETS	$	478,483			$	686,003

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:
Accounts payable and accrued expenses	$	31,091			$	166,502
Total Current Liabilities		31,091				166,502

Total Liabilities		31,091				166,502

Commitments

STOCKHOLDERS’ EQUITY:
Preferred Stock at $0.001 par value: 10,000,000 authorized; 1,000,000 shares issued and outstanding, as of March 31, 2009 and December 31, respectively		1,000				1,000
Common stock at $0.001 par value; 500,000,000 authorized; 22,050,000 and 21,000,000 shares issued and outstanding, as of March 31, 2009 and December 31, 2008 respectively		22,050				21,000
Additional paid-in capital		2,714,112				2,691,162
Accumulated deficit		(2,289,770	)			(2,193,661	)
Total Stockholders’ Equity		447,392				519,501

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	478,483			$	686,003


See accompanying notes to the consolidated financial statements

F-1

COIL TUBING TECHNOLOGY HOLDINGS, INC

Consolidated Statements of Operations

For the Three Month Periods Ended March 31, 2009 and 2008

(Unaudited)

	March 31, 2009			March 31, 2008

Revenue:
Product sales	$	23,428		$	412,093
Rental income		111,566			170,569
Total revenue		134,994			582,662

Cost of sales: Cost of sales products and rental income Cost of sales - depreciation		18,521 38,689			152,863 31,783
Total cost of sales		57,210			184,646

Gross profit		77,784	��		398,016

Operating expenses:
General and administrative		142,844			238,153
Depreciation and amortization		5,326			3,846
Total operating expenses		148,170			241,999

Income (loss) from continuing operations		(70,386	)		156,017
Loss on sale of assets		(1,942	)		-
Loss from discontinued operations		(23,781	)		(23,514	)

Net income (loss)	$	(96,109	)	$	132,503

Basic and diluted loss per share:
Continuing operations	$	0.00		$	0.00
Discontinued operations	$	0.00		$	0.00

Weighted common shares outstanding – basic and diluted		21,980,000			21,000,000

See accompanying notes to the consolidated financial statements.

F-2

COIL TUBING TECHNOLOGY HOLDINGS, INC.

Consolidated Statements of Cash Flows

For the Three Month Periods Ended March 31, 2009 and 2008

(Unaudited)

	March 31, 2009			March 31, 2008
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(96,109	)	$	132,503
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation		44,015			35,629
Gain/Loss on sale of asset		1,942			-
Changes in assets and liabilities:
(Increase) decrease in accounts receivable		137,809			(16,058	)
(Increase) decrease in other assets		(1,871	)		500
Increase (decrease) in accounts payable and accrued expenses		(111,411	)		(16,013	)
Increase (decrease) in customer deposits		-			(62,685	)

Cash provided by (used in) Operating Activities		(25,625	)		73,876

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of machinery and equipment		(24,296	)		(35,139	)
Proceeds from sale of machinery and equipment		13,400			-
Net Cash from Investing Activities		(10,896	)		(35,139	)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from capital contributions		-			500,000
Net Cash from Financing Activities		-			500,000

NET INCREASE (DECREASE) IN CASH		(36,521	)		538,737

CASH AT BEGINNING OF PERIOD		60,909			170,411
CASH AT END OF PERIOD	$	24,388		$	709,148

SUPPLEMENTAL SCHEDULE OF CASH FLOW ACTIVITIES:
Cash Paid For:
Income taxes	$	-		$	-
Interest	$	-		$	-

See accompanying notes to the consolidated financial statements.

F-3

COIL TUBING TECHNOLOGY HOLDINGS, INC.

Notes to the Consolidated Financial Statements

(Unaudited)

NOTE 1 - ORGANIZATION AND OPERATIONS

Coil Tubing Technology Holdings, Inc. (the “Company”) was incorporated on July 2, 1999 under the laws of the State of Texas. In May 2007, the Company converted to a Nevada corporation. The Company specializes in the design of proprietary tools for the coil tubing industry. The Company concentrates on four categories of coil tubing applications: thru tubing fishing, thru tubing work over, pipeline clean out, and coil tubing drilling. The Company supplies a full line of tools to oil companies, coiled tubing operations and service companies.

The Company is a majority owned subsidiary of Coil Tubing Technology, Inc., a Nevada corporation, (“Coil Tubing”) which is a non-reporting company. Coil Tubing agreed to distribute to its shareholders of record, date yet to be determined, 100% of the common shares of the Company that it owns totaling 20,000,000 million shares or 95% of the issued and outstanding shares. Subsequent to the spin-off, Coil Tubing will no longer have an ownership interest in the Company. Notwithstanding the legal form of the distribution, the distribution will be accounted for as a reverse spin off in accordance with Emerging Issues Task Force Issue No. 02-11, “Accounting for Reverse Spin-offs.” Accordingly, the Company is considered the divesting entity and treated as the “accounting successor” to Coil Tubing for financial reporting purposes. This is required because the business transferred generated all of Coil Tubing revenue and constituted a majority of its book value. Coil Tubing will be treated as discontinued operations following the spin-off.

As a result of the application of EITF 02-11, the accompanying consolidated financial statements included all the accounts of the Company and its wholly-owned subsidiaries, Coil Tubing Technology, Inc., a Texas corporation ("CTT"), and Precision Machining Resources, Inc., a Texas corporation, and Coil Tubing, our parent company.

The accompanying unaudited financial statements of Coil Tubing Technology Holdings, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's filing with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year December 31, 2008 as reported in Form 10-K, have been omitted.

NOTE 2 - GOING CONCERN

The accompanying financial statements have been prepared on a going concern basis which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As of March 31, 2009 and December 31, 2008 respectively, the Company had accumulated deficits of $2,289,770 and $2,193,661 and, for the three months then ended March 31, 2009, had net loss of $96,109. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

While the Company is attempting to increase revenues, the Company’s cash position may not be sufficient enough to support its daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to increase revenues and in its ability to raise additional funds, there can be no assurances to that effect. The Company is dependent upon its ability to achieve profitable operations or obtain adequate financing. The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.

NOTE 3– STOCKHOLDERS’ EQUITY

COMMON STOCK

As of March 31, 2009 and December 31, 2008, the Company had 22,050,000 and 21,000,000 shares respectively of its $.001 par value common stock issued and outstanding.

In January 2009, the Company issued 1,050,000 shares of common stock in connection with a compensation agreement with our chief executive officer valued at $24,000. The expense was recorded at December 31, 2008. The Company valued the preferred shares at their fair value on the date of issuance of such shares.

F-4

NOTE 4- REVERSE SPIN-OFF & DISCONTINUED OPERATIONS

The Company is a majority owned subsidiary of Coil Tubing which is a non-reporting company. Coil Tubing agreed to distribute to its shareholders of record, on a date which has not yet been established, 100% of the common shares of the Company that it owns, totaling 20,000,000 million shares or 91% of the outstanding shares of the Company. Subsequent to the spin-off, Coil Tubing will no longer have an ownership interest in the Company. Notwithstanding the legal form of the distribution, the distribution has been accounted for as a reverse spin off in accordance with Emerging Issues Task Force Issue No. 02-11, “Accounting for Reverse Spin-offs.” Accordingly, the Company is considered the divesting entity and treated as the “accounting successor” to Coil Tubing for financial reporting purposes. This is required based on the business transferred generated all of Coil Tubing’s revenue and constituted a majority of its book value and accordingly, Coil Tubing is being presented as discontinued operations subsequent to the spin-off.

The Company recorded $23,781 and $23,514 as a loss from discontinued operations for the three months ended March 31, 2009 and 2008, respectively. Other than its ownership interest in the Company (which is not recognized for accounting purposes as explained above) Coil Tubing has no assets and operations as of March 31, 2009 and December 31, 2008. However, Coil Tubing incurred legal expenses which were paid by the Company in 2009 and 2008 and has a liability to the Company as of March 31, 2009 and December 31, 2008. The loss from discontinued operations for the months ended March 31, 2009 and 2008 was due to professional fees.

The interim financial information of the Parent as of March 31, 2009 was as follows:

F-5

PARENT COMPANY FINANCIAL STATEMENTS (UNCONSOLIDATED)

	March 31, 2009
Balance Sheet:

Total assets	$	-

Advances by Coil Tubing Technology Holdings, Inc.		267,871
Total liabilities		267,871

Preferred Series A stock Preferred Series B stock		1,000 1,000
Common stock		149,655
Additional paid-in capital		1,186,746
Accumulated deficit		(1,606,272	)
Total stockholders’ equity		(267,871	)

Total liabilities and stockholders’ equity	$	-

Statements of Operations :		Three months ended March 31, 2009				Three months ended March 31, 2008

Operating expenses:
Legal & Accounting Expenses	$	$23,781			$	$ 23,514
Total operating expenses
			23,781				23,514

Net Loss
	$		(23,781	)	$		(23,514	)

NOTE 5– COMMITMENTS

In July 2007, the Company retained Jerry Swinford as its President and Chief Executive Officer pursuant to an employment agreement which was subsequently amended in September 2007 ("Employment Agreement"). In connection with entering into the Employment Agreement, the Company also entered into a Licensing Agreement (also subsequently amended in September 2007) and a Waiver of Royalties Agreement with Mr. Swinford. The Employment Agreement provides for Mr. Swinford to receive a salary of $132,000 for 2009 with yearly increases, assuming such agreement is extended past the initial term, of a minimum of 10% of the prior year’s salary, for each additional year he is employed under the agreement. The Employment Agreement also provides that Mr. Swinford retains all rights to any inventions he may discover, originate or invent.

Under the Licensing Agreement, Mr. Swinford is entitled to a royalty of 10% of gross revenue from each invention licensed, with a minimum royalty of $100,000 per year. The royalty increases to 20% of gross revenue, with a minimum royalty of $200,000 per year, from each invention licensed for which Letters Patent are issued.

Under the Waiver of Royalties Agreement, Mr. Swinford agreed to waive any royalties due to him as long as he was employed by the Company and on the Board of Directors. If Mr. Swinford's employment by the Company ceased or if he were removed from the Board of Directors, the Waiver of Royalties Agreement would terminate and the Company would be obligated to pay the royalties due under the Licensing Agreement. Further, if the company fails to meet the minimum royalties requirements, Mr. Swinford may elect to terminate the Licensing Agreement or, alternatively, convert the license to a non-exclusive license with sixty (60) day written notice to the Company.

F-6

Pursuant to the Employment Agreement, Mr. Swinford received 1,000,000 shares of our common stock upon the execution of the Agreement. At the expiration of the initial term, December 31, 2008, and each extension year he is employed under the Employment Agreement, the Company is to issue him additional shares of common stock equal to 5% of the Company's then shares of outstanding common stock. As a result, because Mr. Swinford was employed as of December 31, 2008 under the Employment Agreement and the Company had 21,000,000 shares of common stock outstanding, Mr. Swinford received 1,050,000 shares of common stock in January 2009 pursuant to the Employment Agreement. The Company recorded stock based compensation expense in the amount of $24,000 for the year ended December 31, 2008 in connection with the Employment Agreement and issued the common shares in January 2009.

For the three months ended March 31, 2009 and March 31, 2008, the Company incurred rental expenses of approximately $7,650 and $10,980, respectively. The Company accounts for rent expense over the related lease term on a straight-line method. The current leases are on a month-to-month basis.

NOTE 6 – SUBSEQUENT EVENTS

Effective June 1, 2009, Mr. Tynon entered into an Executive Compensation and Retention Agreement with us to serve as our Chief Executive Officer and President (the “Tynon Employment Agreement”). The initial term of the Tynon Employment Agreement is until December 31, 2011 (the “Initial Term”). Furthermore, the Tynon Employment Agreement is automatically renewed on January 1, 2010 and each successive year (each an “Extension Year”), unless Mr. Tynon provides the Company in writing that he will not be exercising the extension by December 1 of each year prior to the relevant January 1.

The Tynon Employment Agreement provides for Mr. Tynon to receive a salary of $132,000 for the first year of the Tynon Employment Agreement (pro rated for the remainder of the year), with yearly increases, of a minimum of 10% of the prior year’s salary. Additionally, pursuant to the Tynon Employment Agreement, Mr. Tynon received 750,000 shares of our common stock upon the execution of the Tynon Employment Agreement, and at the expiration of the Initial Term and each Extension Year he is employed under the Tynon Employment Agreement, we agreed to issue him additional shares of common stock equal to 5% of our then shares of outstanding common stock (excluding any shares of common stock issuable to other executives of the Company as a result of incentive share clauses of such executive’s employment agreements).

On or around June 1, 2009, Coil Tubing entered into a Line of Credit Promissory Note (the “Line of Credit”) with Charles Wayne Tynon, the Chief Executive Officer and President of the Company, effective June 1, 2009. Pursuant to the Line of Credit, Mr. Tynon agreed to loan Coil Tubing up to $250,000. Any amounts borrowed under the Line of Credit bear interest at the rate of 6% per annum, payable at maturity, which maturity date is June 1, 2011. The Line of Credit is secured by a Security Agreement entered into between Coil Tubing and Mr. Tynon (the “Security Agreement”). At any time after June 1, 2010, Mr. Tynon can convert the then outstanding amount of the Line of Credit into shares of Coil Tubing’s common stock at a conversion price of $0.0033333 per share. The Security Agreement provides Mr. Tynon a first priority security interest in all of Coil Tubing’s current or future, machinery and equipment, inventory and proceeds or products derived therefrom, and rights under contracts, causes of action, documents, and evidence of title to inventory and contract rights. As of the date of this filing a total of $60,000 has been borrowed under the Line of Credit.

F-7

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

CERTAIN STATEMENTS IN THIS QUARTER REPORT ON FORM 10-Q (THIS "FORM 10-Q"), INCLUDING STATEMENTS UNDER "BUSINESS", AND " MANAGEMENT'S DISCUSSION AND ANALYSIS", CONSTITUTE "FORWARD LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1934, AS AMENDED, AND THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 (COLLECTIVELY, THE "REFORM ACT"). CERTAIN, BUT NOT NECESSARILY ALL, OF SUCH FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY SUCH AS "BELIEVES", "EXPECTS", "MAY", "SHOULD", OR "ANTICIPATES", OR THE NEGATIVE THEREOF OR OTHER VARIATIONS THEREON OR COMPARABLE TERMINOLOGY, OR BY DISCUSSIONS OF STRATEGY THAT INVOLVE RISKS AND UNCERTAINTIES. SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF COIL TUBING TECHNOLOGY HOLDINGS, INC. AND ITS TWO WHOLLY-OWNED TEXAS SUBSIDIARIES, PRECISION MACHINING RESOURCES, INC. (“PMR”) AND COIL TUBING TECHNOLOGY, INC. (“CTT TEXAS”)(COLLECTIVELY "HOLDINGS", THE "COMPANY", "WE", "US" OR "OUR") TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. REFERENCES IN THIS FORM 10-Q, UNLESS ANOTHER DATE IS STATED, ARE TO MARCH 31, 2009.

Coil Tubing Technology Holdings, Inc. was formed as a Texas corporation on July 2, 1999. On March 20, 2005, our then sole shareholder, Jerry Swinford, our former Chief Executive Officer and current Executive Vice President (see Item 5. Other Information, below) and current sole Director, entered into a Definitive Acquisition Purchase Agreement (the “Purchase Agreement”) with Grifco International, Inc. [GFCI.PK] (“Grifco”), pursuant to which he sold 100% of our outstanding common stock, 51,000 pre Forward Split (defined below) shares of common stock (20,000,000 shares post Forward Split) to Grifco for an aggregate price of $510,000, payable as $50,000 in cash and $460,000 worth of Grifco common stock (totaling 1,482,871shares of common stock, based on the trading price of Grifco’s common stock on the Pink Sheets trading market on the day of closing of the Purchase Agreement), of which $200,000 in stock (645,161 shares) was paid to settle an $800,000 debt owed by us to a third party, HyCoTec Investments, B.V., a Netherlands limited liability company (“HyCoTec”), and $260,000 in stock (837,710 shares) was paid directly to Mr. Swinford. The 837,710 shares of Grifco common stock which Mr. Swinford received represented less than 5% of Grifco’s common stock, and as such, Mr. Swinford did not have any control over the operations of Grifco prior to or following the parties entry into the March 2005 Purchase Agreement. Furthermore, Mr. Swinford has not ever served as an officer or Director of Grifco. Grifco held our common shares in its own name and as such, we were a wholly-owned subsidiary of Grifco following the Purchase Agreement.

Shortly after the acquisition of the Company, Grifco determined it would be in the best interests of its shareholders if the coil tubing portion of the business was a standalone entity, which would once again focus solely on proprietary tools and equipment. In an effort to create such a stand alone entity, Grifco acquired approximately 89% of IPMC Holdings Corp. in November 2005, as described below, in exchange for the Company and the Company’s proprietary coil tubing business therein.

THE SPIN-OFF

The Company previously registered twenty million (20,000,000) shares of its common stock with the Securities and Exchange Commission, pursuant to a Form S-1 Registration Statement declared effective on February 17, 2009, to be distributed by Coil Tubing Technology, Inc., our parent corporation (“Coil Tubing”) to its shareholders (the “Distribution”) as of February 13, 2009 (the “Record Date”). This equates to one share of our common stock distributed for each approximately 7.483 shares of common stock held by each shareholder of Coil Tubing as of the Record Date. Fractional shares will be rounded up to the nearest whole share. Following the Distribution, we will be a stand alone company. We also plan to take steps to quote our securities on the Over-The-Counter Bulletin Board subsequent to the Distribution, as we believe that this will improve our access to the capital markets for additional growth capital. However, an active market for our securities may not develop following the Distribution, if ever. We are currently in the process of determining the state blue-sky exemptions for the shares to be distributed pursuant to the Distribution, and plan to distribute the twenty million (20,000,000) shares of our common stock to the shareholders of Coil Tubing as of the Record Date promptly after we have completed such blue sky analysis and made the required filings with the various state securities divisions.

-2-

We plan to either register the Distribution in each state and/or rely on exemptions from registration in the states where the shares are distributed and such shares may only be traded in such jurisdictions after compliance with applicable securities laws. The shares may not be eligible for sale or resale in such jurisdictions. We may apply to register the shares in several states for secondary trading; however we are under no requirement to do so. Rather, we retain the option and anticipate that we will pay the dividend in cash in lieu of shares, at a price of $0.01 per share to holders of Coil Tubing common stock that reside in some states which do not provide for an exemption from state registration for the Distribution.

We will not receive any proceeds from the spin-off of the shares of common stock.

Transactions Involving Our Parent, Coil Tubing Technology, Inc.

Our parent company, Coil Tubing, was formed as a result of a series of transactions in November and December 2005, that resulted in a reserve merger, change in domicile and name change.

In November 2005, IPMC Holdings Corp., a Florida corporation, we and Grifco entered into an Agreement For Exchange of Common Stock (the “Exchange Agreement”), whereby IPMC Holdings Corp. (which is the predecessor to our parent corporation, Coil Tubing) agreed to exchange 75,000,000 newly issued shares of its common stock (representing approximately 89% of IPMC Holdings Corp.’s then outstanding stock, based on 14,200,794 shares of IPMC Holdings Corp.’s outstanding common stock prior to the exchange) to Grifco for the 51,000 pre Forward Split shares of common stock (20,000,000 shares post Forward Split), representing 100% of our outstanding shares, which Grifco held subsequent to the Purchase Agreement (described above). As a result of the Exchange Agreement, we became a wholly-owned subsidiary of IPMC Holdings Corp. and IPMC Holdings Corp. became a majority owned subsidiary of Grifco (which held 75,000,000 shares of IPMC Holdings Corp. as a result of the Exchange Agreement). We had no role in the Exchange Agreement, other than in certifying certain disclosures made about the Company in the Exchange Agreement, and being the entity exchanged from Grifco to IPMC Holdings Corp. IPMC Holdings Corp. had approximately 310 shareholders of record prior to the Exchange Agreement.

The acquisition by Grifco of IPMC Holdings Corp. was handled entirely by Grifco’s management and presumably, its counsel. Neither the current management of Coil Tubing nor the Company were involved in negotiating, drafting or finalizing the transaction or the terms of the transaction, nor was their input on the transaction sought. Grifco was the ultimate purchaser of IPMC Holdings Corp., controlled the management of, and the officers and Directors of IPMC Holdings Corp. Later, after the management of Coil Tubing was taken over by Jerry Swinford, Coil Tubing’s current Chief Executive Officer and sole Director and the Company’s former Chief Executive Officer and current Executive Vice President (see Item 5. Other Information, below) and current sole Director, it became clear that there were numerous issues with the Grifco/IPMC Holdings Corp. merger, including the fact that IPMC Holdings Corp. was a deficient filer with the Commission, that IPMC Holdings Corp. may have had liabilities which were unknown to Grifco at the time of the transaction, and that IPMC Holdings Corp.’s financial statements were at that time un-auditable. As a result, Coil Tubing and the Company obtained separate counsel to assist them with the issues created by the transaction. Mr. Swinford has no control and has never had any control over Grifco, and has historically only had limited contact with Grifco.

Coil Tubing is the result of Grifco’s acquisition of IPMC Holdings Corp. and related “reverse merger.” Coil Tubing’s current management, Jerry Swinford, was not involved in negotiating or effecting the transaction. Thus, he was not aware of Coil Tubing’s reporting obligations pursuant to the Securities Act of 1934, as amended, until sometime well after the 2005 merger. As a result, Mr. Swinford did not consider Coil Tubing a reporting company until such time as he became aware of its reporting obligations.

-3-

Coil Tubing Technologies, Inc. was formed in Nevada on November 30, 2005. On December 8, 2005, IPMC Holdings Corp. entered into a Plan and Agreement of Merger and Reorganization (the “Merger”) with Coil Tubing Technologies, Inc., pursuant to which each outstanding share of IPMC Holdings Corp. was exchanged for one share of Coil Tubing Technologies, Inc. As a result of the Merger, Coil Tubing Technology, Inc., our parent company (Coil Tubing) became the sole surviving corporate entity of the merger between IPMC Holdings Corp. and Coil Tubing Technologies, Inc. (taking the name “Coil Tubing Technology, Inc.” in connection with the Merger), and we became a wholly-owned subsidiary of Coil Tubing. Coil Tubing Technologies, Inc. had no business or operations prior to the Merger with IPMC Holdings Corp. Coil Tubing Technologies, Inc. had only 100 outstanding shares at the time of its formation and prior to the Merger with IPMC Holdings Corp., which shares were held by Grifco’s President, James Dial.

Summary of Material Corporate Events and Agreements Regarding the Company

In May 2007, our majority shareholder, Coil Tubing, determined it was in our best interest to re-domicile from the State of Texas to the State of Nevada, and on May 24, 2007, we entered into a Plan of Conversion and filed Articles of Conversion with the Secretary of State of Texas and Nevada, shortly thereafter, to affect a conversion to a Nevada corporation (the “Conversion”). Concurrently with the Conversion, we increased our authorized shares of common stock to 500,000,000 shares, $0.001 par value per share, and authorized 10,000,000 shares of blank check preferred stock, $0.001 par value per share.

In May 2007, we entered into an 1) Agreement and Release and 2) a Novation of Agreement For Exchange of Common Stock (collectively the “Release and Restatement”) with Coil Tubing, Grifco, our former Chief Executive Officer and current Executive Vice President (see Item 5. Other Information, below) and current sole Director and James Dial, the then Chief Executive Officer of Grifco. Pursuant to the Release and Restatement, the parties agreed that Grifco would distribute the 75,000,000 shares of Coil Tubing which it held (which shares were received in connection with the Exchange Agreement, described above) to its shareholders as of a previously determined record date, and Coil Tubing would issue Grifco 1,000,000 shares of Series B Preferred Stock, which will have no voting rights and will not participate in the Distribution, but will be convertible into 20,000,000 shares of Coil Tubing common stock, if Grifco exercises its option to purchase the Series A Preferred Stock of Coil Tubing. Our former Chief Executive Officer and current Executive Vice President (see Item 5. Other Information, below) and current sole Director, Jerry Swinford, who is also the Chief Executive Officer of Coil Tubing, currently holds 1,000,000 shares of Series A Preferred Stock of Coil Tubing, which Series A Preferred Stock gives him the right to vote 51% of all of the outstanding voting shares on any shareholder votes. The “Option Period” which allows Grifco the right to purchase the Series A Preferred Stock of Coil Tubing for aggregate consideration of $100 lasts two (2) years from the date Mr. Swinford no longer desires to hold the Series A Preferred Stock of Coil Tubing. It is not known when Mr. Swinford will no longer desire to hold the Series A Preferred Stock of Coil Tubing, but the Company anticipates that it will be some time after we have conducted our Distribution. The Release and Restatement agreements also provided that Jerry Swinford cancel 75,000,000 shares of Coil Tubing which he held, which shares were cancelled in 2007. Neither Coil Tubing's Series A Preferred Stock nor Series B Preferred stock will participate in the Distribution, and because Mr. Swinford is not going to allow the purchase of the Series A Preferred Stock of Coil Tubing by Grifco until after the successful completion of the Distribution, such Series B Preferred Stock will not be able to be converted into shares of Coil Tubing common stock and will therefore not be eligible for the Distribution. Grifco does not currently hold any shares of our common stock or any shares of common stock of Coil Tubing and will not hold any shares of our common stock following the Distribution.

The Release and Restatement also provided that Grifco on behalf of itself, its shareholders, directors, officers, attorneys, agents, employees, heirs, predecessors, successors, affiliates, and assigns, and Mr. Dial released, acquitted and forever discharged us, Coil Tubing and Mr. Swinford along with their shareholders, directors, officers, attorneys, agents, employees, heirs, predecessors, successors, affiliates, from any and all claims, demands and causes of action of any nature whatsoever, whether arising under any contract or in tort, or arising under any state or regulation or under common law, which were or which could have been asserted in, or which arise from or in any way relate to the various activities by the parties, or which arise from or relate to any of the events giving rise thereto, and including all damage and other events arising therefrom. However, neither we nor Coil Tubing released Grifco from any claims or causes of action.

-4-

The Release and Restatement also included a provision whereby the parties agreed that Mr. Swinford would enter into an Employment Agreement with us, whereby he will serve as our Chief Executive Officer for a period of time to be determined by our Board of Directors (as described below), and that he would be issued shares of our Preferred Stock enabling him to vote 51% of our outstanding common stock. The Company issued such shares of our Preferred Stock as described in greater detail below under “Description of Capital Stock.” Additionally, pursuant to the Release and Restatement, Grifco agreed to cancel an Assignment of Patent made by Jerry Swinford in April 2005 in connection with the Purchase Agreement. Effective June 1, 2009, as described below under Item 5. Other Information, Mr. Swinford resigned as our Chief Executive Officer, Chief Financial Officer and President and was appointed Executive Vice President.

Pursuant to the Release and Restatement, the parties also agreed to amend certain inconsistent terms of the Exchange Agreement, and that Grifco and Mr. Dial agreed to release and discharge Coil Tubing, us and Mr. Swinford from any and all liability, claims or demands whatsoever in connection with the Exchange Agreement.

The Agreement and Release was entered into to clarify various agreements, discussions and understandings between the parties to the Agreement and Release. Additionally, Grifco had made certain capital contributions to the Company, and the Company desired to have Grifco release the Company from any and all claims associated with such contributions and/or any other claims that Grifco may have had against the Company.

On June 19, 2007, our Board of Directors, and majority shareholder, Coil Tubing, approved a 392.1568627 for one forward stock split of our issued and outstanding common stock, for all shareholders of record as of June 19, 2007 (the “Forward Split”). As a result, our issued and outstanding shares increased from 51,000 prior to the forward stock split to 20,000,000 shares subsequent to the forward stock split.

The effects of the Conversion and Forward Split have been reflected throughout this report.

On or about June 19, 2007, our Board of Directors approved the designation of 1,000,000 shares of our Series A Preferred Stock. The Series A Preferred Stock is described in greater detail below under “Description of Capital Stock.”

Further, on June 19, 2007, pursuant to the designation, subsequent to the Forward Split, we issued 1,000,000 shares of Series A Preferred Stock in Coil Tubing Technology Holdings, Inc. to Jerry Swinford, our sole Director. Unless otherwise stated or the context would suggest otherwise, all references to the Series A Preferred Stock contained in this report refer to the Series A Preferred Stock of the Company, and not of Coil Tubing.

BUSINESS OPERATIONS

We specialize in the design and production of proprietary tools for the coil tubing industry. We concentrate on four categories of coil tubing applications: tubing fishing, tubing work over, pipeline clean out, and coil tubing drilling, which categories of applications are described in greater detail below. We currently outsource 95% of our tools and components to be manufactured by outside manufacturers and purchase the remaining 5% of our products off the shelf.

-5-

The Market for Coiled Tubing

We believe that the United States domestic market and Canada, which we operate in, is by far the largest and the most competitive market for coil tubing technology, due to the older age of wells and the difficulty in keeping them profitable. Moreover, the United States has historically been considered to be the breeding ground for new technology; however with the recent general economic downturn, the day rates for coil tubing have prohibited oil companies from using coil tubing in the U.S. As a result, we are attempting to enter the Southeast Asian and Middle Eastern markets where coil tubing unit pricing appears to be more stable.

Business Strategy

We have based our business strategy on the leasing and rental of our product lines to three distinct markets:

	·	Oil Companies;
	·	Coiled Tubing Operators; and
	·	Well Servicing Companies.

There are four components to our strategic vision:

	·	Build profitable year over year sales of existing proprietary products;
	·	Accelerate development of new proprietary products;
	·	Accelerate growth of new distribution stockpoints worldwide; and
	·	Accelerate growth through acquisitions.

We believe increasing our proprietary product lines availability to our customers is critical to our profitability. Therefore, we will focus on initiatives to drive year over year sales growth for our existing products, funding permitting, emphasizing:

	·	Enhanced customer focus through a concerted sales and marketing effort in the future;
	·	Increased investment in product lines; and
	·	Accelerated growth of new product lines.

Hammelmann Distributor Contracts

On or about January 1, 2007, Coil Tubing Technology, Inc., our wholly-owned Texas subsidiary (“CTT Texas”) entered into two Statement of Understandings with Hammelmann Corp. (“Hammelmann” and the “Statement of Understandings”). The Statement of Understandings provide for Hammelmann to provide CTT Texas the coil tubing nozzles known as the “RotorJet” and “TurboJet” and the surface cleaner known as the “Coil Tubing Cleaner” to market, field test and to report the performance of to Hammelmann, with any revenues generated on such products to be split 50/50 between CTT Texas and Hammelmann. The Statements of Understandings remain in effect until terminated with sixty (60) days prior written notice to the non-terminating party.

Subsidiaries

We currently have two wholly-owned Texas subsidiaries, Precision Machining Resources, Inc. (“PMR”) and Coil Tubing Technology, Inc., a Texas corporation (“CTT Texas”). The majority of our tool rental operations are run through CTT Texas. PMR owns certain manufacturing equipment formerly used to produce tools used in the work-over segment of the Company’s rental business, which generally require smaller tools than other coil tubing operations. PMR also stocks coil tubing tool parts which it sells directly to other service companies, making PMR a supply and sales arm for non-proprietary tools and equipment of the Company.

-6-

PLAN OF OPERATIONS FOR THE NEXT TWELVE MONTHS

We believe that we will be able to continue our business operations for approximately the next forty-five days; however, due to the recent decline in the demand for our products, we will be largely operating out of our current receivables on hand. In order to support our planned expansion of our operations over the next approximately twelve (12) months, we anticipate needing approximately $2,000,000 in additional funding.

We are currently working on a new generation of coil tubing tools to aid in and facilitate well drilling. We expect the market for new applications of coiled tubing to continue to be curtailed somewhat in the U.S. markets with Southeast Asia and Middle Eastern markets remaining active through fiscal 2009, especially in drilling and workover applications. We are actively pursuing international markets, potentially with the alliance of a yet to be determined major service company.

Moving forward, we anticipate spending a larger percentage of our working capital on research and development activities, which we believe will be required to provide technological advancement to our coiled tubing technologies.

-7-

COMPARISON OF OPERATING RESULTS

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2009, COMPARED TO THE THREE MONTHS ENDED MARCH 31, 2008

We had total revenue, consisting of product sales and rental income of $134,994 for the three months ended March 31, 2009, compared to total revenue, consisting of product sales and rental income of $582,662 for the three months ended March 31, 2008, a decrease in total revenue of $447,668 or 76.8% from the prior period.

We had total product sales of $23,428 for the three months ended March 31, 2009, a decrease of $388,665 or 94.3% from total product sales of $412,093 for the three months ended March 31, 2008. The decrease in product sales was mainly due to a large sale of tools made in the first quarter of 2008 that was not present in the first quarter of 2009.

We had total rental income of $111,566 for the three months ended March 31, 2009, a decrease in total rental income of $59,003 or 34.6% from total rental income of $170,569 for the three months ended March 31, 2008. The decrease in rental income was mainly due to reduced rental tool activity by our customers in connection with the downturn in the oil and gas market, specifically a decrease in drilling during the three months ended March 31, 2009.

We had cost of sales of products and rental income of $18,521 for the three months ended March 31, 2009, compared to cost of sales of products and rental income of $152,863 for the three months ended March 31, 2008, a decrease of $134,342 or 87.9% from the prior period, which decrease was primarily the result of decreased sales of tools and tool rentals during the three month period ended March 31, 2009, compared to the three month period ended March 31, 2008, and the resulting decreased costs associated with such decreased sales.

We had cost of sales - depreciation of $38,689 for the three months ended March 31, 2009, compared to cost of sales - depreciation of $31,783 for the three months ended March 31, 2008, an increase of $6,906 or 21.7% from the prior period, which increase was primarily attributable to the increased size of the overall rental tool fleet and reflects the $135,000 in rental tools built in 2008.

We had total cost of sales of $57,210 for the three months ended March 31, 2009, compared to total cost of sales of $184,646 for the three months ended March 31, 2008, a decrease of $127,436 or 69% from the prior period.

Total cost of sales (including depreciation) as a percentage of revenue was 42.4% for the three months ended March 31, 2009, compared to 31.7% for the three months ended March 31, 2008, an increase in total cost of sales as a percentage of revenue of 10.7% from the prior period.

We had gross profit of $77,784 for the three months ended March 31, 2009, compared to gross profit of $398,016 for the three months ended March 31, 2008, a decrease of $320,232 or 80.5% from the prior period.

We had general and administrative expenses of $142,844 for the three months ended March 31, 2009, compared to general and administrative expenses of $238,153 for the three months ended March 31, 2008, a decrease of $95,309 or 40.0% from the prior period. The main reasons for the decrease in general and administrative expenses were that legal and auditor fees and consulting and contract labor fees were lower for the three months ended March 31, 2009, as compared to the three months ended March 31, 2008. Additionally, general and administrative expenses were lower during the three months ended March 31, 2009, compared to the three months ended March 31, 2008, because 2008 included employee salaries and rent related to our McAllen, Texas location which was closed in the first half of 2008.

-8-

We had depreciation and amortization expense of $5,326 for the three months ended March 31, 2009, compared to depreciation and amortization expense of $3,846 for the three months ended March 31, 2008, an increase of $1,480 or 38.5% from the prior period.

We had total operating expenses of $148,170 for the three months ended March 31, 2009, compared to total operating expenses of $241,999 for the three months ended March 31, 2008, a decrease of $93,829 or 39% from the prior period.

We had a loss from continuing operations of $70,386 for the three months ended March 31, 2009, compared to a gain from continuing operations of $156,017 for the three months ended March 31, 2008, an increase in loss from continuing operations of $226,403 or 145% from the prior period, which increase was mainly due to the 77% decrease in revenues offset by the 69% decrease in cost of sales and the 39% decrease in total operating expenses for the three months ended March 31, 2009, compared to the three months ended March 31, 2008.

We had a loss on sale of assets of $1,942 for the three months ended March 31, 2009, compared to no loss on sale of assets for the three months ended March 31, 2008.

We had a loss from discontinued operations of $23,781 for the three months ended March 31, 2009, compared to a loss from discontinued operations of $23,514 for the three months ended March 31, 2008, an increase of $267 from the prior period. The loss from discontinued operations in 2008 was the result of significant legal, accounting and valuation expenses which were paid for by the Company on behalf of Coil Tubing. The loss from discontinued operations in 2007 was the result of stock compensation.

We had a net loss of $96,109 for the three months ended March 31, 2009, compared to net income of $132,503 for the three months ended March 31, 2008, an increase in net loss of $228,612 or 172% from the prior period.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 2009, we had total assets of $478,483, which included total current assets of $68,361, consisting of $24,388 of cash and $43,973 of accounts receivable, net; $356,175 of rental tools, net; $48,097 of machinery and equipment, net; and $5,850 of other assets.

We had total liabilities of $31,091 as of March 31, 2009, which were all current liabilities, and which solely consisted of $31,091 of accounts payable and accrued liabilities.

We had total working capital of $37,270 and an accumulated deficit of $2,289,770 as of March 31, 2009.

We had net cash used in operating activities of $25,625 for the three months ended March 31, 2009, which consisted of $96,109 of net loss, $111,411 of decrease in accounts payable and accrued expenses, and $1,871 of decrease in other assets, offset by $44,015 of depreciation, $1,942 of gain on sale of asset, and $137,809 of decrease in accounts receivable.

We had $10,896 of net cash used in investing activities for the three months ended March 31, 2009, which was due to $24,296 of purchase of machinery and equipment and $13,400 of proceeds from sale of machinery and equipment.

On or around June 1, 2009, Coil Tubing entered into a Line of Credit Promissory Note (the “Line of Credit”) with Charles Wayne Tynon, the Chief Executive Officer and President of the Company, effective June 1, 2009 (as described in greater detail below under Item 5. Other Information). Pursuant to the Line of Credit, Mr. Tynon agreed to loan Coil Tubing up to $250,000. Any amounts borrowed under the Line of Credit bear interest at the rate of 6% per annum, payable at maturity, which maturity date is June 1, 2011. The Line of Credit is secured by a Security Agreement entered into between Coil Tubing and Mr. Tynon (the “Security Agreement”). At any time after June 1, 2010, Mr. Tynon can convert the then outstanding amount of the Line of Credit into shares of Coil Tubing’s common stock at a conversion price of $0.0033333 per share. The Security Agreement provides Mr. Tynon a first priority security interest in all of Coil Tubing’s current or future, machinery and equipment, inventory and proceeds or products derived therefrom, and rights under contracts, causes of action, documents, and evidence of title to inventory and contract rights. As of the date of this filing a total of $60,000 has been borrowed under the Line of Credit.

-9-

We have noticed a sharp decline in the market and demand for our products and services due to the current global economic downturn and continuing recession. As the demand for new oil and gas has declined and customers have decreased their budget for services such as ours, we have seen the demand for our coil tubing products and our revenues decrease substantially in fiscal 2009. As a result, we are attempting to enter the Southeast Asian and Middle Eastern markets where coil tubing unit pricing appears to be more stable.

Additionally, with the tightening of our market, we recently entered into a longer term lease arrangements with two clients, and are having similar discussions with other customers. Under these longer term arrangements, we receive a monthly lease payment for tools placed with such customers. The result is a more stable stream of revenue for the Company and more stable expenses for our customer; however, the lease arrangement also reduces the per day utilization rate of revenue received by the Company, and as such, may have a material adverse effect on our revenues.

We have no current commitment from our officers and Director (other than the Line of Credit) or any of our shareholders, to supplement our operations or provide us with financing in the future. If we are unable to raise additional capital from conventional sources and/or additional sales of stock in the future, we may be forced to curtail or cease our operations. Even if we are able to continue our operations, the failure to obtain financing could have a substantial adverse effect on our business and financial results. In the future, we may be required to seek additional capital by selling debt or equity securities, selling assets, or otherwise be required to bring cash flows in balance when we approach a condition of cash insufficiency. The sale of additional equity or debt securities, if accomplished, may result in dilution to our then shareholders. We provide no assurance that financing will be available in amounts or on terms acceptable to us, or at all.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Pursuant to Item 305(e) of Regulation S-K (§ 229.305(e)), the Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined by Rule 229.10(f)(1).

ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures. Our Chief Executive Officer and Principal Accounting Officer, after evaluating the effectiveness of our "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Quarterly Report on Form 10-Q (the "Evaluation Date"), has concluded that as of the Evaluation Date, our disclosure controls and procedures were effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Principal Accounting Officer, as appropriate, to allow timely decisions regarding required disclosure.

(b) Changes in internal control over financial reporting. There were no changes in our internal control over financial reporting during our most recent fiscal quarter that materially affected, or were reasonably likely to materially affect, our internal control over financial reporting.

-10-

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

DTCC/DTC, Grifco & Dial Litigation

On or around July 30, 2008, the Company, Coil Tubing and our former Chief Executive Officer and current Executive Vice President (see Item 5. Other Information, below) and current sole Director, Jerry Swinford ("Plaintiffs"), filed a lawsuit against Grifco, Depository Trust & Clearing Corporation ("DTCC/DTC") and the president of Grifco, James Dial (the "Defendants"). The case is pending as Cause No. 08-07-07397-CV in the Montgomery County, Texas, District Court, 9th Judicial District. The suit stems from Grifco's distribution of its 75,000,000 shares of Coil Tubing in August 2007 ("Grifco Distribution"). Additionally, without informing Coil Tubing or providing any consideration to Coil Tubing, the DTCC/DTC made “book entries” for its participating members thereby unilaterally creating additional shares of Coil Tubing stock.

In August 2007, Grifco attempted to distribute 75,000,000 shares of Coil Tubing common stock which it held to its shareholders based on a record date of May 1, 2006. Certain Grifco shareholders who held Grifco shares on the record date were not issued shares of Coil Tubing in connection with the Grifco Distribution. Generally only Grifco shareholders who held their shares in street name on the record date were distributed shares in the Grifco Distribution. Thus, shareholders who held their shares in certificate form did not receive shares in the Grifco Distribution. Mr. Swinford was one such record shareholder of Grifco, who did not receive shares in the Grifco Distribution.

Grifco did not hold a sufficient number of shares to distribute to its shareholders who held their shares in street name at the distribution ratio announced by Grifco. Grifco announced that each of its shareholders would receive 1.89 shares of CTBG stock for each share of Grifco stock held as of the record date. In late April 2008, the DTCC/DTC informed Coil Tubing (for the first time) that Grifco did not transfer to DTCC/DTC's agent, Cede & Co., a sufficient number of shares to affect the distribution at the ratio announced. The 1.89 ratio announced by Grifco implied that Grifco had approximately 40,000,000 shares outstanding as of the record date. DTCC/DTC contends, however, that Grifco had approximately 68,000,000 shares outstanding in street name as of the record date, May 1, 2006.

Between the time Grifco distributed its shares (August 2007) until the DTCC/DTC contacted Coil Tubing (late April 2008), the DTCC/DTC contends it made various demands on Grifco for additional shares. Grifco provided the DTCC/DTC with waivers from certain shareholders, but such waivers were not sufficient to address the deficiency in its entirety.

Coil Tubing was contacted by the DTCC/DTC regarding the shortfall in shares in April 2008. Coil Tubing immediately took steps to have Grifco contact shareholders who did not receive shares in the distribution and obtain signed waivers of their right to receive shares in the stock dividend. To date, a limited number of such waivers have been obtained. Because of Grifco's failure to obtain waivers from a sufficient number of shareholders, DTCC/DTC demanded that Coil Tubing acquire additional free trading shares in the market or issue additional free trading shares to satisfy the shortfall. Coil Tubing did not purchase the additional shares demanded by DTCC/DTC and Coil Tubing does not have a registration statement on file allowing it to issue additional free trading shares. Additionally, issuing additional shares of Coil Tubing would substantially dilute the interests of Coil Tubing’s existing shareholders.

On July 10, 2008, DTCC/DTC issued a Stock Dividend E-Mail Alert to its participating members. The Alert stated that DTCC/DTC had not received sufficient shares from Grifco in order to affect the stock dividend at the ratio Grifco announced. DTCC/DTC further stated that unless it received the necessary shares by July 31, 2008, it would unilaterally adjust the ratio of shares received in the stock dividend from the rate originally declared, 1.89 shares of Coil Tubing common stock for each share of Grifco common stock which shareholders of Grifco held, to a reduced rate of approximately 1.29 shares of Coil Tubing for each share of Grifco held.

-11-

On July 30, 2008, Coil Tubing filed suit against Defendants. In the suit Coil Tubing sought and obtained a temporary restraining order to restrain the DTCC/DTC from adjusting shareholder accounts and against any Defendant destroying any documentation in connection with the lawsuit. While Coil Tubing was in the process of obtaining the temporary restraining order from the Court, and a day in advance of its announced adjustment date, DTCC/DTC adjusted the ratio of the dividend with most of its participating members. Despite the restraining order, DTCC/DTC's participating members adjusted customers’ accounts on July 31, 2008 and thereafter.

The Plaintiffs believe that all of the Defendants were aware or should have been aware that a shortfall in the Grifco Distribution would occur, but negligently allowed the stock distribution to go forward. Additionally, the Plaintiffs believe that the Defendants engaged in additional acts and omissions which may give rise to other damages. Coil Tubing has and expects to continue to expend funds on the litigation which may negatively impact operations. The Court granted Plaintiffs’ Temporary Injunction and denied DTCC/DTC's Motion to Dismiss. The Court has set the matter for trial on August 31, 2009, and the parties have tentatively agreed to attempt to resolve the matter with the assistance of a mediator. It remains premature to speculate regarding the final outcome of the litigation.

Litigation Generally

From time to time, we may become party to litigation or other legal proceedings that we consider to be a part of the ordinary course of our business. We are not currently involved in legal proceedings that could reasonably be expected to have a material adverse effect on our business, prospects, financial condition or results of operations. We may become involved in material legal proceedings in the future.

ITEM 1A. RISK FACTORS

Our securities are highly speculative and should only be purchased by persons who can afford to lose their entire investment in our Company. If any of the following risks actually occur, our business and financial results could be negatively affected to a significant extent. The Company's business is subject to many risk factors, including the following:

WE MAY REQUIRE ADDITIONAL FINANCING TO IMPLEMENT OUR BUSINESS PLAN AND CONTINUE DEVELOPING AND MARKETING OUR ENVIRONMENTAL COMPLIANCE SYSTEMS.

We have generated only limited revenues since our incorporation in July 1999. We currently believe that we will be able to continue our business operations for approximately the next forty-five days if we fail to raise additional funding; however, due to the decline in the demand for our services, we will be largely operating out of our current receivables on hand. In order to fund our planned expansion of operations over the next approximately twelve (12) months, we anticipate the need for approximately $2,000,000 of additional capital. We may choose to raise additional funds in the future through sales of debt and/or equity securities to support our ongoing operations and for expansion. If we are unable to raise additional financing in the future, we may be forced to abandon or curtail our business plan, which would cause the value of our securities, if any, to decrease in value and/or become worthless.

OUR AUDITORS HAVE RAISED SUBSTANTIAL DOUBT ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN.

Our auditors have raised substantial doubt about our ability to continue as a going concern primarily because we had a net loss of $573,881 and cash used in operations of $438,702, for the year ended December 31, 2008 and a net loss of $96,109 for the three months ended March 31, 2009. The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The financial statements do not include any adjustments that might result from our inability to continue as a going concern. If we are unable to continue as a going concern, our securities will become worthless.

-12-

WE MAY HAVE DIFFICULTY OBTAINING FUTURE FUNDING SOURCES, IF NEEDED, AND WE MAY HAVE TO ACCEPT TERMS THAT WOULD ADVERSELY AFFECT SHAREHOLDERS.

We will need to raise funds from additional financing. We have no commitments for any financing and any financing commitments may result in dilution to our existing stockholders. We may have difficulty obtaining additional funding, and we may have to accept terms that would adversely affect our stockholders. For example, the terms of any future financings may impose restrictions on our right to declare dividends or on the manner in which we conduct our business. Additionally, we may raise funding by issuing convertible notes, which if converted into shares of our common stock would dilute our then shareholders interests. Lending institutions or private investors may impose restrictions on a future decision by us to make capital expenditures, acquisitions or significant asset sales. If we are unable to raise additional funds, we may be forced to curtail or even abandon our business plan.

WE LACK A SIGNIFICANT OPERATING HISTORY FOCUSING ON OUR CURRENT BUSINESS STRATEGY WHICH YOU CAN USE TO EVALUATE US, MAKING SHARE OWNERSHIP IN OUR COMPANY RISKY.

Our Company lacks a long standing operating history focusing on our current business strategy which investors can use to evaluate our Company’s previous earnings. Therefore, ownership in our Company is risky because we have no significant business history and it is hard to predict what the outcome of our business operations will be in the future.

WE HAVE ESTABLISHED PREFERRED STOCK WHICH CAN BE DESIGNATED BY THE COMPANY'S BOARD OF DIRECTORS WITHOUT SHAREHOLDER APPROVAL AND THE BOARD ESTABLISHED SERIES A PREFERRED STOCK, WHICH GIVES THE HOLDERS MAJORITY VOTING POWER OVER THE COMPANY.

The Company has 10,000,000 shares of preferred stock authorized. The shares of preferred stock of the Company may be issued from time to time in one or more series, each of which shall have a distinctive designation or title as shall be determined by the Board of Directors of the Company ("Board of Directors") prior to the issuance of any shares thereof. The preferred stock shall have such voting powers, full or limited, or no voting powers, and such preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof as adopted by the Board of Directors. On June 19, 2007, the Company's Board of Directors approved the issuance of 1,000,000 shares of Series A Preferred Stock to our sole Director, Jerry Swinford. The 1,000,000 shares of Series A Preferred Stock have the right, voting in aggregate, to vote on all shareholder matters equal to fifty-one percent (51%) of the total vote. For example, if there are 22,050,000 shares of the Company's common stock issued and outstanding at the time of a shareholder vote, the holders of Series A Preferred Stock, voting separately as a class, will have the right to vote an aggregate of 22,950,000 shares, out of a total number of 45,000,000 shares voting. Because the Board of Directors is able to designate the powers and preferences of the preferred stock without the vote of a majority of the Company's shareholders, shareholders of the Company will have no control over what designations and preferences the Company's preferred stock will have. The holders of the shares of Series A Preferred Stock will exercise voting control over the Company. As a result of this, the Company's shareholders will have no control over the designations and preferences of the preferred stock and as a result the operations of the Company.

-13-

JERRY SWINFORD, OUR FORMER CHIEF EXECUTIVE OFFICER AND SOLE DIRECTOR OF THE COMPANY CAN VOTE A MAJORITY OF OUR COMMON STOCK AND CAN EXERCISE CONTROL OVER CORPORATE DECISIONS.

Jerry Swinford, our former Chief Executive Officer and current Executive Vice President (see Item 5. Other Information, below) and current sole Director holds 2,050,000 shares of our common stock and 1,000,000 shares of our Series A Preferred Stock, which preferred stock gives him the right to vote in aggregate, 51% of our outstanding shares of common stock on all shareholder votes. Accordingly, Mr. Swinford will exercise control in determining the outcome of all corporate transactions or other matters, including the election of directors, mergers, consolidations, the sale of all or substantially all of our assets, and also the power to prevent or cause a change in control. The interests of Mr. Swinford may differ from the interests of the other stockholders and thus result in corporate decisions that are adverse to other shareholders.

WE RELY ON OUR CHIEF EXECUTIVE OFFICER AND EXECUTIVE VICE PRESIDENT, AND IF THEY WERE TO LEAVE OUR COMPANY OUR BUSINESS PLAN COULD BE ADVERSELY EFFECTED

We rely on Charles Wayne Tynon, our Chief Executive Officer and President and Jerry Swinford, our former Chief Executive Officer and sole Director for the success of our Company. Effective June 1, 2009, Mr. Tynon entered into an Executive Compensation and Retention Agreement with us to serve as our Chief Executive Officer and President (the “Tynon Employment Agreement”). The initial term of the Tynon Employment Agreement is until December 31, 2011 (the “Initial Term”). Furthermore, the Tynon Employment Agreement is automatically renewed on January 1, 2010 and each successive year (each an “Extension Year”), unless Mr. Tynon provides the Company in writing that he will not be exercising the extension by December 1 of each year prior to the relevant January 1. Effective June 1, 2009, Mr. Swinford entered into an Executive Compensation and Retention Agreement with us to serve as our Vice President (the “Swinford Employment Agreement”), which replaced and superseded the prior employment agreements he had with the Company. The initial term of the Swinford Employment Agreement is until December 31, 2011 (the “Initial Term”). Furthermore, the Swinford Employment Agreement is automatically renewed on January 1, 2010 and each successive year (each an “Extension Year”), unless Mr. Swinford provides the Company in writing that he will not be exercising the extension by December 1 of each year prior to the relevant January 1. The Company also holds a $650,000 life insurance policy on Mr. Swinford. Mr. Tynon’s and Mr. Swinford’s experience and input creates the foundation for our business and they are responsible for the direction and control over the Company’s development activities. Moving forward, should either be lost for any reason, the Company will incur costs associated with recruiting replacements and any potential delays in operations which this may cause. If we are unable to replace Mr. Tynon and/or Mr. Swinford with another individual or individuals suitably trained in coil tubing technology we may be forced to scale back or curtail our business plan. As a result, if we were to lose the services of Mr. Tynon or Mr. Swinford for any reason, your securities in our Company could become devalued.

MR. SWINFORD WILL RETAIN THE RIGHTS TO AND OWNERSHIP OF ANY INVENTIONS HE MAY DISCOVER, ORIGINATE OR INVENT, EITHER ALONE OR WITH OTHERS PURSUANT TO HIS EMPLOYMENT AGREEMENT.

Pursuant to Mr. Swinford’s Employment Agreement with us, as amended, Mr. Swinford will retain the rights and ownership of any discoveries, inventions, improvements, designs and innovations relating to the business of the Company (the “Inventions”), whether or not patentable, copyrightable or reduced to writing that he may discover, invent or originate during the term of the Employment Agreement. While Mr. Swinford has also agreed pursuant to a Waiver of Royalties agreement to waive any royalties that he may be due for such Inventions during the term of his employment, if Mr. Swinford were to leave the Company for any reason, he would retain the ownership of any Inventions he created and we could either be forced to pay Mr. Swinford substantial royalty fees and/or cease using such Inventions. Finally, Mr. Swinford will retain ownership of the Inventions, and we will not receive any benefit if the license agreement is terminated and such Inventions are sold by Mr. Swinford or licensed to any other companies. There is a risk that if Mr. Swinford were to leave the Company, that the royalty payments due on the Inventions may be too expensive for us to afford, and we may be forced to curtail or abandon our business operations.

-14-

WE FACE CORPORATE GOVERNANCE RISKS AND NEGATIVE PERCEPTIONS OF INVESTORS ASSOCIATED WITH THE FACT THAT WE CURRENTLY HAVE ONLY THREE OFFICERS AND ONE DIRECTOR.

As Jerry Swinford is our only Director, there are no other members of the Board of Directors available to second and/or approve related party transactions involving Mr. Swinford, including the compensation Mr. Swinford is paid and the employment agreements we enter into with Mr. Swinford. Additionally, there is minimal segregation of duties between officers because we only have three officers. Therefore, investors may perceive that because no other Directors are approving related party transactions involving Mr. Swinford and only a limited number of officers are reviewing and approving our financial statements in our filings that such transactions are not fair to the Company and/or that such financial statements may contain errors. The price of our common stock may be adversely affected and/or devalued compared to similarly sized companies with multiple officers and Directors due to the investing public’s perception of limitations facing our company due to the fact that we only have three officers and only one director.

COIL TUBING SHAREHOLDERS MAY WANT TO SELL THEIR DISTRIBUTED SHARES IMMEDIATELY AFTER THEY ARE RECEIVED IN THE SPIN-OFF DISTRIBUTION AND THIS COULD ADVERSELY AFFECT THE MARKET FOR OUR SECURITIES

Coil Tubing will distribute up to 20,000,000 shares of our common stock to its shareholders in the spin-off Distribution. The Coil Tubing shareholders that will now be our shareholders may not be interested in retaining their investment in us. Since Coil Tubing shareholders will receive registered shares in the Distribution, they will generally be free to resell their shares immediately upon receipt. However, shareholders of Coil Tubing or us who are affiliates of us or Coil Tubing will receive restricted shares of our common stock, which will be subject to the volume limitation provisions of Rule 144 of the Securities Act of 1933, as amended (the “Act”). If any number of the Coil Tubing shareholders offers their shares for sale, the market for our securities could be adversely affected.

STATE SECURITIES LAWS MAY LIMIT SECONDARY TRADING, WHICH MAY RESTRICT THE STATES IN WHICH AND CONDITIONS UNDER WHICH YOU CAN SELL SHARES.

Secondary trading in our common stock will not be possible in any state until the common stock is qualified for sale under the applicable securities laws of the state or there is confirmation that an exemption, such as listing in certain recognized securities manuals, is available for secondary trading in the state. If we fail to register or qualify, or to obtain or verify an exemption for the secondary trading of, the common stock in any particular state, the common stock could not be offered or sold to, or purchased by, a resident of that state. In the event that a significant number of states refuse to permit secondary trading in our common stock, the liquidity for the common stock could be significantly impacted.

WE HAVE ARRANGEMENTS IN PLACE WITH VARIOUS MANUFACTURERS TO BUILD AND PRODUCE OUR PRODUCTS, AND IF THE DEMAND FOR THOSE MANUFACTURERS’ SKILLS INCREASES, THE COST OF PRODUCING OUR PRODUCTS MAY INCREASE, CAUSING OUR PROFITS (IF ANY) TO DECREASE.

We currently have a number of arrangements with various manufacturing shops which manufacture our Coil Tubing Technology tools and equipment. In the event that the demand for those manufacturers’ time and unique skills increase, we may be forced to pay more money to have our products manufactured. If this were to happen, we may be forced to charge more for our products, which may cause the demand for our products and consequently our sales to decrease, which would likely cause any securities which you hold to decrease as well. Additionally, if the materials which our products are made from, including steel, increase in cost, it could similarly cause increases in the cost of manufacturing our products, which could force us to increase the prices we charge for our products, which could cause the demand for such products to decline.

-15-

OUR FUTURE SUCCESS AND PROFITABILITY MAY BE ADVERSELY AFFECTED IF WE OR OUR SUPPLIERS FAIL TO DEVELOP AND INTRODUCE NEW AND INNOVATIVE PRODUCTS AND SERVICES THAT APPEAL TO OUR CUSTOMERS.

The oil and gas drilling industry is characterized by continual technological developments that have resulted in, and likely will continue to result in, substantial improvements in the scope and quality of oilfield chemicals, drilling and artificial lift products and services and product function and performance. As a result, our future success depends, in part, upon our and our suppliers’ continued ability to develop and introduce new and innovative products and services in order to address the increasingly sophisticated needs of our customers and anticipate and respond to technological and industry advances in the oil and gas drilling industry in a timely manner. If we or our suppliers fail to successfully develop and introduce new and innovative products and services that appeal to our customers, or if new companies or our competitors offer such products and services, our revenue and profitability may suffer.

OUR ABILITY TO GROW AND COMPETE IN THE FUTURE WILL BE ADVERSELY AFFECTED IF ADEQUATE CAPITAL IS NOT AVAILABLE.

The ability of our business to grow and compete depends on the availability of adequate capital, which in turn depends in large part on our cash flow from operations and the availability of equity and debt financing. Our cash flow from operations may not be sufficient or we may not be able to obtain equity or debt financing on acceptable terms or at all to implement our growth strategy. As a result, adequate capital may not be available to finance our current growth plans, take advantage of business opportunities or respond to competitive pressures, any of which could harm our business.

WE DO NOT CURRENTLY HAVE INSURANCE POLICIES AND COULD THEREFORE SUFFER LIABILITY FOR RISKS ASSOCIATED WITH OUR OPERATIONS.

Our operations are subject to hazards inherent in the oil and gas industry, such as, but not limited to, accidents, blowouts, explosions, fires, oil and chemical spills and other hazards. These conditions can cause personal injury or loss of life, damage to property, equipment and the environment, and suspension of oil and gas operations of our customers. Litigation arising from a catastrophic occurrence at a location where our equipment, products or services are being used may result in us being named as a defendant in lawsuits asserting large claims. We do not currently have insurance for our operations because of the high premium costs. As a result, losses and liabilities arising from uninsured events could have a material adverse effect on our business, financial condition and results of operations.

IF WE ARE UNABLE TO ADEQUATELY PROTECT OUR INTELLECTUAL PROPERTY RIGHTS OUR BUSINESS IS LIKELY TO BE ADVERSELY AFFECTED.

We rely on a combination of patents, trademarks, non-disclosure agreements and other security measures to establish and protect our proprietary rights. The measures we have taken or may take in the future may not prevent misappropriation of our proprietary information or prevent others from independently developing similar products or services, designing around our proprietary or patented technology or duplicating our products or services. Furthermore, some of our intellectual property rights are only protected by patent applications filed by Mr. Swinford, and he may choose to not move forward with those patent applications in the future. Finally, Mr. Swinford’s patent applications may not be granted in the future. In the event that Mr. Swinford does not move forward with the patent applications and/or does not obtain registration of those patents, we will have a diminished ability to protect our proprietary technology, which could cause us to spend substantial funds in connection with litigation and/or may force us to curtail or abandon our business activities.

-16-

A SIGNIFICANT AMOUNT OF OUR REVENUES ARE DUE TO ONLY A SMALL NUMBER OF CUSTOMERS, AND IF WE WERE TO LOSE ANY OF THOSE CUSTOMERS, OUR RESULTS OF OPERATIONS WOULD BE ADVERSELY AFFECTED.

The Company had four customers that represented approximately 34%, 22%, 17%, and 11% of gross sales for the year ended December 31, 2008. For the year ended December 31, 2007, we had three customers, who accounted for 61%, 15%, and 10% of our net sales. As a result, the majority of revenues for the years ended December 31, 2008 and 2007 were due to only a small number of customers, and we anticipate this trend continuing moving forward. Additionally, we do not have any contracts in place with any of our customers and instead operate purchase order to purchase order with such customers. As a result, a termination in relationship or a reduction in orders from these customers could have a materially adverse effect on our results of operations and could force us to curtail or abandon our current business operations.

A SIGNIFICANT AMOUNT OF OUR REVENUES COME FROM AN ENTITY WHICH IS ALSO OUR COMPETITOR, AND IF WE WERE TO LOSE SUCH CUSTOMER, OR IT WERE TO CREATE PRODUCTS TO DIRECTLY COMPETE WITH OURS, OUR RESULTS OF OPERATIONS WOULD BE ADVERSELY AFFECTED.

For the year ended December 31, 2008, a significant portion of our revenues, approximately 27%, came from, one customer which is also a competitor of us. While such company does not currently compete directly for our products, it offers similar products. If such entity, or any other entity which is a customer of ours, creates products in the future which directly compete with ours, such entities will likely cease using our services and our revenues could be adversely affected. Similarly, we could lose additional customers to such directly competing competitors, which would further cause a decrease in our results of operations.

OUR REVENUES ARE SUBJECT TO SEASONAL RULES AND REGULATIONS, SUCH AS THE FROST LAWS ENACTED BY SEVERAL STATES AND CANADA, WHICH COULD CAUSE OUR OPERATIONS TO BE SUBJECT TO WIDE SEASONAL VARIATIONS.

Certain states which experience below freezing temperatures during the winter months, and Canada have enacted Frost Laws, which put maximum weight limits on certain public roads during the coldest months of the years, to help prevent damage to the roads caused by frost heaves. As a result, our revenues may be limited in such cold weather states (and Canada) by such Frost Laws and our results of operations for those winter months may be substantially less than our results of operations during the summer months. We currently rent tools in California, Utah, West Texas, South Texas, East Texas, Louisiana, and Canada and for use on the North Sea in Norway. As a result, our results of operations for one quarterly period may not give an accurate projection of our results of operations for the entire fiscal year and/or may vary significantly from one quarter to the other.

WE MAY NOT BE ABLE TO SUCCESSFULLY MANAGE OUR GROWTH, WHICH COULD LEAD TO OUR INABILITY TO IMPLEMENT OUR BUSINESS PLAN.

Our growth is expected to place a significant strain on our managerial, operational and financial resources, especially considering that we currently only have two executive officers and one Director. Further, as we enter into additional contracts, we will be required to manage multiple relationships with various consultants, businesses and other third parties. These requirements will be exacerbated in the event of our further growth or in the event that the number of our drilling and/or extraction operations increases. Our systems, procedures and/or controls may not be adequate to support our operations or that our management will be able to achieve the rapid execution necessary to successfully implement our business plan. If we are unable to manage our growth effectively, our business, results of operations and financial condition will be adversely affected, which could lead to us being forced to abandon or curtail our business plan and operations.

-17-

OUR FORMER CHIEF EXECUTIVE OFFICER AND SOLE DIRECTOR IS ALSO THE CHIEF EXECUTIVE OFFICER AND SOLE DIRECTOR OF OUR PARENT, COIL TUBING, AND AS SUCH, MAY NOT BE ABLE TO DEVOTE SUFFICIENT TIME TO OUR OPERATIONS.

Jerry Swinford, our Former Chief Executive Officer, and the current Executive Vice President and sole Director is also the Chief Executive Officer and Director of Coil Tubing, our Parent. As such and because Mr. Swinford spends approximately 30 hours per week on Company matters and approximately 20 hours per week on matters relating to Coil Tubing, he may not be able to devote a sufficient amount of time to our operations. This may be exacerbated by the fact that he is currently one of only three of our officers and our sole Director. Furthermore, because we operate in the coil tubing industry (as does Coil Tubing, although Coil Tubing currently has no operations separate from the Company) there may be conflicts between suppliers, contracts, agreements, use of patents and/or other business relations between Coil Tubing and us. Additionally, investors should keep in mind that there are no policies in place in regard to the allocation of corporate opportunities between us, Coil Tubing or Mr. Swinford personally.

WE MAY BE LATE IN FILING OUR PERIODIC REPORTS OR MAY NOT BE ABLE TO FILE OUR PERIODIC REPORTS AS WE ONLY HAVE THREE OFFICERS AND ONE DIRECTOR, AND OUR SOLE DIRECTOR WHO IS ALSO THE SOLE OFFICER AND DIRECTOR OF OUR PARENT COMPANY, COIL TUBING, IS DELINQUENT IN ITS FILINGS.

Our former Chief Executive Officer, the current Executive Vice President and current sole Director, Jerry Swinford, is also the sole officer and Director of Coil Tubing, which is currently deficient in its filing obligations with the SEC, and has been delinquent since approximately May 2003 (when it was still IPMC Holdings Corp. (as described in greater detail above under “Business”)). Although Mr. Swinford, with the assistance of legal and accounting professionals, has previously tried to obtain the required financial information to file Coil Tubing’s delinquent periodic filings with the SEC, he has not been able to obtain that information. As such, Coil Tubing remains deficient in its current and periodic filings with the SEC, and is not likely to, and currently has no plans to ever file such deficient reports. As a result of Coil Tubing’s deficient filings, Coil Tubing’s shareholders do not have any current financial or other information regarding Coil Tubing. Further, as Mr. Swinford is also an officer and the sole Director of the Company, and the Company has similar current and periodic reporting obligations with the SEC, there is a risk that the Company may not meet these filing obligations and that investors similarly may not receive current information regarding their investment in the Company. If this were to occur it may be difficult if not impossible for investors to sell their shares in the Company, we could be delisted from any market or exchange on which our common stock then trades, if any, and the value of our common stock could become worthless.

RISKS RELATED TO OUR INDUSTRY

VOLATILITY OR DECLINE IN OIL AND NATURAL GAS PRICES MAY RESULT IN REDUCED DEMAND FOR OUR PRODUCTS AND SERVICES WHICH MAY ADVERSELY AFFECT OUR BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATION.

The markets for oil and natural gas have historically been extremely volatile. We anticipate that these markets will continue to be volatile in the future. Although oil and gas prices have increased significantly in recent years, there can be no guarantees that these prices will remain at current levels. Such volatility in oil and gas prices, or the perception by our customers of unpredictability in oil and natural gas prices, affects the spending patterns in our industry. The demand for our products and services is, in large part, driven by current and anticipated oil and gas prices and the related general levels of production spending and drilling activity. In particular, volatility or a decline in oil and gas prices may cause a decline in exploration and drilling activities. This, in turn, could result in lower demand for our products and services and may cause lower prices for our products and services. As a result, volatility or a prolonged decline in oil or natural gas prices may adversely affect our business, financial condition and results of operations.

-18-

COMPETITION FROM NEW AND EXISTING COMPETITORS WITHIN OUR INDUSTRY COULD HAVE AN ADVERSE EFFECT ON OUR RESULTS OF OPERATIONS.

The oil and gas industry is highly competitive and fragmented. Our principal competitors include numerous small coil tubing companies capable of competing effectively in our markets on a local basis as well as a number of large coil tubing companies that possess substantially greater financial and other resources than we do. Furthermore, we face competition from companies working to develop advanced oil and gas technology which would compete with us and other coil tubing companies. Additionally, our larger competitors may be able to devote greater resources to developing, promoting and selling their products and services. We may also face increased competition due to the entry of new competitors including current suppliers that decide to sell or rent their coil tubing products and services directly. As a result of this competition, we may experience lower sales if our prices are undercut or advanced technology is brought to market which accomplishes greater results on average than our technology, which would likely have an adverse effect on our results of operations and force us to curtail or abandon our current business plan.

OUR RESULTS OF OPERATIONS MAY BE NEGATIVELY AFFECTED BY SUSTAINED DOWNTURNS OR SLUGGISHNESS IN THE ECONOMY, INCLUDING REDUCTIONS IN DEMAND OR LOW LEVELS IN THE MARKET PRICES OF COMMODITIES, ALL OF WHICH ARE BEYOND OUR CONTROL.

Sustained downturns in the economy generally affect the markets in which we operate and negatively influence our operations. Declines in demand for oil and gas as a result of economic downturns may reduce our cash flows, especially if our customers reduce exploration and production activities and, therefore, use of our products.

Lower demand for oil and gas and lower prices for oil and gas result from multiple factors that affect the markets which consume our products and services:

	•	supply of and demand for energy commodities, including any decreases in the production of oil and gas which could negatively affect the demand for oil and gas in general, and as a result the need for our coil tubing technology;

	•	general economic conditions, including downturns in the United States, Canada or other economies which affect energy consumption particularly in which sales to industrial or large commercial customers which could negatively affect the demand for oil and gas in general, and as a result the need for our coil tubing technology; and

	•	federal, state and foreign energy and environmental regulations and legislation, which could make oil and gas exploration more costly, which could in turn drive down demand for oil and gas, and which could in turn reduce the demand for our technology and cause our revenues to decrease.

THE LONG-TERM FINANCIAL CONDITION OF OUR BUSINESSES IS DEPENDENT ON THE CONTINUED AVAILABILITY OF OIL AND GAS RESERVES.

Our businesses are dependent upon the continued availability of oil production and reserves. Low prices for oil and gas, regulatory limitations, or the lack of available capital for these projects could adversely affect the development of additional reserves and production, and, therefore, demand for our products and services.

OUR BUSINESS IS SUBJECT TO EXTENSIVE REGULATION THAT AFFECTS OUR OPERATIONS AND COSTS.

Our assets and operations are subject to regulation by federal, state and local authorities, including regulation by the Federal Energy Regulatory Commission (“FERC”) and regulation by various authorities under federal, state and local environmental laws. Regulation affects almost every aspect of our businesses, including, among other things, our ability to determine the terms and rates of services provided by some of our businesses; make acquisitions; issue equity or debt securities; and pay dividends. Changes in such regulations may affect our capacity to conduct this business effectively and sustain or increase profitability.

-19-

RISKS RELATING TO THE SPIN-OFF

WE MAY BE UNABLE TO ACHIEVE SOME OR ALL OF THE BENEFITS THAT WE EXPECT TO ACHIEVE FROM OUR SEPARATION FROM COIL TUBING.

We may not be able to achieve the full strategic and financial benefits that we expect will result from our separation from Coil Tubing or such benefits may be delayed or may not occur at all. For example, analysts and investors may not regard our corporate structure as clearer and simpler than the current Coil Tubing corporate structure or place a greater value on our Company as a stand-alone company than on our businesses being a part of Coil Tubing. As a result, in the future the aggregate market price of Coil Tubing’s common stock and our common stock as separate companies may be less than the market price per share of Coil Tubing’s common stock had the separation and distribution not occurred.

WE ARE BEING SEPARATED FROM COIL TUBING, OUR PARENT COMPANY, AND, THEREFORE, WE HAVE A LIMITED OPERATING HISTORY AS A SEPARATE COMPANY.

The historical and financial information does not necessarily reflect the financial condition, results of operations or cash flows that we would have achieved as a separate publicly-traded company during the periods presented or those that we will achieve in the future primarily as a result of the following factors:

•

Since November 2005, our business has in part been operated by Coil Tubing as part of its broader corporate organization, rather than as a separate, publicly-traded company; and

•

Other significant changes may occur in our cost structure, management, financing and business operations as a result of our operating as a company separate from Coil Tubing.

THE DISTRIBUTION OF OUR SHARES MAY RESULT IN TAX LIABILITY.

Shareholders of Coil Tubing may be required to pay income tax on the value of shares of common stock received in connection with the spin-off Distribution. This Distribution may be taxable as a dividend and/or as a capital gain, depending upon the extent of the basis in Coil Tubing stock which such shareholders hold. Shareholders of Coil Tubing are advised to consult their own tax advisor as to the specific tax consequences of the Distribution.

THE DISTRIBUTION MAY CAUSE THE TRADING PRICE OF COIL TUBING’S COMMON STOCK TO DECLINE.

Following the Distribution, Coil Tubing expects that its common stock will continue to be quoted and traded on the Pink Sheets under the symbol “CTBG.” A trading market may not continue for the shares of Coil Tubing’s common stock or even develop for our shares. As a result of the Distribution, the trading price of Coil Tubing’s common stock may be substantially lower following the Distribution than the trading price of Coil Tubing’s common stock immediately prior to the Distribution. The closing price of Coil Tubing’s common stock was approximately $0.05 at March 31, 2009, $0.06 at December 31, 2008, $0.06 at September 30, 2008, $0.048 at June 30, 2008, $0.057 at March 31, 2008, $0.03 at December 31, 2007, $0.034 at September 28, 2007, $0.031 at June 29, 2007, $0.022 at March 30, 2007, and $0.0275 at December 29, 2006.

-20-

Further, the combined trading prices of Coil Tubing’s common stock and our common stock after the Distribution may be less than the trading price of Coil Tubing’s common stock immediately prior to the Distribution.

THE LACK OF A BROKER OR DEALER TO CREATE OR MAINTAIN A MARKET IN OUR STOCK COULD ADVERSELY IMPACT THE PRICE AND LIQUIDITY OF OUR SECURITIES.

We have no agreement with any broker or dealer to act as a market maker for our securities and as a result, we may not be successful in obtaining any market makers. Thus, no broker or dealer will have an incentive to make a market for our stock. The lack of a market maker for our securities could adversely influence the market for and price of our securities, as well as your ability to dispose of, or to obtain accurate information about, and/or quotations as to the price of, our securities.

RISKS RELATING TO OUR SECURITIES

WE LACK A MARKET FOR OUR COMMON STOCK, WHICH MAKES OUR SECURITIES VERY SPECULATIVE.

We currently lack a market for the Company’s common stock. Because of this, it is hard to determine exactly how much our securities are worth. As a result of the lack of market, it is hard to judge how much our securities are worth and it is possible that they will become worthless.

WE HAVE NOT PAID ANY CASH DIVIDENDS IN THE PAST AND HAVE NO PLANS TO ISSUE CASH DIVIDENDS IN THE FUTURE, WHICH COULD CAUSE THE VALUE OF OUR COMMON STOCK TO HAVE A LOWER VALUE THAN OTHER SIMILAR COMPANIES WHICH DO PAY CASH DIVIDENDS.

We have not paid any cash dividends on our common stock to date and do not anticipate any cash dividends being paid to holders of our common stock in the foreseeable future. While our dividend policy will be based on the operating results and capital needs of the business, it is anticipated that any earnings will be retained to finance our future expansion. As we have no plans to issue cash dividends in the future, our common stock could be less desirable to other investors and as a result, the value of our common stock may decline, or fail to reach the valuations of other similarly situated companies who have historically paid cash dividends in the past.

IF THERE IS A MARKET FOR OUR COMMON STOCK, OUR STOCK PRICE MAY BE VOLATILE.

If there's a market for our common stock, we anticipate that such market would be subject to wide fluctuations in response to several factors, including, but not limited to:

	(1)	actual or anticipated variations in our results of operations;
	(2)	our ability or inability to generate new revenues;
	(3)	increased competition; and
	(4)	conditions and trends in the oil and gas industry and/or the market for coil tubing technology products and tools in general.

Further, if our common stock is traded on the over the counter bulletin board, as is our intention, our stock price may be impacted by factors that are unrelated or disproportionate to our operating performance. These market fluctuations, as well as general economic, political and market conditions, such as recessions, interest rates or international currency fluctuations may adversely affect the market price of our common stock.

-21-

INVESTORS MAY FACE SIGNIFICANT RESTRICTIONS ON THE RESALE OF OUR COMMON STOCK DUE TO FEDERAL REGULATIONS OF PENNY STOCKS.

Assuming our common stock is quoted on the OTC Bulletin Board, it will be subject to the requirements of Rule 15(g)9, promulgated under the Securities Exchange Act as long as the price of our common stock is below $5.00 per share. Under such rule, broker-dealers who recommend low-priced securities to persons other than established customers and accredited investors must satisfy special sales practice requirements, including a requirement that they make an individualized written suitability determination for the purchaser and receive the purchaser's consent prior to the transaction. The Securities Enforcement Remedies and Penny Stock Reform Act of 1990, also requires additional disclosure in connection with any trades involving a stock defined as a penny stock. Generally, the Commission defines a penny stock as any equity security not traded on an exchange or quoted on NASDAQ that has a market price of less than $5.00 per share. The required penny stock disclosures include the delivery, prior to any transaction, of a disclosure schedule explaining the penny stock market and the risks associated with it. Such requirements could severely limit the market liquidity of the securities and the ability of purchasers to sell their securities in the secondary market.

WE HAVE BEEN FORCED TO BRING SUIT AGAINST OUR FORMER LARGEST SHAREHOLDER, GRIFCO INTERNATIONAL, INC., ITS PRESIDENT AND THE DEPOSITORY TRUST & CLEARING CORPORATION WHICH WILL IMPACT OUR OPERATIONS.

As is more fully described below under Legal Proceedings, on July 30, 2008, the Company, Coil Tubing’s President and our former President, Jerry Swinford (“Plaintiffs”) filed a lawsuit against Grifco International, Inc. (“Grifco”), the Depository Trust & Clearing Corporation (DTCC/DTC) and the President of Grifco, James Dial (“Defendants”). The case is pending as Cause No. 08-07-07397-CV in Montgomery County Texas, District Court, 9th Judicial District. The suit stems from Grifco’s stock distribution of 75,000,000 shares of Coil Tubing’s common stock in August 2007 ("Grifco Distribution").

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

In January 2009, our Board of Directors approved the issuance of 1,050,000 shares of our common stock to Jerry Swinford (representing 5% of our then outstanding shares of common stock), our then Chief Executive Officer and President, and current Executive Vice President, in connection with the extension of the Employment Agreement from January 1, 2009 to December 31, 2009.

Effective June 1, 2009, in connection with Mr. Tynon’s Employment Agreement (described below), the Board of Directors agreed to issue Mr. Tynon 750,000 shares of the Company’s restricted common stock in consideration for him agreeing to the terms of the Tynon Employment Agreement which shares are not included in the number of outstanding shares disclosed throughout this report, as such shares have not been physically issued to date.

The Company claims an exemption from registration afforded by Section 4(2) of the Act since the above issuances did not involve a public offering, the recipients took the shares for investment and not resale, the recipients had such access to similar information which would be included in an offering prospectus, and the Company took appropriate measures to restrict transfer. No underwriters or agents were involved in the issuance and no underwriting discounts or commissions were paid by the Company.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

-22-

ITEM 5. OTHER INFORMATION

Effective June 1, 2009, Jerry Swinford resigned as Chief Executive Officer, Chief Financial Officer and President of the Company and Charles Wayne Tynon was appointed as the Chief Executive Officer and President of the Company. Effective June 1, 2009, Mr. Swinford was appointed as Executive Vice President. Mr. Swinford continues to serve as the sole Director of the Company.

Charles Wayne Tynon – Age 58

Mr. Tynon was previously employed as a special project consultant by the Company from December 2007 to February 2009, for which he was paid $3,000 per month in consulting fees. From June 2008 to October 2008, Mr. Tynon served as the Manager of Superior Energy. From September 2001 to May 2008, Mr. Tynon served as an Operations Manager with Complete Production Services (formerly Arkoma Fishing and Rental). From February 2000 to June 2000, Mr. Tynon served as a consultant to and worked in Inventory Control for Federal Coach, a manufacturing company. From March 1983 to August 1999, Mr. Tynon served as Vice President of International Operations with Ponder Industries (formerly Panther Oil Tools). From August 1978 to September 1982, Mr. Tynon served as Regional Sales Manager for Baker Hughes Intec (formerly Tri-State Fishing and Rental) for Europe, Africa and the Middle East. From September 1973 to June 1978, Mr. Tynon served various divisions for the Intairdril Companies in Europe, Africa and the Middle East in different capacities.

Mr. Tynon received his Bachelors degree in Journalism from the University of Arkansas.

On or around June 1, 2009, Coil Tubing entered into a Line of Credit Promissory Note (the “Line of Credit”) with Charles Wayne Tynon. Pursuant to the Line of Credit, Mr. Tynon agreed to loan Coil Tubing up to $250,000. Any amounts borrowed under the Line of Credit bear interest at the rate of 6% per annum, payable at maturity, which maturity date is June 1, 2011. The Line of Credit is secured by a Security Agreement entered into between Coil Tubing and Mr. Tynon (the “Security Agreement”). At any time after June 1, 2010, Mr. Tynon can convert the then outstanding amount of the Line of Credit into shares of Coil Tubing’s common stock at a conversion price of $0.0033333 per share. The Security Agreement provides Mr. Tynon a first priority security interest in all of Coil Tubing’s current or future, machinery and equipment, inventory and proceeds or products derived therefrom, and rights under contracts, causes of action, documents, and evidence of title to inventory and contract rights. As of the date of this filing a total of $60,000 has been borrowed under the Line of Credit.

Employment Agreements:

Tynon Employment Agreement:

-23-

Mr. Tynon’s Employment Agreement can be terminated by us for “Cause,” defined as if Mr. Tynon:

	a)	commits any intentional act of dishonesty, fraud, misrepresentation, misappropriation or embezzlement which has a material detriment on the Company;

	b)	uses or discloses any confidential information or trade secrets of the Company, which has not been authorized by us, and which has a material detriment on the Company;

	c)	significantly violates any law or regulation applicable to our business, which has a material detrimental impact on us, and the Board of Directors reasonably determines causes or is reasonably likely to cause material injury to us;

	d)	is indicted of, or convicted of, or pleads nolo contendere or guilty in connection with any felony or any other crime which involves moral turpitude;

	e)	continually fails in his efforts to perform his duties and responsibilities in connection with his positions, after giving notice thereof and thirty (30) days to cure such failure, or his gross negligence or willful misconduct in the performance of his duties; or

	f)	materially and willfully breaches his fiduciary duties to us (each a termination “For Cause”).

The Tynon Employment Agreement can also be terminated without cause by Mr. Tynon or us at any time for any reason, provided the terminating party gives thirty (30) days written notice to the non-terminating party (a termination “Without Cause”). Finally, the Tynon Employment Agreement will be construed as constructively terminated if Mr. Tynon terminates the Tynon Employment Agreement within six (6) months following:

	a)	his demotion by us to a lesser position in title or responsibility;

	b)	the decrease of Mr. Tynon’s compensation below the highest level of executive compensation we have in effect at any time;

	c)	our requirement that Mr. Tynon relocate to a principal place of business more than fifty 50 miles away from our current office space or 50 miles away from his current address in Fort Smith, Arkansas;

	d)	if we are subject to a change of control (defined as if more than 33% of the voting shares of the Company are acquired by a third party in a plan of reorganization, merger or consolidation); or

	e)	if we breach any material term of the Tynon Employment Agreement, which is not cured within thirty (30) days after receiving written notice of such breach (each a “Constructive Termination”).

Following the termination of Mr. Tynon’s employment For Cause, or by Mr. Tynon, Without Cause, we are obligated to pay him any compensation earned by him, but not yet paid, to issue him any of the shares of common stock he may be due, but which have not been issued to date, as provided above, and to provide him health insurance until the end of the then current term. Following the termination of Mr. Tynon’s employment by the Company Without Cause or any Constructive Termination, we are required to pay him any compensation he would have been due assuming the Tynon Employment Agreement had continued through the then current term, issue him any shares he would have been due assuming the Tynon Employment Agreement continued in effect through the then current term, to provide him health insurance until the end of the then current term, and to pay him as a lump sum an additional $100,000. Following the termination of the Tynon Employment Agreement, as provided in the Tynon Employment Agreement, due to Mr. Tynon’s disability or death, we are required to pay him any amount of compensation earned but not paid, provide him and his wife health insurance through the then current term, and to issue him any and all shares which he would have been due assuming the Tynon Employment Agreement continued in effect until the then of the then current term.

-24-

Swinford Employment Agreement:

Effective June 1, 2009, Mr. Swinford entered into an Executive Compensation and Retention Agreement with us to serve as our Vice President (the “Swinford Employment Agreement”), which replaced and superseded the prior employment agreements he had with the Company. The initial term of the Swinford Employment Agreement is until December 31, 2011 (the “Initial Term”). Furthermore, the Swinford Employment Agreement is automatically renewed on January 1, 2010 and each successive year (each an “Extension Year”), unless Mr. Swinford provides the Company in writing that he will not be exercising the extension by December 1 of each year prior to the relevant January 1.

The Swinford Employment Agreement provides for Mr. Swinford to receive a salary of $132,000 for the first year of the Swinford Employment Agreement (pro rated for the remainder of the year), with yearly increases, of a minimum of 10% of the prior year’s salary. Additionally, pursuant to the Swinford Employment Agreement, at the expiration of the Initial Term and each Extension Year he is employed under the Swinford Employment Agreement, we agreed to issue him additional shares of common stock equal to 5% of our then shares of outstanding common stock (excluding any shares of common stock issuable to other executives of the Company as a result of incentive share clauses of such executive’s employment agreements).

Mr. Swinford’s Employment Agreement can be terminated by us for “Cause,” defined as if Mr. Swinford:

	a)	commits any intentional act of dishonesty, fraud, misrepresentation, misappropriation or embezzlement which has a material detriment on the Company;

	b)	uses or discloses any confidential information or trade secrets of the Company, which has not been authorized by us, and which has a material detriment on the Company;

	c)	significantly violates any law or regulation applicable to our business, which has a material detrimental impact on us, and the Board of Directors reasonably determines causes or is reasonably likely to cause material injury to us;

	d)	is indicted of, or convicted of, or pleads nolo contendere or guilty in connection with any felony or any other crime which involves moral turpitude;

	e)	continually fails in his efforts to perform his duties and responsibilities in connection with his positions, after giving notice thereof and thirty (30) days to cure such failure, or his gross negligence or willful misconduct in the performance of his duties; or

	f)	materially and willfully breaches his fiduciary duties to us (each a termination “For Cause”).

The Swinford Employment Agreement can also be terminated without cause by Mr. Swinford or us at any time for any reason, provided the terminating party gives thirty (30) days written notice to the non-terminating party (a termination “Without Cause”). Finally, the Swinford Employment Agreement will be construed as constructively terminated if Mr. Swinford terminates the Swinford Employment Agreement within six (6) months following:

	a)	his demotion by us to a lesser position in title or responsibility;

	b)	the decrease of Mr. Swinford’s compensation below the highest level of executive compensation we have in effect at any time;

	c)	our requirement that Mr. Swinford relocate to a principal place of business more than fifty 50 miles away from our current office space or 50 miles away from his current address in Fort Smith, Arkansas;

	d)	if we are subject to a change of control (defined as if more than 33% of the voting shares of the Company are acquired by a third party in a plan of reorganization, merger or consolidation); or

	e)	if we breach any material term of the Swinford Employment Agreement, which is not cured within thirty (30) days after receiving written notice of such breach (each a “Constructive Termination”).

-25-

Following the termination of Mr. Swinford’s employment For Cause, or by Mr. Swinford, Without Cause, we are obligated to pay him any compensation earned by him, but not yet paid, to issue him any of the shares of common stock he may be due, but which have not been issued to date, as provided above, and to provide him and his wife health insurance until the end of the then current term. Following the termination of Mr. Swinford’s employment by the Company Without Cause or any Constructive Termination, we are required to pay him any compensation he would have been due assuming the Swinford Employment Agreement had continued through the then current term, issue him any shares he would have been due assuming the Swinford Employment Agreement continued in effect through the then current term, to provide him and his wife health insurance until the end of the then current term, and to pay him as a lump sum an additional $100,000. Following the termination of the Swinford Employment Agreement, as provided in the Swinford Employment Agreement, due to Mr. Swinford’s disability or death, we are required to pay him any amount of compensation earned but not paid, provide him and his wife health insurance through the then current term, and to issue him any and all shares which he would have been due assuming the Swinford Employment Agreement continued in effect until the then of the then current term.

ITEM 6. EXHIBITS

Exhibit Number	Description of Exhibit

Exhibit 3.1(1)	Articles of Incorporation (Texas)
Exhibit 3.2(1)	Plan of Conversion (Texas to Nevada)
Exhibit 3.3(1)	Articles of Conversion (Texas)
Exhibit 3.4(1)	Articles of Conversion (Nevada)
Exhibit 3.5(1)	Articles of Incorporation (Nevada)
Exhibit 3.6(1)	Series A Preferred Stock Designation
Exhibit 3.7(1)	Bylaws (Nevada)
Exhibit 10.1(1)	Acquisition Agreement with Grifco International, Inc.
Exhibit 10.2(1)	Hammelmann Statement of Understanding Coil Tubing Cleaner
Exhibit 10.3(1)	Hammelmann Statement of Understanding RotorJet and TurboJet
Exhibit 10.4(1)	Agreement For Exchange of Common Stock between Grifco and Coil Tubing
Exhibit 10.5(1)	Agreement and Release between Grifco and Coil Tubing
Exhibit 10.6(1)	Restatement and Novation of Agreement for Exchange of Common Stock between Grifco and Coil Tubing
Exhibit 10.7(1)	Employment Agreement with Jerry Swinford and Exhibits
Exhibit 10.8(2)	Amendment to Employment Agreement
Exhibit 10.9(2)	Amendment to Licensing Agreement
Exhibit 10.10*	Line of Credit Promissory Note with Charles Wayne Tynon
Exhibit 10.11*	Security Agreement
Exhibit 10.12*	Executive Compensation and Retention Agreement with Jerry Swinford
Exhibit 10.13*	Executive Compensation and Retention Agreement with Charles Wayne Tynon
Exhibit 16.1(3)	Letter from Li & Company, PC
Exhibit 21.1(4)	Subsidiaries of the Company
Exhibit 31.1*	Certificate of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32.1*	Certificate of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

* Filed herewith.

(1) Filed as exhibits to our Form SB-2 Registration Statement filed with the Commission on July 18, 2007, and incorporated herein by reference.

(2) Filed as exhibits to our Form SB-2A Registration Statement filed with the Commission on September 27, 2007, and incorporated herein by reference.

(3) Filed as an exhibit to our Form S-1/A Registration Statement filed with the Commission on October 11, 2008, and incorporated herein by reference.

(4) Filed as an exhibit to our Form 10-K filed with the Commission on April 23, 2009, and incorporated herein by reference.

-26-

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has caused duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	COIL TUBING TECHNOLOGY HOLDINGS, INC.

DATED: June 17, 2009
	By: /s/ Charles Wayne Tynon
	Charles Wayne Tynon
	Chief Executive Officer and President
	(Principal Executive Officer and Principal Accounting Officer)

-27-

EXHIBIT INDEX

Exhibit Number	Description of Exhibit

Exhibit 3.1(1)	Articles of Incorporation (Texas)
Exhibit 3.2(1)	Plan of Conversion (Texas to Nevada)
Exhibit 3.3(1)	Articles of Conversion (Texas)
Exhibit 3.4(1)	Articles of Conversion (Nevada)
Exhibit 3.5(1)	Articles of Incorporation (Nevada)
Exhibit 3.6(1)	Series A Preferred Stock Designation
Exhibit 3.7(1)	Bylaws (Nevada)
Exhibit 10.1(1)	Acquisition Agreement with Grifco International, Inc.
Exhibit 10.2(1)	Hammelmann Statement of Understanding Coil Tubing Cleaner
Exhibit 10.3(1)	Hammelmann Statement of Understanding RotorJet and TurboJet
Exhibit 10.4(1)	Agreement For Exchange of Common Stock between Grifco and Coil Tubing
Exhibit 10.5(1)	Agreement and Release between Grifco and Coil Tubing
Exhibit 10.6(1)	Restatement and Novation of Agreement for Exchange of Common Stock between Grifco and Coil Tubing
Exhibit 10.7(1)	Employment Agreement with Jerry Swinford and Exhibits
Exhibit 10.8(2)	Amendment to Employment Agreement
Exhibit 10.9(2)	Amendment to Licensing Agreement
Exhibit 10.10*	Line of Credit Promissory Note with Charles Wayne Tynon
Exhibit 10.11*	Security Agreement
Exhibit 10.12*	Executive Compensation and Retention Agreement with Jerry Swinford
Exhibit 10.13*	Executive Compensation and Retention Agreement with Charles Wayne Tynon
Exhibit 16.1(3)	Letter from Li & Company, PC
Exhibit 21.1(4)	Subsidiaries of the Company
Exhibit 31.1*	Certificate of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32.1*	Certificate of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

* Filed herewith.

(1) Filed as exhibits to our Form SB-2 Registration Statement filed with the Commission on July 18, 2007, and incorporated herein by reference.

(2) Filed as exhibits to our Form SB-2A Registration Statement filed with the Commission on September 27, 2007, and incorporated herein by reference.

(3) Filed as an exhibit to our Form S-1/A Registration Statement filed with the Commission on October 11, 2008, and incorporated herein by reference.

(4) Filed as an exhibit to our Form 10-K filed with the Commission on April 23, 2009, and incorporated herein by reference.

-28-

Positive
Negative
Uncertain
Constraining
Legalese
Litigous
Readability	H.S. junior Good

Coil Tubing Technology Inactive 10-Q2009 Q1 Quarterly report

Content analysis