Titan 10QSB 2008 Q3 Quarterly report (small business)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

[XX]   QUARTERLY REPORT UNDER SECTION13 OR15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 30, 2008

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

               For the transition period from _______ to _______

Commission file number  0-25024

TITAN TECHNOLOGIES, INC.

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

NEW MEXICO	85-0206831
(State or other jurisdiction	(IRS Employer Identification No.)
of incorporation or organization)

3206 Candelaria Road NE, Albuquerque, NM 87107

(Address of principal executive offices)

(505) 884-0272

(Issuer's telephone number)

N/A

(Former name, former address, and former three-months, if changed since last report)

Check whether the issuer (1) filed all reports required to be filed by section 13 of 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  [X]        No [ ]

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be filed by Section 12,13, or 15 (d) of the Exchange Act after distribution of securities under a plan confirmed by a court.  Yes[ ]       No [ ]

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: June 12, 2008 No par common 47,999,277.                                                                                                           

Transitional Small Business Format (Check One):  Yes [ ]              No     [X]

PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements.

Titan Technologies, Inc.
BALANCE SHEET
April 30, 2008
(UNAUDITED)
ASSETS
Current Assets
Cash	$	15,577
Prepaid Expense		2,525
Total Current Assets		18,102
Other Assets
Deposits		25,000
Other		609
Total Other Assets		25,609
	$	43,711
LIABILITIES AND STOCKHOLDERS'  (DEFICIT)
Current Liabilities
Accounts payable	$	2,193
Other accrued liabilities		483
Deferred revenue		470,000
Total Current Liabilities		472,676
Stockholders' (Deficit)
Common stock - no par value; authorized, 50,000,000 shares;
47,826,277 shares issued, 47,809,277 shares outstanding		4,113,014
Treasury stock, 17,000 shares, at cost		-
Accumulated (deficit)		(4,541,979	)
		(428,965	)
	$	43,711

See the accompanying notes to the financial statements.

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Titan Technologies, Inc.
STATEMENTS OF OPERATIONS
For The Three Months Ended April 30, 2008 and 2007
(UNAUDITED)
	2008			2007
REVENUES	$	-		$	-
COSTS AND EXPENSES
General and administrative		68,785			60,246
Outside services		425			1,595
Depreciation		-			27
		69,210			61,868
(Loss) from operations		(69,210	)		(61,868	)
Provision for income taxes		-			-
Net (loss)	$	(69,210	)	$	(61,868	)
Weighted average common shares outstanding -
Basic and diluted		47,602,816			45,367,339
Basic and diluted (loss) per common share	$	(0.00	)	$	(0.00	)

See the accompanying notes to the financial statements.

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Titan Technologies, Inc.
STATEMENTS OF OPERATIONS
For The Nine Months Ended April 30, 2008 and 2007
(UNAUDITED)
	2008			2007
REVENUES	$	-		$	-
COSTS AND EXPENSES
General and administrative		209,243			197,469
Outside services		4,706			13,424
Stock compensation		-			24,309
Depreciation		53			80
		214,002			235,282
(Loss) from operations		(214,002	)		(235,282	)
Provision for income taxes		-			-
Net (loss)	$	(214,002	)	$	(235,282	)
Weighted average common shares outstanding -
Basic and diluted		46,836,988			45,102,042
Basic and diluted (loss) per common share	$	(0.00	)	$	(0.01	)

See the accompanying notes to the financial statements.

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Titan Technologies, Inc.
STATEMENTS OF CASH FLOWS
For The Nine Months Ended April 30, 2008 and 2007
(UNAUDITED)
	2008			2007
Cash flows from operating activities
Net cash (used in) operating activities	$	(212,280	)	$	(79,374	)
Cash flows from investing activities
Net cash provided by investing activities		-			-
Cash flows from financing activities
Proceeds from sale of common stock		197,274			71,000
Net cash provided by financing activities		197,274			71,000
Net (decrease) in cash		(15,006	)		(8,374	)
Cash at beginning of period		30,583			34,902
Cash at end of period	$	15,577		$	26,528

See the accompanying notes to the financial statements.

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Titan Technologies, Inc.

Notes to Financial Statements

April 30, 2008

(Unaudited)

Note 1.  Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information.  They do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.  In the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair presentation, have been included in the accompanying unaudited financial statements.  Operating results for the periods presented are not necessarily indicative of the results that may be expected for the full year.  For further information, refer to the financial statements and notes thereto, included in the Company's Form 10-KSB as of and for the year ended July 31, 2007.

Note 2.  Earnings Per Share

The Company calculates net income (loss) per share as required by Statement of Financial Accounting Standards ("SFAS") 128, "Earnings per Share."  Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period.  Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding.  During the periods presented, common stock equivalents were not considered, as their effect would be anti-dilutive.

Note 3.  Going Concern

The Company's financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

The Company has experienced losses from operations as a result of its investment necessary to achieve its operating plan, which is long-range in nature. For the nine months ended April 30, 2008 the Company incurred a net loss of $214,002 and had working capital and stockholders' deficits of $454,574 and $428,965, respectively, at April 30, 2008. In addition, the Company has no revenue producing operations.

The Company's ability to continue as a going concern is contingent upon its ability to secure financing and attain profitable operations. In addition, the Company's ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered in a highly regulated industry.

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Titan Technologies, Inc.

Notes to Financial Statements

April 30, 2008

(Unaudited)

The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of

liabilities that may result from the possible inability of the Company to continue as a going concern.

Note 4. Stockholders' (Deficit)

During the nine months ended April 30, 2008 the Company sold 1,846,438 shares of common stock for cash proceeds aggregating $197,274.

The Company has a compensatory stock option plan.  Under the plan, the Company may grant options for up to 1,350,000 shares of common stock.  The Board of Directors shall determine the exercise price and term of the options.  The options vest on the date granted. All options outstanding at April 30, 2008 were granted to employees or directors in the fiscal year ended July 31, 2005 and expire in the year ending July 31, 2015.

Summarized information relative to the Company's stock option is as follows:

	Number of			Weighted Average
	Shares			Exercise Price
Outstanding at July 31, 2007		1,350,000		$	0.12
Granted		-			-
Exercised		(300,000	)		0.12
Forfeited		-			-
Outstanding at April 30, 2008		1,050,000		$	0.12

Note 5.  Licensing Agreements

On April 2, 2004, and as modified on October 30, 2004, the Company entered into an Agreement with a group of investors, to provide for the construction of three tire recycling plants to be built in Mexico. During the year ended July 31, 2005, the Company received a non-refundable deposit of $180,000, which was originally recorded as deferred revenue. Under the terms of the agreement, the Company was to receive a payment of $500,000.  $300,000 was to be credited to licensing fees, ($100,000 for each of the three initial recycling plants), and the remaining $200,000 for an exclusive right to license the Titan technology in Mexico. The original Agreement was extended from September 30, 2004 to March 31, 2005, whereupon it was terminated effective March 31, 2005, due to non-performance by the licensee. As more fully discussed below, the $180,000 previously paid to Titan under this agreement was recognized as revenue, and credit has been given to the successor investor, PPT Holding, Ltd. ("PPT"), in this amount.

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Titan Technologies, Inc.

Notes to Financial Statements

April 30, 2008

(Unaudited)

Effective February 9, 2006, the Registrant executed a License Agreement with PPT, a Texas Limited Partnership and successor to the investor group discussed above, for the exclusive right to build recycling facilities in Mexico, utilizing Titan’s patented tire recycling technology (the “Mexican License”). The Agreement provides for the initial construction of three facilities within three years, commencing initially on or about September 15, 2006, which date has been verbally extended to the date on which PPT has obtained the necessary building permit for its first plant in Nuevo Laredo, Mexico, and has secured sufficient financing to commence construction of the plant. PPT has obtained the building permit for the first plant, but has not secured sufficient financing to commence construction.  Upon commencement of the construction of the first plant PPT will become obligated to pay Titan an initial installment of $300,000 of the remaining $900,000 for the license fee for the first plant.  The Agreement also calls for a $200,000 payment for the exclusive license, for PPT to utilize Titan's tire recycling technology in Mexico, which amount has been previously received, as stated above.

The Mexican License provides for a $1,000,000 license fee for each plant, payable as follows: (i) a deposit of $100,000 paid by April 30, 2006; (ii) $300,000 payable upon commencement of construction; (iii) $300,000 upon completion of construction; and (iv) $300,000 upon reaching full capacity.  During the year ended July 31, 2006, PPT and its predecessor paid Titan $320,000, and PPT received credit for the $180,000 previously paid by its predecessor. Therefore, the total initial $500,000 requirement, including the $300,000 deposit for the first three plants as well as $200,000 for the exclusive license for the Republic of Mexico, has been satisfied. An additional $50,000 was received during the fiscal year ended July 31, 2007.  Since construction has not yet commenced, the entire deposit is presented as deferred revenue at April 30, 2008.

The Mexican License further provides that Licensee will pay Titan royalty payments equal to $4.00 per ton of tires processed in the recycling plants in Mexico after full capacity is reached.  Failure by PPT to make the required royalty payments for first three plants could result in Titan terminating the License Agreement and loss of the exclusive license for Mexico and all monies paid to date by PPT and its predecessor.

Additionally, Titan has agreed to purchase a seven percent (7%) ownership interest in PPT for $100,000, of which $75,000 was paid during fiscal 2005 pursuant to previous agreements that were subsequently deemed void.  Titan has been given credit for its previous payments, towards the purchase of its investment in PPT.  Since PPT is in the organizational stages, the final $25,000 paid in fiscal 2006 is presented as a deposit at April 30, 2008.

Effective August 23, 2006, the Company entered into another licensing agreement with an unrelated investor group, Ally Investment, LLP (“Ally”), for the use of Titan's recycling patents and technology within the states of Texas, Louisiana, Mississippi and Oklahoma, and received a non-refundable deposit in the amount of $100,000, which amount is included in deferred revenue at April 30, 2008. The licensing fee agreement provided for a licensing fee for each plant of $1,600,000 upon securing both a construction site and construction financing, and production royalties of 1.5% of gross revenues derived from the sale of all products generated using Titan technology, upon reaching full capacity.

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Titan Technologies, Inc.

Notes to Financial Statements

April 30, 2008

(Unaudited)

On December 12, 2007, the Company and Ally entered into a Second Amendment to License Agreement that modified the original License Agreement in the following respects:

1.   The Territory was expanded from the four states to the entire United States.

2.   The license fee of $1,600,000 and the royalty payment of 1.5% of all products produced was amended to a Ten (10%) percent membership interest in each of the single purpose entities formed to own and operate each plant beyond the first plant (the second and each subsequent plant).

3.   The obligation to pay the initial license fee for the first plant of $1,600,000 remains unchanged, but the obligation to commence construction of the first plant, as amended on February 23, 2007, to commence, on or before December 31, 2007, and be in operation, no later that December 31, 2008 was modified to require that construction of the first plant commence when (i) government agencies have granted construction approval and (ii) Ally has obtained financing to build the first plant. As of April 30, 2008 construction had not commenced.

4.   The termination of the Exclusive License was  also modified to provide that the exclusive license for the U.S. will terminate if Ally should fail to commence to obtain a permit and prepare a feasibility study for the next plant within twelve (12) months after the previous plant has reached full capacity.

Also on December 12, 2007, the Registrant and Ally Investment entered into a Memorandum of Understanding regarding Plastics Scrap, including but not limited to the following terms:

1.   The grant of an exclusive license for Titan's Technology and patents for the recycling of scrap electronics throughout the United States.

2.   A license fee of $500,000 each to the Registrant and Adherent Technologies, upon Ally securing sufficient funding and government approvals to commence construction of the first plastics recycling plant.

3.   The grant to the Registrant of a ten (10%) percent ownership in each entity established to own and operate a plastics recycling plant anywhere in the U.S.

4.   A research and development time table for testing a sample of constituent materials and development of a plastics recycling plant in the U.S.

5.   A commitment by Ally to fund and commence construction of the first plastics recycling plant in the U.S. within four years after delivery of the first sample of test material by Ally to Titan.

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Titan Technologies, Inc.

Notes to Financial Statements

April 30, 2008

(Unaudited)

Note 6.  Related Party Transactions

In December 2007, an employee advanced $5,000 to the Company.  The advance was due on demand, non-interest bearing and was repaid in January 2008.

Note 7.  Subsequent Events

Subsequent to April 30, 2008, The Company sold 190,000 shares of common stock for cash proceeds of $19,000.

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ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Results of Operations

As a result of activities by management, general and administrative expense increased $8,539 to $68,785 for the three months ended April 30, 2008 compared to the three months ended April 30, 2007, primarily due to the increase in travel, rent and salaries.

As a result of activities by management, general and administrative expense increased $11,774 to $209,243 for the nine months ended April 30, 2008 compared to the nine months ended April 30, 2007, primarily due to the increase in legal and accounting.

As a result of activities of management, outside services expense decreased $1,170 to $425 for the three months ended April 30, 2008 compared to the three months ended April 30, 2007.

As a result of activities of management, outside services expense decreased $8,718 to $4,706 for the nine months ended April 30, 2008 compared to the nine months ended April 30, 2007.

As a result of activities of management, stock compensation expense decreased $24,309 to zero during the nine months ended April 30, 2008 compared to the nine months ended April 30, 2007.

 Financial Condition

The Company's liquidity decreased in the nine months ended April 30, 2008 as cash decreased $15,006 since July 31, 2007.  Operations used $212,280 compared to the same period of the prior year in which operations used $79 374.  Proceeds from the sale of common stock were $197,274 during the nine months ended April 30, 2008 compared to $71,000 for the same period in 2007.

Future financing activities of the Company include primarily the sale of common stock.  The Company does not solicit purchasers of its common stock but believes past experience demonstrates that there will be sufficient unsolicited purchases of common stock to sustain the Company's cash flow needs, especially in light of the expected revenue form licensing activities in the future.

Management has taken the following steps in the past and will consider taking them again, if necessary, to address the financial and operating condition of the Company which it believes will be sufficient to provide the Company with the ability to continue in existence:

Improve marketing efforts for recycling plants and bring plastics recycling technology and coal gasification to a marketable product.

Reduce operating and administrative expenses, and issue stock and notes payable, where possible for payment of expenses.

Defer payment of officer’s salaries, if required.

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Management believes that these steps, if taken, will allow the Registrant to continue as a going concern together with results of on going efforts to raise working capital through licensing agreements, and joint ventures.  However, there are significant risks associated with the Registrant's business development and there can be no assurance that its efforts will be successful or that it will be able to raise sufficient working capital to survive as a going concern.

ITEM 3.  CONTROLS AND PROCEDURES

(a)  Evaluation of Disclosure Controls and Procedures.

The company maintains controls and procedures designed to ensure that information required to be disclosed in this report is recorded, processed, accumulated and reported to management, including the principal executive and financial officer to allow timely decisions regarding the required disclosure.

As of the end of the period covered by this report, Company's management, with the participation of its principal executive and financial officer, performed an evaluation of the effectiveness of the design and operation of these disclosures controls and procedures. The principal executive and financial officer have concluded that such disclosure controls and procedures are effective in ensuring that required information is disclosed in the Company's

reports.

(b)  Changes in Internal Controls.

There were no significant changes in the Company's internal controls or in other factors that could significantly affect these controls subsequent to the evaluation date.

PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

None

Item 2.  Changes in Securities

During the nine months ended April 30, 2008, the Company sold common stock to seventeen investors.  The following table illustrates the dates of the transactions, the number of shares and the proceeds of the sale.

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Date	Shares Issued		Cash Received
9/04/07		150,000	$	15,000
9/24/07		43,938		4,394
10/15/07		6,000		600
10/17/07		5,000		500
10/22/07		40,000		4,000
10/25/07		70,000		7,000
11/05/07		250,000		25,000
12/03/07		100,000		10,000
12/07/07		70,000		7,000
12/12/07		20,000		2,000
12/18/07		25,000		2,500
12/14/07		25,000		2,500
12/18/07		250,000		25,000
1/14/08		300,000		36,000
2/15/08		300,000		36,000
4/01/08		31,500		3,780
4/11/08		60,000		6,000
4/19/08		100,000		10,000
		1,846 ,438	$	197,274

We relied on Section 4(2) of the Securities Act of 1933 for exemption from the registration requirements of the Securities Act.  Each investor was furnished with information concerning our formation and operations, and had the opportunity to verify the information supplied and ask questions of Management.  Additionally, we obtained a representation from each of the acquiring persons representing their intent to acquire the securities for the purpose of investment only, and not with a view toward the subsequent distribution thereof.  Each of the certificates representing the common stock carries a legend restricting transfer of the securities represented.

Item 3. Defaults in Senior Securities

None

Item 4.  Submission of Matters to a Vote of Security Holders

None

Item 5.  Other Information

None

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Item 6.  Exhibits and Reports on Form 8-K

(a)   Exhibits:  The following exhibits are filed with this report:

31.1  Certification pursuant to Rule 13(a) of 15d-14(a) under the Securities Exchange Act of 1934 as amended.

32   Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002.

(b)   Reports on Form 8-K.  State whether any reports on Form 8-K have been filed during the quarter for which this report is filed, listing the itemsreported, any financial statements files, and the dates of any such reports.

The following exhibit was filed as an exhibit to Registrant's Current Report onForm 8-K dated December 21, 2007.

10.24   Second Amendment to License Agreement dated December 12, 2007, between the Registrant and Ally Investments, LLP, a Texas limited liability partnership

10.25   Memorandum of Understanding related to Scrap Electronics dated December 12, 2007 between the Registrant and Ally Investments, LLP a Texas limited liability partnership

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SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	TITAN TECHNOLOGIES, INC.
Date:  June 16, 2008	By:	/s/  /s/ Ronald L. Wilder, President
		Ronald L. Wilder, President, Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer.

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