Titan 10-Q 2009 Q1 Quarterly report

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[XX]	QUARTERLY REPORT PURSUANT TO SECTION13 OR15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended			October 31, 2008
or
[   ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934
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 of incorporation or organization)	(IRS Employer Identification No.)
3206 Candelaria Road NE, Albuquerque, NM 87107
(Address of principal executive offices)                                                                                                                       Zip Code
(505) 884-0272
(Issuer's telephone number, including area code)
N/A
(Former name, former address, and former three-months, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 of 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.    Yes    X     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 definitions of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	Accelerated filer
Non-accelerated filer	Smaller reporting company	X

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant filed all documents and reports required to be filed by Section 12,13, or 15 (d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
	Yes        No
SEC 1296 (02-08) Potential persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate  the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: December 12, 2008 No par common 48,353,777.

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Titan Technologies, Inc.

Index to Quarterly Report on Form 10-Q

		Page
Cautionary Statement on Forward-Looking Statements		3
Part I.  FINANCIAL INFORMATION
Item 1.	Condensed Balance Sheets at October 31, 2008 (unaudited) and July 31, 2008	4
	Condensed Statements of Operations for the three months ended October 31, 2008	5
	and 2007  (unaudited)
	Condensed Statements of Cash Flows for the three months ended October 31, 2008	6
	and 2007 (unaudited)
	Notes to Condensed Financial Statements (unaudited)	7
Item 2.	Management's Discussion and Analysis of Financial Conditions and Results of	11
	Operations
Item 3.	Quantitative and Qualitative Disclosures About Market Risks	12
Item 4T.	Controls and Procedures	12
Part II.  OTHER INFORMATION
Item 1.	Legal Proceedings	13
Item 2.	Unregistered Sales of Equity Securities and use of Proceeds	13
Item 3.	Defaults Upon Senior securities	13
Item 4.	Submission of Matters to A Vote of Security Holders	13
Item 5.	Other Information	13
Item 6.	Exhibits and Reports on Form 8-K	14
Signatures		14

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Titan Technologies, Inc.

Cautionary Statement on Forward-Looking Statements

The discussion n the Report on Form 10-Q, including the discussion in Item 2 of PART 1, contains forward- looking statements that have been made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995.  Such forward-looking statements are based on current expectations, estimates and projections about the Company's business, based on management's current beliefs and assumptions made by management.  Words such as "expects", "anticipates", "intends", "believes", "plans", "seeks", "estimates", and similar expressions or variations of these words are intended to identify such forward-looking statements.  Additionally, statements that refer to the Company's estimated or anticipated future results, sales or marketing strategies, new product development or performance or other non-historical facts are forward-looking and reflect the Company's current perspective based on existing information.  These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict.  Therefore, actual results and outcomes may differ materially from what is expressed or forecasted in any such  forward-looking statements.  Such risks, and uncertainties include those set forth below in Item 1 as well as  previous public filings with the Securities and Exchange Commission.  The discussion of the company's financial condition and results of operations included in Item 2 of PART 1 should also be read in conjunction with the financial statements and related notes included in Item 1 of PART 1 of this quarterly report. These quarterly financial statements do not include all disclosures provided in the annual financial statements and should be read in conjunction with the "Risk Factors" and annual financial statements and noted thereto included in the Company's Form 10-KSB for the year ended July 31, 2008 as filed with the Commission on November 14, 2008.  The company undertakes no obligation to update publicly any forward-looking statement, whether as a result of new information, future events or otherwise.

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PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements.

Titan Technologies, Inc.

BALANCE SHEETS

ASSETS
	October 31, 2008
	(unaudited)			July 31, 2008
Current Assets
Cash	$	24,234		$	4,461
Other Assets		25,609			25,609
	$	49,843		$	30,070
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Current Liabilities
Accounts payable and accrued expenses	$	54,792		$	14,752
Deferred revenue		420,000			470,000
Total Current Liabilities		474,792			484,752
Stockholders' (Deficit)
Common stock - no par value; authorized, 50,000,000 shares;
48,370,777 shares issued, 48,353,777 shares outstanding		4,162,014			4,147,014
Treasury stock, 17,000 shares, at cost		-			-
Accumulated (deficit)		(4,586,963	)		(4,601,696	)
		(424,949	)		(454,682	)
	$	49,843		$	30,070

See the accompanying notes to the financial statements.

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Titan Technologies, Inc.

STATEMENTS OF OPERATIONS

For The Three Months Ended October 31, 2008 and 2007

(UNAUDITED)

	2008		2007
REVENUES	$	100,000	$	-
COSTS AND EXPENSES
General and administrative		64,418		64,119
Outside services		20,850		-
Depreciation		-		26
		85,268		64,145
Income (Loss) from operations		14,732		(64,145	)
Provision for income taxes		-		-
Net income (loss)	$	14,732	$	(64,145	)
Weighted average common shares outstanding -
Basic and diluted		48,251,179		46,088,325
Basic and diluted income (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 CASH FLOWS

For The Three Months Ended October 31, 2008 and 2007

(UNAUDITED)

	2008		2007
Cash flows from operating activities
Net cash provided  by (used in) operating activities	$	4,773	$	(52,024	)
Cash flows from investing activities
Net cash provided by investing activities		-		-
Cash flows from financing activities
Proceeds from the sale of common stock		15,000		31,494
Net cash provided by financing activities		15,000		31,494
Net increase (decrease) in cash		19,773		(20,530	)
Cash at beginning of period		4,461		30,583
Cash at end of period	$	24,234	$	10,053

See the accompanying notes to the financial statements.

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Titan Technologies, Inc.

Notes to Condensed Financial Statements

October 31, 2008

(Unaudited)

Note 1.  Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial information and Rule 8.03 of Regulation S-X. They do not include all of the information and footnotes required by GAAP 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.

The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year. For further information, refer to the financial statements of the Company included in the Company’s Form 10-KSB for the year ended July 31, 2008 as filed with the Commission on November 14, 2008.

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. As of October 31, 2008 the Company had working capital and stockholders' deficits of ($450,558) and ($424,949), respectively, at October 31, 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 Condensed Financial Statements

October 31, 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 three months ended October 31, 2008, the Company sold 187,500 shares of common stock for cash proceeds aggregating $15,000.

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 October 31, 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 Shares		Weighted Average Exercise Price
Outstanding at July 31, 2008		1,050,000	$	0.12
Granted		-		-
Exercised		-		-
Forfeited		-		-
Outstanding at October 31, 2008		1,050,000	$	0.12

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Titan Technologies, Inc.

Notes to Condensed Financial Statements

October 31, 2008

(Unaudited)

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.

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.  Another $50,000 was received during the quarter ended October 31, 2008, which is included in deferred revenue.  Since construction has not yet commenced, the balance of the deposit of $420,000 is presented as deferred revenue at October 31, 2008.

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Titan Technologies, Inc.

Notes to Condensed Financial Statements

October 31, 2008

(Unaudited)

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 October 31, 2008 and is included in other assets in the accompanying financial statements.

A prior agreement entered into with Ally Investment, LLP (“Ally”) has been terminated for lack of performance on the part of Ally.  The deposit of $100,000 previously reported as deferred income has now been recognized as income.

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

Introduction

The following narrative describes the financial condition of Titan Technologies, Inc.  (“we”, “our” or the “Company”) at October 31, 2008 and compares it to our financial conditions at fiscal year end July 31, 2008.  It also discusses our results of operations for the three months ended October 31, 2008 and October 31, 2007.  This discussion and analysis should be read in conjunction with the information contained in our annual report on Form 10-KSB for the fiscal year ended July 31, 2008, including the audited financial statements and notes included therein.  The financial statements included in this report, including our balance sheet at October 31, 2008, the statements of income for the three months ended October 31, 2008 and 2007 and our statements of cash flows for the three months ended October 31, 2008 and 2007 are unaudited.

Results of Operations

As a result of activities by management, general and administrative expense increased $273 to $64,418 for the three months ended October 31, 2008 compared to the three months ended October 31, 2007.

As a result of activities by management, outside services expenses, constituting consulting fees paid to an affiliate of the Company’s Mexican franchisee, increased $20,850 to $20,850 for the three months ended October 31, 2008 compared to the three months ended October 31, 2007.

Liquidity and Capital Resources

The Company's liquidity increased in the three months ended October 31, 2008, as cash increased $19,773 since July 31, 2008.  Operations provided $4,773 compared to the same period of the prior year in which operations used $52,024.  Proceeds from the sale of common stock were $15,000 during the three months ended October 31, 2008 compared to $31,494 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.   QUANTITATIVE  AND QUALIITATIAVE DISCLOSURES ABOUT MARKET RISKS

Not applicable

ITEM 4T.  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.

This report does not include an attestation report of the company’s registered public accounting  firm regarding internal control over financial reporting.  Management’s report was not subject to attestation by the company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management’s report in this report.

(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.

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PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

None.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

During the three months ended October 31, 2008, the Company sold common stock to three investors.  The following table illustrates the dates of the transactions, the number of shares and the proceeds of the sale.

Date	Shares Issued		Cash Received
9/08/08		125,000	$	10,000
10/01/08		62,500		5,000
		187,500	$	15,000

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 Upon Senior Securities

None

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

None

Item 5.  Other Information

None

Item 6.  Exhibits and Reports on Form 8-K

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

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31.1 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for Ronald L. Wilder dated December 19, 2008.

32.1 Certification pursuant to Section 906 of the Sarbanes Oxley Act of 2002 for Ronald L. Wilder, dated December 19, 2008.

(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.

None

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act of 1934 the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	TITAN TECHNOLOGIES, INC.              (Registrant)
Date:  December 22, 2008	By:	/s/ Ronald L. Wilder
		Ronald L. Wilder, President, Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer.

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