Tire Recycler Inks Deal

Titan Technologies Inc. and United States Recycling, LLC signed an agreement and licensing Agreement that both companies are confident will result in the first U.S. plant using Titan's tire recycling technology. USR is a privately held company based in Florida that has been working on the project for more than a year. The first plant is planned for Bay City, Texas.

Under the terms of the Agreement, Titan will be paid $10,000 per month for six months, beginning on signing of the Agreements, which will be credited towards a total license fee of $1 million payable as follows: $190,000 upon completion of financing, $175,000 upon commencement of construction, $175,000 upon plant commissioning and $400,000, payable $100,000 every six months following commencement of positive cash flow. After achieving positive cash flow, Titan will also be paid a production royalty of $4.00 per ton of tires processed.

The agreement also provides that financing must be completed by January 31, 2004.

Elan Sassoon, CEO of USR, said his team had been working diligently on the financial arrangements as currently planned for more than six months and expressed optimism that USR would have all financing in place well before this date and be well into construction.

Dick McWilliams, USR’s president, said that, "We certainly would not have expended all the time, effort and money on this project unless we were highly confident that it will be a complete success."

The Agreement and License Agreement initially are exclusive to and cover Texas, as well as Austria and Brazil. If USR completes financing and the first plant is under construction by January 31, 2004, USR has the right to obtain additional licenses for subsequent plants on terms similar to those for the first plant, although payment of the $1 million license fee is somewhat more accelerated for subsequent plants.

The current estimated capital cost for the first plant is in the range of $15 million, including a circuit for production of activated carbon, working capital and all ancillary facilities except shredders with the expectation that tires will be shredded by the tire supplier. The estimated capacity of the plant is 100-135 tons of tires per day, which equates to between 3,000 and 4,000 tons of tires per month.