ECO SCIENCE SOLUTIONS, INC. - Quarter Report: 2016 July (Form 10-Q)

---

---

Nevada	46-4199032
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1135 Makawao Avenue, Suite 103-188, Makawao, Hawaii	96768
(Address of principal executive offices)	(Zip Code)
Registrant's telephone number:	(800) 379-0226

Yes [X]  No [  ]

Yes [X] No [  ]

Large accelerated filer	[  ]	Accelerated filer	[  ]
Non-accelerated filer	[  ]	Smaller reporting company	[X]
(Do not check if a smaller reporting company)

		Page
	PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	8
Item 4.	Controls and Procedures	8
	PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	9
Item 1A.	Risk Factors	9
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	9
Item 3.	Defaults Upon Senior Securities	9
Item 4.	Mine Safety Disclosures	9
Item 5.	Other Information	9
Item 6.	Exhibits	10
	SIGNATURES	11

	Page
Unaudited Balance Sheets as of July 31, 2016 and January 31, 2016	F-1
Unaudited Statements of Operations for the six months ended July 31, 2016 and 2015	F-2
Unaudited Statement of Cash Flows for the six months ended July 31, 2016 and 2015	F-3
Notes to the Unaudited Financial Statements	F-4 to F-12

ECO SCIENCE SOLUTIONS, INC.
BALANCE SHEETS
		July 31, 2016 (Unaudited)				January 31, 2016
ASSETS
Current assets
Cash		$	60			$	6,706
Prepaid expenses			817				-
Total current assets			877				6,706
Property and equipment, net			2,011				-
TOTAL ASSETS		$	2,888			$	6,706
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable and accrued expenses		$	115,462			$	67,173
Related party payable			157,941				18,333
Notes payable, short-term, related party			30,000				-
Note payable			42,490				-
Notes payable, convertible			136,350				232,450
Notes payable, short-term, related party, convertible			251,045				251,045
Liabilities for allocated and unissued shares			1,351,011				147,510
Total current liabilities			2,084,299				716,511
Long term liabilities
Notes payable-convertible-related party, net of unamortized discount			50,400				46,710
Total long term liabilities			50,400				46,710
Total liabilities			2,134,699				763,221
Stockholders' deficit
Preferred stock, $.001 par, 50,000,000 shares authorized, none issued and outstanding at January 31, 2016 and January 31, 2015, respectively			-				-
Common stock, $0.0001 par, 650,000,000 shares authorized, 31,498,233 shares issued and 30,498,233 outstanding at July 31, 2016 and 28,226,349 issued and outstanding at January 31, 2016			3,150				2,822
Treasury stock (1,000,000 shares issued at a cost of $0.0075 per share)			(7,500	)			-
Additional paid in capital, common, and deferred compensation			9,279,777				9,133,256
Accumulated deficit			(11,407,238	)			(9,892,593	)
Total stockholders' deficit			(2,131,811	)			(756,515	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT		$	2,888			$	6,706

ECO SCIENCE SOLUTIONS, INC.
INCOME STATEMENT
(Unaudited)
		For the three months ended July 31,								For the six months ended July 31,
		2016				2015				2016				2015
Revenue		$	-			$	-			$	-			$	-
Cost of revenues			-				-				-				-
Gross profit			-				-				-				-
Depreciation			188								251				-
Legal, accounting and audit fees			47,423				3,500				58,214				9,502
Management and consulting fees			68,512				10,300				147,767				14,800
Research, development, and promotion			69,500				-				174,500				-
Transfer agent and filing fees			1,015				110				2,410				1,746
Office supplies and other general expenses			29,146				4,592				43,202				6,483
Advertising and marketing			412,786				-				691,309				-
Amortization of stock options			-				151,250				-				302,500
Net operating loss			628,570				169,752				1,117,653				335,031
Net operating loss			(628,570	)			(169,752	)			(1,117,653	)			(335,031	)
Other income (expenses)
Interest expense			(8,257	)			(6,045	)			(17,567	)			(11,771	)
Loss on shares issued for services and fees			(217,267	)			-				(379,425	)			-
Total other income (expenses)			(225,524	)			(6,045	)			(396,992	)			(11,771	)
Net loss		$	(854,094	)		$	(175,797	)		$	(1,514,645	)		$	(346,802	)
Net loss per common share - basic and diluted		$	(0.03	)		$	(0.01	)		$	(0.05	)		$	(0.01	)
Weighted average common shares outstanding - basic and diluted			30,200,712				30,936,479				29,041,411				30,855,708

ECO SCIENCE SOLUTIONS, INC.
STATEMENTS OF CASH FLOWS (Unaudited)
		For the six months ended July 31,
		2016				2015
Cash flows from operating activities:
Net loss		$	(1,514,645	)		$	(346,802	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation			251				-
Loss on shares issued for services and fees			379,425				-
Stock based compensation			25,000				302,500
Amortization of debt discount			3,690				-
Liabilities from unissued shares			849,826				-
Changes in operating assets and liabilities:
Prepaid expenses			(817	)
Increase (decrease) in accounts payable and accrued expenses			48,289				12,753
Increase (decrease) in related party payables			139,608				(3,000	)
Net cash used in operating activities			(69,373	)			(34,549	)
Cash Flows from Investing Activities:
Purchase equipment			(2,263	)			-
Net cash used in investing activities			(2,263	)			-
Cash flows from financing activities:
Proceeds from related party loans			35,000				30,000
Repayment to related party loans			(5,000	)			-
Subscription received			-				250
Note payable			42,490				-
Repurchase of common shares			(7,500	)			-
Net cash provided by financing activities			64,990				30,250
Net decrease in cash			(6,646	)			(4,299	)
Cash-beginning of period			6,706				13,322
Cash-end of period		$	60			$	9,023
NON-CASH ACTIVITIES
Shares issued for services and fees		$	25,750			$	-
SUPPLEMENTAL DISCLOSURES
Interest paid		$	-			$	-
Income taxes paid		$	-			$	-

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Level 1:	Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
Level 2:	Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level 3:	Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

Cost		$	2,262
Accumulated Depreciation			(251	)
Balance, July 31, 2016		$	2.011

(1)	SDOI will not be issued Series A Preferred Stock initially equal to the current total authorized common shares outstanding of 650,000,000;
(2)	Invoices for advertising services billed separately from the $35,000 standard monthly fee will have the same terms as the monthly fee; i.e., the amount invoiced will be paid via the issuance of S-8 shares of ESSI Common Stock (issued at a 30% discount to the market VWAP on the date of payment due or a share price of $0.01, whichever is greater).

		July 31, 2016				January 31, 2016
Office lease – Security deposits		$	817			$	-
Total prepaid expense		$	817			$	-

		Note 1				Note 2				Note 3				Total
Balance, January 31, 2016		$	232,450			$	-			$	-			$	232,450
Changes:
Converted to shares			(96,100	)			-				-				(96,100	)
Additions			-				27,560				14,930				42,490
Balance, July 31, 2016		$	136,350			$	27,560			$	14,930			$	178,840

NOTE 7: RELATED PARTY TRANSACTIONS

		July 31, 2016				January 31, 2016
Related party payable compensation (2)		$	157,941			$	18,333
Notes payable (4)			30,000				-
Convertible notes payable for cash proceeds received (1)			251,045				251,045
Convertible notes payable for unpaid compensation (3)			59,000				59,000
Less: unamortized discount (3)			(8,600	)			(12,290	)
Total convertible notes payable, net of unamortized discount			301,445				297,755
Total related party loans			334,600				297,755
Total related party transactions		$	489,386			$	316,088

Description		Principal				Interest Rate			Conversion Rate	Maturity Date
Note Payable (1)		$	251,045				5%		FMV	On demand with 90 days written notice
Note Payable (3)		$	59,000				6%		80% of FMV	10/01/2017
Less: unamortized discount (3)			(8,600	)
Note Payable, net of unamortized discount		$	50,400

(1)

As of July 31, 2016 and January 31, 2016, a company controlled by the Company’s former Chairman of the Board was due a principal balance of $251,045  in respect to a demand convertible note payable.   During the six months ended July 31, 2016 the Company has accrued $6,259 with respect to the aforementioned note payable.

(2)

Effective December 17, 2015, Mr. Jeffery Taylor was appointed to serve as Chief Executive Officer of the Company and Mr. Don Lee Taylor was appointed to serve as Chief Financial Officer of the Company. On December 21, 2015 the Company entered into employment agreements with Mr. Jeffery Taylor and Mr. Don Lee Taylor for a period of 24 months, where after the contract may be renewed in one year terms at the election of both parties.  Jeffery Taylor shall receive an annual gross salary of $115,000 and Don Lee Taylor shall receive an annual gross salary of $105,000 payable in equal installments on the last day of each calendar month and which may be accrued until such time as the Company has sufficient cash flow to settle amounts payable.  Further under the terms of the respective agreements all inventions, innovations, improvements, know-how, plans, development, methods, designs, analyses, specifications, software, drawings, reports and all similar or related information (whether or not patentable or reduced to practice) which relate to any of the Company’s actual or proposed business activities and which are created, designed or conceived, developed or made by the Executive during the Executive’s past or future employment by the Company or any Affiliates, or any predecessor thereof (“Work Product”), belong to the Company, or its Affiliates, as applicable.   During the six months ended July 31, 2016 the Company accrued management fees in the amount of $57,500 to Mr. Jeffery Taylor and $52,500 to Mr. Don Lee Taylor.   During the six months ended July 31, 2016 the Company reimbursed a total of $10,229 to Mr. Jeffery Taylor and $19,226 to Mr. Don Lee Taylor.   As of July 31, 2016, there remained a total of  $157,788 on the balance sheets as related party accounts payable ($18,333 – January 31, 2016).

NOTE 7: RELATED PARTY TRANSACTIONS (cont’d)

(3)

On October 1, 2015 the Company issued its former President a convertible promissory note in the principal amount of $59,000 for unpaid compensation.  The note bears interest at a rate of 6% per annum, matures on October 1, 2017, and contains a repayment provision which permits the holder to convert the debt into the Company's common stock at a rate of 80% of the fair market value of the common stock on the date of conversion.  The conversion discount of 20% of FMV results in a beneficial conversion feature.  As a result, the difference between the conversion rate and the market rate of $14,750 on the date of the transaction has been classified as a discount on the note.  As of July 31, 2016, the Company expensed $3,690 as amortization of the debt discount which is included as interest expense.  As of July 31, 2016, $8,600 of unamortized discount remains, and will be amortized over the next 14 months.

(4)

On February 17, 2016 the Company issued promissory notes to Mr. Jeffery Taylor, CEO, in the amount of $17,500 and to Mr. Don Lee Taylor, CFO, in the amount of $17,500, respectively. The notes bear interest at a rate of 1% per annum, maturing on August 17, 2016. During the six month period ended July 31, 2016, the company repaid $2,500 to Mr. Jeffery Taylor and $2,500 to Mr. Don Lee Taylor.   As of July 31, 2016, the Company has accrued $153 as interest with respect to the above notes.

Options Activity						Weighted
		Number				Average
		of Shares				Exercise Price
Outstanding at January 31, 2016			6,500,000			$	0.20
Issued			-				-
Exercised			-				-
Expired / Cancelled			(6,500,000)				0.20
Outstanding at July 31, 2016			-			$	-

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

		For the three months ended
		July 31, 2016				July 31, 2015
Depreciation		$	188			$	-
General and administrative expenses			215,596				18,502
Advertising and marketing			412,786				-
Amortization of stock options			-				151,250
Net operating loss			(628,570	)			(169,752	)
Other income (expenses)
Interest expense			(8,257	)			(6,045	)
Loss on shares issued for services and fees			(217,267	)			-
Total other income (expenses)			(225,524	)			(6,045	)
Net loss		$	(854,094	)			(175,797	)

		For the three months ended July 31,
		2016				2015				Variances
Legal, accounting and audit fees		$	47,423			$	3,500			$	43,923
Management and consulting fees			68,512				10,300				58,212
Research, development, and promotion			69,500				-				69,500
Transfer agent and filing fees			1,015				110				905
Office supplies and other general expenses			29,146				4,592				24,554
Total general and administrative expenses		$	215,596			$	18,502			$	609,880

		For the six months ended
		July 31, 2016				July 31, 2015
Depreciation		$	251			$	-
General and administrative expenses			426,093				32,531
Advertising and marketing			691,309				-
Amortization of stock options			-				302,500
Net operating loss			(1,117,653	)			(335,031	)
Other income (expenses)
Interest expense			(17,567	)			(11,771	)
Loss on shares issued for services and fees			(379,425	)			-
Total other income (expenses)			(396,992	)			(11,771	)
Net loss		$	(1,514,645	)			(346,802	)

		For the six months ended July 31,
		2016				2015				Variances
Legal, accounting and audit fees		$	58,214			$	9,502			$	48,712
Management and consulting fees			147,767				14,800				132,967
Research, development, and promotion			174,500				-				174,500
Transfer agent and filing fees			2,410				1,746				664
Office supplies and other general expenses			43,202				6,483				36,719
Total general and administrative expenses		$	426,093			$	32,531			$	1,084,871

ITEM 1.

LEGAL PROCEEDINGS

ITEM 1A.

RISK FACTORS

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

ITEM 4.

MINE SAFETY STANDARDS

ITEM 5.

OTHER INFORMATION

 

Exhibit Number	Exhibit Description	Filed Previously	Filed herewith
3.1	Articles of Incorporation of Pristine Solutions Inc. (incorporated by reference to the Registrant’s registration statement on Form S-1 filed on May 4, 2010)	*
3.2	Certificate of Amendment filed with the Nevada Secretary of State on January 29, 2010. (incorporated by reference to the Registrant’s registration statement on Form S-1 filed on May 4, 2010)	*
3.3	Bylaws of Pristine Solutions Inc. (incorporated by reference to the Registrant’s registration statement on Form S-1 filed on May 4, 2010)	*
3.4	Amended Articles of Incorporation/Certificate of Amendment filed with the Nevada Secretary of State on March 7, 2012 (incorporated by reference to the Registrant’s Annual Report on Form 10-K for the year ended January 31, 2012 filed July 31, 2012)	*
3.5	Articles of Exchange filed with the Nevada Secretary of State on October 31, 2012 (incorporated by reference to the Registrant’s Current Report on Form 8-K filed November 13, 2012)	*
3.6	Certificate to accompany Restated Articles or Amended and Restated Articles  (incorporated by reference to the Registrant’s Current Report on Form 8-K filed January 3, 2013)	*
3.7	Certificate of Amendment to Articles of Incorporation for Nevada Profit Corporations (incorporated by reference to the Registrant’s Current Report on Form 8-K filed February 18, 2014)	*
3.8	Designation of Series A Voting Preferred shares filed with the Nevada Secretary of State on January 12, 2016	*
10.1	Employment Agreement between the Company and Mike Borkowski dated November 1, 2015	*
10.2	December 21, 2015 employment agreement between the Company and Jeffery Taylor	*
10.3	December 21, 2015 employment agreement between the Company and Don Lee Taylor	*
10.4	Technology licensing and marketing support agreement between Separation Degrees – One, Inc. (“SDOI”) and the Company dated January 1, 2016	*
10.5	Asset purchase agreement between the Company and Separation Degrees – One, Inc. (“SDOI”) dated January 4, 2016	*
10.6	Amendment No. 1 to the Technology licensing and marketing support agreement between Separation Degrees – One, Inc. (“SDOI”)	*
10.7	Amendment No. 2 to the Technology licensing and marketing support agreement between Separation Degrees – One, Inc. (“SDOI”)	*
(31)	Rule 13a-14(a)/15d-14(a) Certifications
31.1	Certification of our Chief Executive Officer pursuant to Rule 13(a)-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended		*
31.2	Certification of our Chief Financial Officer pursuant to Rule 13(a)-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended		*
(32)	Section 1350 Certifications
32.1	Certification of our Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002		*
32.2	Certification of our Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002		*
(101)	Interactive Data Files
101.INS	XBRL Instance Document		*
101.SCH	XBRL Taxonomy Extension Schema Document		*
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document		*
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document		*
101.LAB	XBRL Taxonomy Extension Label Linkbase Document		*
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document		*

	ECO SCIENCE SOLUTIONS, INC.
Dated: September 19, 2016	/s/ Jeffery Taylor
	Jeffery Taylor
	President, Chief Executive Officer, Secretary and Director