UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

x
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarter ended June 30, 2008
   
¨
TRANSITION REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from _______to_______

Commission File No. 000-19566

EARTH SEARCH SCIENCES, INC.
(Exact Name of Registrant as Specified in its Charter)


Nevada
87-0437723
(State or other Jurisdiction of
(IRS Employer
Incorporation or Organization)
Identification Number)


306 Stoner Loop Road, Lakeside, MT 59922
(Address of Principal Executive Offices, Including Zip Code)

Registrant's telephone number, including area code:     (406) 751-5200


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, and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by a check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
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 of the Exchange Act).  Yes ¨ No x

Number of shares of common stock outstanding at August 7, 2008: 143,344,901

 
 
 

EARTH SEARCH SCIENCES, INC.

TABLE OF CONTENTS

FORM 10-Q

QUARTER ENDED JUNE 30, 2008

PART I

FINANCIAL INFORMATION


Item 1. Consolidated Financial Statements (Unaudited)
Page
     
 
Consolidated Balance Sheets as of June 30, 2008 and March 31, 2008
3
     
 
Consolidated Statements of Operations for the three months ended
June 30, 2008 and 2007
4
     
 
Consolidated Statements of Cash Flows for the three months ended
June 30, 2008 and 2007
5
     
 
Consolidated Statement of Changes in Stockholders’ Deficit for the three months ended June 30, 2008
6
     
 
Selected notes to consolidated financial statements
7
     
Item 2. Management's Discussion and Analysis of
  Financial Condition and Results of Operations
9-11
     
Item 3. Quantitative and Qualitative Disclosures About Market Risk
11
   
Item 4T. Controls and Procedures
12


PART II

OTHER INFORMATION REQUIRED

Item 1. Legal Proceedings
13
Item 1A. Risk Factors
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 of a Vote of Security Holders
13
Item 5. Other information
13
Item 6. Exhibits
13


 
2
 

EARTH SEARCH SCIENCES, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

   
June 30,
2008
   
March 31,
2008
 
             
ASSETS
           
Current assets:
           
Cash
 
$
20,434
   
$
8,821
 
Loan costs, net of accumulated amortization of $236,991
and $229,987, respectively
   
38,579
     
45,583
 
Total current assets
   
59,013
     
54,404
 
                 
Property and equipment, net accumulated depreciation  
of $969,294 and $936,332, respectively
   
180,134
     
206,096
 
TOTAL ASSETS
 
$
239,147
   
$
260,500
 
                 
LIABILITIES
               
Current liabilities:
               
Accounts payable
 
$
1,182,298
   
$
1,345,174
 
Accrued expenses
   
2,069,250
     
2,189,269
 
Notes payable - current portion
   
1,023,827
     
1,092,126
 
Settlement obligation
   
8,686,824
     
8,686,824
 
Short-term debt – related parties
   
2,866,525
     
2,887,013
 
Total current liabilities
   
15,828,724
     
16,200,406
 
                 
Total liabilities
   
15,828,724
     
16,200,406
 
                 
Commitments and contingencies
   
-
     
-
 
                 
STOCKHOLDERS’ DEFICIT
               
Preferred stock, 300,000,000 shares authorized,
none issued and outstanding
   
-
     
-
 
Common stock, $.001 par value; 300,000,000 shares authorized;
 121,495,796 and 106,969,733 shares issued and outstanding, respectively
   
121,496
     
106,970
 
Additional paid-in capital
   
48,251,950
     
47,494,900
 
Treasury stock
   
(200,000
)
   
(200,000
)
Accumulated deficit
   
(63,763,023
)
   
(63,341,776
)
Total stockholders’ deficit
   
(15,589,577
)
   
(15,939,906
)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT
 
$
239,147
   
$
260,500
 

 
See accompanying notes to unaudited consolidated financial statements.

 
3
 

EARTH SEARCH SCIENCES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)



   
Three months ended
June 30,
 
   
2008
   
2007
 
             
Revenues
  $ -     $ -  
                 
Operating expenses
               
Late fees related to settlement agreement
    -       860,040  
Depreciation and amortization
    25,962       34,939  
General and administrative
    275,706       322,039  
                 
Total expenses
    301,668       1,217,018  
                 
Loss from operations
    (301,668 )     (1,217,018 )
                 
Other income (expense)
               
Gain on settlement of debt
    -       15,049  
Interest expense
    (119,579 )     (112,302 )
                 
Net loss
  $ (421,247 )   $ (1,314,271 )
                 
Basic and diluted:
               
Loss per share
  $ (0.00 )   $ (0.01 )
Weighted average common shares outstanding
    111,376,933       96,570,518  
                 
                 
 

See accompanying notes to unaudited consolidated financial statements.


 
4
 


EARTH SEARCH SCIENCES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

   
Three Months Ended
 
   
June 30,
 
   
2008
   
2007
 
             
CASH FLOWS FROM OPERATING ACTIVITIES
           
Net loss
 
$
(421,247
)
 
$
(1,314,271
)
Adjustments to reconcile net loss to cash used in operating activities:
               
Depreciation and amortization
   
25,962
     
25,962
 
Amortization of deferred finance costs
   
7,004
     
8,977
 
Common stock issued for services
   
285,202
     
113,496
 
Common stock issued for vendor payable
   
129,969
     
-
 
Imputed interest
   
11,405
     
11,104
 
Gain on settlement of debt
   
-
     
(15,049)
 
                 
Changes in assets and liabilities:
               
Accounts payable
   
(162,876
)
   
32,285
 
Accounts payable – related party
   
-
     
(74,620)
 
Accrued interest – related parties
   
44,544
     
-
 
Accrued settlement liability
   
-
     
929,541
 
Accrued expenses
   
(120,019
) 
   
60,000
 
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES
   
(200,056
)
   
(222,575
)
                 
CASH FLOWS FROM FINANCING ACTIVITIES
               
Proceeds from stockholder loans, net
   
-
     
330,000
 
Repayment on related party debt
   
(65,032
)
   
-
 
Proceeds from subscription receivable
   
-
     
250,000
 
Financing costs
   
-
     
(47,347
) 
Proceeds from issuance of common stock
   
345,000
     
-
 
Principal payments on short-term debt
   
(68,299
)
   
-
 
Principal payments on long-term debt
   
-
     
(198,042
) 
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
   
211,669
     
334,611
 
                 
NET INCREASE IN CASH
   
11,613
     
112,036
 
CASH AT BEGINNING OF PERIOD
   
8,821
     
23,182
 
CASH AT END OF PERIOD
 
$
20,434
   
$
135,218
 
                 
                 
SUPPLEMENTAL CASH FLOW INFORMATION:
               
Interest paid
 
$
110,738
   
$
-
 
Taxes paid
   
-
     
-
 
                 
Non-cash financing and investing activities:
               
Common stock issued for debt repayment
 
$
-
   
$
26,000
 

See accompanying notes to unaudited consolidated financial statements.

 
5
 

EARTH SEARCH SCIENCES, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT
Three months ended June 30, 2008
(Unaudited)





   
Common
Shares
   
Stock
Amount
   
Additional
Paid-in
Capital
   
Treasury
Stock
   
Accumulated
Deficit
   
Total
 
Balances at March 31, 2008
   
106,969,733
   
$
106,970
   
$
47,494,900
   
$
(200,000
)
 
$
(63,341,776
)
 
$
(15,939,906
)
                                                 
Issuance of common stock for vendor payable
   
1,708,890
     
1,708
     
128,261
                     
129,969
 
                                                 
Issuance of common stock for services rendered
   
4,817,173
     
4,818
     
280,384
                     
285,202
 
                                                 
Issuance of common stock for cash
   
8,000,000
     
8,000
     
337,000
                     
345,000
 
                                                 
Imputed interest
                   
11,405
                     
11,405
 
                                                 
Net loss
                                   
(421,247
)
   
(421,247
)
                                                 
Balances at June 30, 2008
   
121,495,796
   
$
121,496
   
$
48,251,950
   
$
(200,000
)
 
$
(63,763,023
)
 
$
(15,589,577
)







See accompanying notes to unaudited consolidated financial statements.

 
6
 

EARTH SEARCH SCIENCES, INC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements of Earth Search Sciences, Inc. ("ESSI") 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 ESSI's Annual Report filed with the SEC on Form 10-KSB for the fiscal year ended March 31, 2008.  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 the 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 consolidated financial statements for 2008 as reported in the 10-KSB have been omitted.

Certain prior period amounts have been reclassified to conform with the current period presentation.

NOTE 2 - GOING CONCERN

As shown in the accompanying financial statements, we incurred a net loss of $421,247 for the three months ended June 30, 2008 and had an accumulated deficit of $63,763,023 and a working capital deficit of $15,769,711 as of the same period.  These conditions raise substantial doubt as to ESSI's ability to continue as a going concern.  Management is trying to raise additional capital through sales of stock and or loans to the Company.  The financial statements do not include any adjustments that might be necessary if ESSI is unable to continue as a going concern.

NOTE 3 - EQUITY

During the three months ended June 30, 2008 we issued:

·   
4,817,173 shares of stock valued at $285,202 to various individuals for consulting services. The value of the stock was based on the quoted market price on the date of grant.

·   
1,708,890 shares of stock valued at $129,969 for a vendor payable at March 31, 2008 pursuant to a consulting agreement.

·   
8,000,000 shares of stock valued at $345,000 to various individuals for cash.

NOTE 4 – SUBSEQUENT EVENTS

On July 15, 2008, we announced the appointment of Luis F. Lugo as our Chief Executive Officer.   Larry Vance, formerly chairman and CEO of Earth Search Sciences, will continue in his role as chairman of the board.

Subsequent to June 30, 2008, we issued the following:

We issued 2,000,000 shares of common stock to our new Chief Executive Officer valued at approximately $120,000.

We issued 1,119,106 shares of common stock for services valued at approximately $72,670.

We issued 18,729,999 shares of common stock for cash proceeds totaling $1,010,000.

7

 
FORWARD-LOOKING STATEMENTS
 
This Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Item 2 of Part I of this Quarterly Report include forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by forward-looking statements.

In some cases, you can identify forward-looking statements by terminology such as "may," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "proposed," "intended," or "continue" or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other "forward-looking" information. There may be events in the future that we are not able to accurately predict or control. You should be aware that the occurrence of any of the events described in this Quarterly Report could substantially harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of this Quarterly Report to conform these statements to actual results.



 
8
 

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

 
The following discussion should be read in conjunction with Earth Search Sciences, Inc.’s (“Earth Search”, the “Company”, “we”, or “us”) unaudited consolidated financial statements and notes included herein.  The results described below are not necessarily indicative of the results to be expected in any future period.  Certain statements in this discussion and analysis, including statements regarding our strategy, financial performance and revenue sources, are forward-looking statements based on current expectations and entail various risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements.  Readers are referred to our Annual Report on Form 10-KSB for the year ended March 31, 2008 as filed with the Securities and Exchange Commission (“SEC”).  We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in our expectations.
 

CORPORATE FOCUS

In December, 1985 we acquired all of the outstanding shares of common stock of a privately held company known as Earth Search Sciences, Inc. (ESSI), a Utah corporation formed on August 29, 1985.  We issued 13,639,600 shares of its common stock in exchange for ESSI's outstanding shares.  This merger was a reverse acquisition and accounted for as a pooling of interests.  Accordingly, the assets and liabilities of the two companies were combined at their recorded net book values.  ESSI's principal assets were unpatented mining claims in Alaska that were acquired from ESSI's incorporators at a cost of $126,715.  ESSI's operations were the continuing operations of the Company, and ESSI was the entity which had substance and control both before and after the merger.

We have four wholly-owned subsidiaries: Skywatch Exploration, Inc., Polyspectrum Imaging, Inc., Geoprobe, Inc., and STDC, Inc. In addition, there are five majority-owned consolidated subsidiaries: Earth Search Resources, Inc., Eco Probe, Inc., ESSI Probe 1 LC, Petro Probe, Inc. and Terranet, Inc. All subsidiaries except Petro Probe were inactive during fiscal 2006 and 2007.

We did not generate any revenue during fiscal year 2008, have no current business operations and are currently focused on two potential business ventures.

First, we are seeking joint venture opportunities with private industry, universities and state and federal agencies to develop, package and deliver, through the application of our hyperspectral remote sensing solutions, applications and associated technologies, a superior airborne mapping products and services. Our airborne hyperspectral remote sensing technology is designed to identify specific surface substances and materials by measuring the reflectance of light from their surface. Their first spectroscopic instrument, the PROBE 1, was initially developed with the assistance of NASA and used a small aircraft as the instrument platform to obtain data from high altitudes over many different terrains. The information was precise enough to enable detailed analysis of a dynamic environment or object in a manner previously unattainable, and can be used for the discovery of certain natural resources.

Second, we are working with certain investors to develop and employ technology in the extraction of oil and gas from oil shale. We are currently in negotiations to fund the research and fabrication of technology used for this purpose. This funding is in conjunction with our negotiation to acquire the patented oil shale technology developed by General Synfuels International, Inc.

On July 15, 2008, we announced the appointment of Luis F. Lugo as our Chief Executive Officer.   Larry Vance, formerly chairman and CEO of Earth Search Sciences, will continue in his role as chairman of the board.  Mr. Lugo previously served as Director of Finance and Strategy for 3AG Distribution (Elf Aquitaine Oil Lubricants Venezuela) and was involved in securing capital investment and in developing the distribution system.  Lugo also served as Engagement Manager of global chemicals and strategy practices for Arthur D. Little Management Consulting, and as Strategy Analyst for BP Amoco where he developed analytical and financial modeling and valuation of acquisition targets for Latin America, Europe and East Asia. Mr. Lugo holds an MBA in International Business Finance and an MA in International Economics from The George Washington University in Washington D.C.

9
We have signed a letter of intent to acquire General Synfuels International, Inc. (GSI) and its patented technology to recover hydrocarbons through an environmentally-conscientious gasification process.  The acquisition enables us to establish a joint venture and commercial licensing program to develop domestic oil shale and other heavy oil resources. We are planning a field test of this technology as early as fall 2008 and subsequent commercial development as early as 2009.

Hyperspectral Remote Sensing Solutions

In the past, we have utilized an aircraft mounted hyperspectral remote sensing instrument to gather precise geological data from the surface of the Earth. Solar energy is reflected from surface materials and the instrument, called "Probe-1", captures the data in digital form. The Probe-1 is a "whiskbroom style" instrument that collects data in a cross-track direction by mechanical scanning and in an along-track direction by movement of the airborne platform. The instrument acts as an imaging spectrometer in the reflected solar region of the electromagnetic spectrum (0.4 to 2.5 nm). In the VNIR and SWIR, the at-sensor radiance is dispersed by four spectrographs onto four detector arrays. Spectral coverage is nearly continuous in these regions with small gaps in the middle of the 1.4 and 1.9 nm atmospheric water bands. In order to avoid geometric distortions in the recorded imagery, the Probe-1 is mounted on a 3 axis, gyro-stabilized mount. Geolocation of nadir pixels is assisted by the recording of aircraft GPS positional data and tagging each scan line with a time that is referenced to the UTC time interrupts from the GPS receiver.

The spectral data is processed to identify unique spectra in the image. The captured and processed spectra are compared to a library of known material spectra called "digital fingerprints" and the output allows the identification of mineral, compounds and organic matter and the determination of vegetative conditions.

We are actively seeking funding to engineer and manufacture a third generation probe instrument, which will be capable of analyzing substantially more data inputs, including chemical, light, pressure, vibration, and acceleration. The new design will operate at extremely high speed with excellent resolution. We expect that the combination of substantially improved analysis and higher resolution will open up new markets.

We are currently evaluating hyperspectral imagery collected to date so that we can determine whether this archive of information can be used to locate mineral properties.

Our aircraft was grounded in 2006 for FAA required maintenance and repairs. As a result, our hyperspectral remote sensing operations have ceased until such time that we raise sufficient funding to repair our aircraft or purchase a new aircraft.

Exploitation of Oil and Gas From Oil Shale

General Synfuels International, Inc., (GSI) a Nevada private company, owns the world-wide proprietary rights, patent, technology, construction plans and materials and operational capability for a gasification process to recover the oil and gas from oil shale. Petro Probe, Inc., a majority owned subsidiary of ESSI, signed a non-exclusive license agreement with GSI to obtain the use of these rights in Utah, Wyoming and Colorado. To utilize this technology, PPI will pay a license fee in the amount of $500,000 and will issue to GSI 500,000 shares of PPI Common Stock, $.001 par value per share. Such fee will be paid in such amounts and at such times as are agreed to in the future by PPI and GSI. PPI also assigned to GSI an overriding net revenue interest of five and one-half percent (5.5%) of the hydrocarbons produced.

ESSI is in negotiation to complete an acquisition of the oil shale technology and if successful will not require the above license agreement

10
PPI is currently examining various oil shale sites in Colorado, Utah and Wyoming for a test plant. Five acres of premium oil shale land is sought. The test plant is budgeted for approximately $3 million as a first stage development cost. The purpose of this plant is to prove the technology. The second and third stages will cost approximately $8 million more at which time the plant could operate at full capacity. All development costs will be paid for by PPI.

We are also examining other available and complementing technologies, including one based in micro-wave technology and another, which is an adaptation of fuel cell energy.

RESULTS OF OPERATIONS

Our data collection aircraft was grounded for repairs for FAA required maintenance in 2006 and has not been operational since that time.  As a result, we had no revenues during the fiscal year ended March 31, 2008 and did not record any revenues during the three months ended June 30, 2008.

We incurred no late fees related to a settlement agreement for the three month period ended June 30, 2008, compared to $860,040 for the same period in 2007.  We anticipate no further late fees will be incurred during the fiscal year ending March 31, 2009.

Depreciation and amortization expense was $25,962 for the three month period ended June 30, 2008, compared to $34,939 for the same period of 2007.

General and administrative expenses were $275,706 for the three month period ended June 30, 2008, compared to $322,039 for the corresponding period of 2007.

Interest expense for the three month period ended June 30, 2008, was $119,579 compared to interest expense of $112,302 for the corresponding period in 2007.

LIQUIDITY AND CAPITAL RESOURCES

Net cash used in operating activities was $200,056 for the three months ended June 30, 2008 compared to net cash used in operating activities of $222,575 for the three months ended June 30, 2007.

Net cash provided by financing activities was $211,669 for the three months ended June 30, 2008 compared to cash provided of $334,611 for the same period of 2007.  During the three months ended June 30, 2008, we received $345,000 of cash from a private placement of our common stock which was offset by payments on related party debt and short term debt totaling $133,331.  This compared to proceeds from a subscription receivable of $250,000 and cash from a private placement of $330,000 for the similar period in 2007 that was offset by payments on debt of $245,389.

We are experiencing working capital deficiencies because of operating losses. We have operated with funds received from the sale of common stock, the issuance of notes and limited operating revenue. Our ability to continue as a going concern is dependent upon continued debt or equity financings until or unless we are able to generate cash flows to sustain ongoing operations. We plan to increase the number of revenue producing services through the use of additional hyperspectral instruments and thereby continue as a going concern.  There can be no assurance that we can generate sufficient operating cash flows or raise the necessary funds to continue as a going concern.


ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a smaller reporting company we are not required to provide disclosure under this Item 3.


 
11
 

ITEM 4T. CONTROLS AND PROCEDU RES

Our management, principally our Chief Executive Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our management concluded that our disclosure controls and procedures as of the end of the period covered by this report were not effective such that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i.) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding disclosure. As part of our management’s assessment of internal controls over financial reporting as of March 31, 2008 we identified material weaknesses in our internal controls which we viewed as an integral part of our disclosure controls and procedures. The material weaknesses are identified below and as of June 30, 2008 have not been remediated.
 
·   
There is an over-reliance upon independent financial reporting consultants for review of critical accounting areas and disclosures and material non-standard transactions.

·   
There is a lack of sufficient accounting staff which results in a lack of segregation of duties necessary for a good system of internal control.

There have been no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) of the Act, in the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.




 
12
 

PART II
OTHER INFORMATION REQUIRED

Item 1.  Legal proceedings
 
     None

Item 1A.  Risk Factors
 
     As a smaller reporting company we are not required to provide disclosure under this Item 1A.

Item 2.   Unregistered sales of equity securities

The shares described below were issued in reliance on upon the exemption from registration as set forth in Section 4(2) of the Securities Act of 1933, as amended, and/or Rule 506 of Regulation D. Each of the recipients was accredited within the meaning of Rule 501(a); the transfer of the securities were restricted by the Company in accordance with Rule 502(d); and none of the offers and sales were effected through any general solicitation or general advertising within the meaning of Rule 502(c).

During the three month period ended June 30, 2008, we issued the following unregistered equity securities:

·   
4,817,173 shares of stock valued at $285,202 to various individuals for consulting services. The value of the stock was based on the quoted market price on the date of grant.

·   
1,708,890 shares of stock valued at $129,969 for common stock payable at March 31, 2008 pursuant to a consulting agreement.

·   
8,000,000 shares of stock valued at $345,000 to various individuals for cash.

Item 3.  Defaults upon senior securities

None

Item 4. Submission of matters to a vote of security holders

None

Item 5.  Other information

Not applicable.

Item 6.  Exhibits

Exhibit Number
Description
   
2.1
Agreement and Plan of Merger by and among Earth Search Sciences, Inc., ESS Acquisition Corp., Space Technology Development Corporation and the shareholders of Space Technology Development Corporation, dated December 21, 1999 ( Incorporated by reference to Exhibit 2.1 to the Registrant's Form 10-K for fiscal year ended March 31, 2000 ).
   
3.1
Articles of Incorporation, as amended ( Incorporated by reference to Exhibit 3.1 to the Registrant's Forms 10-K for the fiscal years ended March 31, 1995 and March 31, 1996 ).
 
 
 
13
 
   
3.2
Bylaws ( Incorporated by reference to Exhibit 3.2 to the Registrants’ Form 10-K for the fiscal year ended March 31, 1995 ).
   
31.1
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith)
   
31.2
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith)
   
32.1
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith)
   
32.2
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith)



 
14
 


SIGNATURE

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


 
EARTH SEARCH SCIENCES, INC.
 
   
Date:  August 14, 2008
/s/  Luis F. Lugo
 
Luis F. Lugo
 
Principal Executive Officer



   
Date:  August 14, 2008
/s/  Tami J. Story
 
Tami J. Story
 
Principal Accounting Officer
 
 

 
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