EcoloCap Solutions Inc. (fka ECOS)

[deal guy]

The $14m deferred tax asset under the tax rules would normally take a long time to use. Some of their losses may be limited as they could have experienced multiple Section 382 changes in control over the past 5 years (including 2017).

They will likely see a 2017 income of between $0-50k (before debt refinancing/conversion). When they convert the debt to equity the derivative liability goes away and the discharge of debt will become income reducing the NOL and eliminating the deferred tax asset.

If you are running a valuation model on ECOS you would allocate zero value as it will be wiped out for the most part in the debt conversion.