The following discussion and analysis of our financial condition and result of operations contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in the "Risk Factors" section of the other reports we file with the Securities and Exchange Commission. Actual results may differ materially from those contained in any forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or "continue," the negative of such terms or other comparable terminology. These statements are only predictions.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither we, nor any other person, assume responsibility for the accuracy and completeness of the forward-looking statements. We are under no obligation to update any of the forward-looking statements after the filing of this Annual Report to conform such statements to actual results or to changes in our expectations.

The following discussion and analysis of financial condition and results of operations relates to the operations and financial condition reported in the financial statements of eWellness Healthcare Corporation for the years ended December 31, 2020 and 2019 and should be read in conjunction with such financial statements and related notes included in this report.





15







Overview

Results of Operations of eWellness for the Twelve-month Periods Ended December 31, 2020 vs. 2019

REVENUES: Total net revenues from operations for the years ended December 31, 2020 and December 31, 2019, were $255,346 and $3,635, respectively.

OPERATING EXPENSES: Total operating expenses decreased to $2,647,662 for the year ended December 31, 2020 from $4,304,842 for the year ended December 31, 2019 reflecting a decrease of $1,657,180. The decrease resulted from a reduction in number of shares of common stock issued to consultants offset by an increase in financing fees for conversion of convertible debt and increase of executive compensation expensed resulting from the officers' Settlement and Agreements signed in February 2021 with an effective date of October 1, 2020. These agreements outlined that the preferred stock issued in 2019 would be fully vested at the year ended December 31, 2020.

NET LOSS: The Company incurred a net loss of $8,771,527 for the year ended December 31, 2020, compared with a net loss of $9,460,785 for the year ended December 31, 2019, which reflects a decrease of $689,258. The decrease is primarily because of a decrease of general and administrative expenses and professional fees (outlined above) of $2,016,819, decrease in interest expense of $3,572,731 and increase in loss on derivative liability of $4,720,487.

Liquidity and Capital Resources

As of December 31, 2020, we had negative working capital of $6,660,570 compared to negative working capital of $6,937,847 as of December 31, 2019. The main portion of the negative working capital decrease is because of a decrease in convertible debt, net of discount, a decrease in accounts payable - related party offset by an increase in derivative liability. Cash used in operations was $284,613 and $2,978,814 for the years ended December 31, 2020 and 2019, respectively. This is primarily due to a decrease in the net loss, decrease in amortization of debt discount and prepaids offset by an increase in loss on derivative liability. Cash flows provided by financing activities were $45,000 and $2,849,650 for the years ended December 31, 2020 and December 31, 2019, respectively. The decrease in cash flows from financing activities was from reduction of the issuance of convertible debt for cash. The cash balance as of December 31, 2020 was $1,109.

We do not have sufficient cash on hand to operate. Our ability to meet our obligations and continue to operate as a going concern is highly dependent on our ability to obtain additional financing. We cannot predict whether this additional financing will be in the form of equity or debt or be in another form. We may not be able to obtain the necessary additional capital on a timely basis, on acceptable terms, or at all. In any of these events, we may be unable to implement our current plans which circumstances would have a material adverse effect on our business, prospects, financial conditions and results of operations.





Contingencies

The Company may be subject to lawsuits, administrative proceedings, regulatory reviews or investigations associated with its business and other matters arising in the normal conduct of its business.

Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Contractual Obligations and Commitments

In March 2020, the Company executed a 12% Convertible Promissory Note payable to an institutional investor in the principal amount of $52,800. The note, which is due on January 15, 2021, has an original issue discount of $4,800 and transaction costs of $3,000. After 180 days, the convertible note converts into common stock of the Company at a conversion price that shall be equal to 70% of the average of the two lowest per share trading prices for the ten (10) trading days prior to the conversion date. As of December 31, 2020, this note was fully converted and during the year ended December 31, 2020 the Company accrued interest of $2,880.





16

From time to time the Company may become a party to litigation matters involving claims against the Company. Except as may be outlined above, the Company believes that there are no current matters that would have a material effect on the Company's financial position or results of operations.





CRITICAL ACCOUNTING POLICIES

Our significant accounting policies are disclosed in Note 2 of our Financial Statements included elsewhere in this Report.

© Edgar Online, source Glimpses