UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

FORM 10-Q

[X]☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, June 30, 2021

Commission file number 0-54862

E-QURE CORP.

(Exact Name Of Registrant As Specified In Its Charter)

Registrant’s Telephone Number, Including Area Code: +(972) +(972)54 427777

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 (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] ☒ No [  ]☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] ☐ No [X] ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act) or a smaller reporting company.

On July 6,September 29, 2021, the Registrant had 34,546,060 shares of common stock outstanding.

Securities registered pursuant to Section 12(g) of the Act:

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

E-QURE CORP.

Balance Sheets

At March 31,June 30, 2021 (Unaudited) and December 31, 2020

E-QURE CORP.

Statements of Operations and Comprehensive Income (Loss)

For The Three Months Ended March 31, 2021 and 2020

(Unaudited)

See Notes to Unaudited Interim Financial Statements.

E-QURE CORP.

Statements of Operations

For The Three and Six Months Ended June 30, 2021 and 2020

(Unaudited)

See Notes to Unaudited Interim Financial Statements

E-QURE CORP.

Statements of Changes in Stockholders’Shareholders’ Equity (Deficit)

For the Three-MonthSix-Month Periods ended March 31,June 30, 2021 and 2020

(Unaudited)

See Notes to Unaudited Interim Financial Statements.

E-QURE CORP.

Statements of Cash Flows

For The ThreeSix Months Ended March 31,June 30, 2021 and 2020

(Unaudited)

See Notes to Unaudited Interim Financial Statements.

E-Qure Corp.

Notes to Unaudited Interim Financial Statements

March 31, 2021June, 30 2020

1. The Company and Significant Accounting Policies

Organizational Background

E-Qure Corp. (“EQURE”E-Qure” or the “Company”) is a Delaware corporation with offices in Israel. EQUREE-Qure owns IP of innovate technology of wound healing device (BST).

Basis of Presentation:

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has not established any source of revenue to cover its operating costs, and as such, has incurred an operating loss since inception.

Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from the estimates.

Cash and Cash Equivalents

For financial statement presentation purposes, the Company considers those short-term, highly liquid investments with original maturities of three months or less to be cash or cash equivalents. There were no0 cash equivalents as of March 31,June 30, 2021 and December 31, 2020.

Property and Equipment

New property and equipment are recorded at cost. Property and equipment included in the bankruptcy proceedings and transferred to the Trustee had been valued at liquidation value. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally 5 years. Expenditures for renewals and betterments are capitalized. Expenditures for minor items, repairs and maintenance are charged to operations as incurred. Gain or loss upon sale or retirement due to obsolescence is reflected in the operating results in the period the event takes place.

Valuation of Long-Lived Assets

We review the recoverability of our long-lived assets including equipment, goodwill and other intangible assets, when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on our ability to recover the carrying value of the asset from the expected future pre-tax cash flows (undiscounted and without interest charges) of the related operations. If these cash flows are less than the carrying value of such asset, an impairment loss is recognized for the difference between estimated fair value and carrying value. Our primary measure of fair value is based on discounted cash flows. The measurement of impairment requires management to make estimates of these cash flows related to long-lived assets, as well as other fair value determinations.

Stock Based Compensation

Stock-based awards are accounted for using the fair value method in accordance with ASC 718, Share-Based Payments. Our primary type of share-based compensation consists of stock options. We use the Black-Scholes option pricing model in valuing options. The inputs for the valuation analysis of the options include the market value of the Company’s common stock, the estimated volatility of the Company’s common stock, the exercise price of the warrants and the risk-free interest rate.

Accounting For Obligations And Instruments Potentially To Be Settled In The Company’s Own Stock

We account for obligations and instruments potentially to be settled in the Company’s stock in accordance with FASB ASC 815, Accounting for Derivative Financial Instruments. This issue addresses the initial balance sheet classification and measurement of contracts that are indexed to, and potentially settled in, the Company’s own stock.

Fair Value of Financial Instruments

FASB ASC 825, “Financial Instruments,” requires entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value. FASB ASC 825 defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. At March 31,June 30, 2021 and December 31, 2020, the carrying value of certain financial instruments (cash and cash equivalents, accounts payable and accrued expenses.) approximates fair value due to the short-term nature of the instruments or interest rates, which are comparable with current rates.

Fair Value Measurements

The Company measures fair value under a framework that utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of inputs which prioritize the inputs used in measuring fair value are:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Other inputs that are observable, directly or indirectly, such as quoted prices for similar assets and liabilities or market corroborated inputs.

Level 3: Unobservable inputs are used when little or no market data is available, which requires the Company to develop its own assumptions about how market participants would value the assets or liabilities. The fair value hierarchy gives the lowest priority to Level 3 inputs.

In determining fair value, the Company utilizes valuation techniques in its assessment that maximize the use of observable inputs and minimize the use of unobservable inputs. The following table presents the Company’s financial assets and liabilities that are carried at fair value, classified according to the three categories described above:

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

Fair Value Measurements at March 31,June 30, 2021

Fair Value Measurements at December 31, 2020

When the Company changes its valuation inputs for measuring financial assets and liabilities at fair value, either due to changes in current market conditions or other factors, it may need to transfer those assets or liabilities to another level in the hierarchy based on the new inputs used. The Company recognizes these transfers at the end of the reporting period that the transfers occur. For the fiscal periods ended March 31,June 30, 2021 and December 31, 2020, there were no significant transfers of financial assets or financial liabilities between the hierarchy levels.

Earnings per Common Share

We compute net income (loss) per share in accordance with ASC 260, Earning per Share. ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of March 31, 2021, the Company is subject to $615,939 in stock payable and as a result is obliged to issue a total of 6,159,390 shares of common stock. In addition, the Company may have to issued a total of 12,427,464 shares of common stock underlying Warrants Class B and C that are vested and exercisable as of March 31, 2021.

Income Taxes

We have adopted ASC 740, Accounting for Income Taxes. Pursuant to ASC 740, we are required to compute tax asset benefits for net operating losses carried forward. The potential benefits of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.

We must make certain estimates and judgments in determining income tax expense for financial statement purposes. These estimates and judgments occur in the calculation of certain tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes.

Deferred tax assets and liabilities are determined based on the differences between financial reporting and the tax basis of assets and liabilities using the tax rates and laws in effect when the differences are expected to reverse. ASC 740 provides for the recognition of deferred tax assets if realization of such assets is more likely than not to occur. Realization of our net deferred tax assets is dependent upon our generating sufficient taxable income in future years in appropriate tax jurisdictions to realize benefit from the reversal of temporary differences and from net operating loss, or NOL, carryforwards. We have determined it more likely than not that these timing differences will not materialize and have provided a valuation allowance against substantially all of our net deferred tax asset.

Management will continue to evaluate the realizability of the deferred tax asset and its related valuation allowance. If our assessment of the deferred tax assets or the corresponding valuation allowance were to change, we would record the related adjustment to income during the period in which we make the determination. Our tax rate may also vary based on our results and the mix of income or loss in domestic and foreign tax jurisdictions in which we operate.

In addition, the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations. We recognize liabilities for anticipated tax audit issues in the U.S. and other tax jurisdictions based on our estimate of whether, and to the extent to which, additional taxes will be due. If we ultimately determine that payment of these amounts is unnecessary, we will reverse the liability and recognize a tax benefit during the period in which we determine that the liability is no longer necessary. We will record an additional charge in our provision for taxes in the period in which we determine that the recorded tax liability is less than we expect the ultimate assessment to be.

ASC 740 which requires recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carry-forwards. Measurement of deferred income tax is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized.

Uncertain Tax Positions

The Financial Accounting Standards Board issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement No. 109, Accounting for Income Taxes” (“FIN No. 48”) which was effective for the Company on January 1, 2007. FIN No. 48 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under FIN No. 48, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. FIN No. 48 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure requirements.

We are not under examination by any jurisdiction for any tax year. At March 31,June 30, 2021, we had no0 material unrecognized tax benefits and no adjustments to liabilities or operations were required under FIN 48.

Recent Accounting Pronouncements

In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases. The amendments in ASU 2018-10 provide additional clarification and implementation guidance on certain aspects of the previously issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”) and have the same effective and transition requirements as ASU 2016-02. Upon the effective date, ASU 2018-10 will supersede the current lease guidance in ASC Topic 840, Leases. Under the new guidance, lessees will be required to recognize for all leases, lease with the exception of short-term leases, a lease liability, which is a lessee’s obligation to make payments arising from a lease, measured on a discounted basis. Concurrently, lessees will be required to recognize a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU 2018-10 is effective for private companies and emerging growth public companies for interim and annual reporting periods beginning after December 15, 2019, with early adoption permitted. The guidance is required to be applied using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative periods presented in the financial statements. During the year ended December 31, 2020, the Company assessed the impact this guidance had on its financial statements and concluded that at present ASU No. 2018-10 has no impact on its financial statements due to not having any commitment to stay in our property longer than a year.

Management does not anticipate that the adoption of these standards will have a material impact on the financial statements.

2. Stockholders’ Equity

Common Stock

We are currently authorized to issue up to 500,000,000 shares of $0.00001$0.00001 par value common stock. All issued shares of common stock are entitled to vote on a 1 share/1 vote basis.

Issuances of Common Stock During the Period ended March 31,June 30, 2021:

During the three-monthsix-month period ended March 31,June 30, 2021, the Company received proceeds of $121,048$266,468 from a related party from 1,210,4802,664,680 shares of common stock to be issued at $0.10$0.10 per share.

Issuances of Common Stock During the Period ended March 31,June 30, 2020:

The Company did not issue any Common Stock during the threesix months ended March 31, 2021.June 30, 2020.

Preferred Stock

We are currently authorized to issue up to 25,000,000 shares of $0.00001$0.00001 par value preferred stock. There are no0 preferred shares outstanding as of March 31,June 30, 2021 and December 31, 2020.

Stock Options

On January 1, 2015, the Company authorized the adoption of the 2015 Employee Incentive Plan.

Warrants Granted

During the year ended December 31, 2018, the Company’s chief executive officers and chairman converted debt and accrued wages in the aggregate amount of $275,303$275,303 into Units consisting of a total of: (i) 2,753,030 restricted shares, 1,376,515 Class A Warrants exercisable to purchase 0.5 shares of common stock at $0.50$0.50 per shares for a period of 24 months and Class B Warrants exercisable to purchase 0.5 shares of common stock at $1.25$1.25 per shares for a period of 36 months, having the same terms as the Class A and Class B Warrants set forth in the Reg S Unit Offering, and 2,750,000 Class C Warrants exercisable to purchase one share of Common Stock at a price of $1.00$1.00 per Share. The warrants were valued at $385,552$385,552 using the Black- Scholes valuation model and were recorded for a total as loss on conversion on debt under additional paid in capital of $315,900.$315,900.

Following is a table summarizing warrants outstanding and exercisable along with exercise price.

Schedule of Warrants Outstanding and Exercisable

The following table summarizes stock warrant activities for the three-monthssix-months ended March 31,June 30, 2021 and 2020:

Schedule of Warrant Activity

3. Notes Payable

During period ended March 31,June 30, 2021 and 2020, the Company received no0 funds related to the issuance of notes. As of March 31,June 30, 2021 and December 31, 2020, the Company had outstanding loans due to related party of $100,000$100,000 and $65,905$65,905 due to an unrelated party. During the three-month period ended March 31,June 30, 2021 and 2020, the Company incurred imputed interest charges of $4,091$4,136 and $4,136,$4,137, respectively. During the six-month period ended June 30, 2021 and 2020, the Company incurred imputed interest charges of $8,227 and $8,273, respectively.

Schedule of Notes Payable

4. Related Party Transactions not Disclosed Elsewhere

During period ended March 31,June 30, 2021 and 2020, the Company received no0 funds related to the issuance of notes. As of March 31,June 30, 2021 and December 31, 2020, the Company had outstanding loans due to Itsik Ben Yesha, our CTO of $100,000.$100,000. During the three-month period ended March 31,June 30, 2021 and 2020, the Company incurred imputed interest charges of $2,466$4,136 and $2,466,$4,137, respectively, related to the loans outstanding to Itsik Ben Yesha. During the six-month period ended June 30, 2021 and 2020, the Company incurred imputed interest charges of $8,227 and $8,273, respectively. As of March 31,June 30, 2021 and December 31, 2020, the Company owed $100,000$100,000 in notes payable to Itsik Ben Yesha, the CTO and a related party.

During the three-month period ended March 31,June 30, 2021, the Company received proceeds of $121,048$145,420 from a related party from 1,210,4801,454,200 shares of common stock to be issued at $0.10 per share.

As of March 31,June 30, 2021 and December 31, 2020, we had accrued salaries of $337,536$411,825 and $309,456,$309,456, respectively, due to three of our officers.

As of March 31,June 30, 2021 and December 31, 2020, we had accrued interest of $1,564,$1,564, due to Mr. Weissberg, who is the Company’s Chairman of the audit committee. The principal underlying the note was converted in 2014.

5. Foreign currency translation

The Company maintains its books and record in its local currency, Israeli Shekel ILS (“ILS”), which is a functional currency as being the primary currency of the economic environment in which its operation is conducted. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statements of operations.

The reporting currency of the Company is the United States Dollars (“US$”) and the accompanying financial statements have been expressed in US$. In accordance with ASC Topic 830-30, “Translation of Financial Statement”, assets and liabilities of the Company whose functional currency is not US$ are translated into US$, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements are recorded as a separate component of accumulated other comprehensive income (loss) within the statements of changes stockholders’ equity (deficit).

Translation of amounts from the local currency of the Company into US$1 has been made at the following exchange rates:

Schedule of Translation of Amounts from Local Currency

6. Going Concern

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has not established any source of revenue to cover its operating costs, and as such, has incurred an operating loss since inception. These and other factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern. Our future

Management has plans to address the Company’s financial situation as follows:

In the near term, management plans to continue to focus on raising the funds necessary to implement the Company’s business plan. Management will continue to seek out debt and equity financing transactions may includeto obtain the issuance of equity and/or debt securities. We may raise funds through additional private placements of equity or convertible debt. We do not have any arrangements with potentialcapital required to meet the Company’s financial obligations. There is no assurance, however, that investors or lenderswill continue to provide us with anycapital to the Company or that the new business operations will be profitable. The possibility of failure in obtaining additional financingfunding and the potential inability to achieve profitability raises doubts about the Company’s ability to continue as a going concern.

In the long term, management believes that the Company’s projects and initiatives will be successful and will provide cash flow to the Company that will be used to finance the Company’s future growth. However, there can be no assuranceassurances that any such additional financingthe Company’s planned activities will be available when required in ordersuccessful, or that the Company will ultimately attain profitability. The Company’s long-term viability depends on its ability to proceed withobtain adequate sources of debt and/or equity funding to meet current commitments and fund the continuation of its business plan.operations, and the ability of the Company to achieve adequate profitability and cash flows from operations to sustain its operations.

7. Subsequent Events

There were no subsequent events following the period ended March 31,June 30, 2021 through the date the financial statements were issued that would materially affect the financial statements.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATION

The following plan of operation provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition. The discussion should be read along with our financial statements and notes thereto. This section includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our predictions.

Plan of Operations

In January 2014, Mr. Weissberg negotiated with Lifewave Ltd., a public company organized under the laws of the State of Israel, for the purpose of acquiring certain of Lifewave’s IP assets pertaining to a wound healing device. The Registrant signed a patent purchase agreement with Lifewave on January 6, 2014 (the “Agreement”), the closing of which was subject to several material conditions, including our ability of raising equity capital sufficient to develop and commercially exploit the technology.

On June 4, 2014, we completed the purchase of all right, title and interest to certain IP assets, including rights to a wound treatment device. The IP assets, including the wound healing device, acquired by the Registrant are designed for wound treatment incorporating Bioelectrical Signal Therapy (“BST Device”). The BST Device implements patented and proprietary electrical stimulation technologies to treat hard-to-cure wounds and ulcers up to complete closure and/or cure.

Pursuant to the Agreement, the Registrant has agreed to pay Lifewave a royalty of from 10% to 20% of the profits (as defined in the Agreement) generated from the BST Device.

The Company’s success is dependent upon the successful clinical trial of its BST Device. The Device may need additional development and may never achieve safety or efficacy. The Company believes that its design and procedure show promise, but the path to commercial success, even if development milestones are met, may take more time and might be more costly.

There are a number of potential obstacles the Company might face, including the following:

Recent Developments

During the first quarter of fiscal 2020, we were granted approval from the Helsinki committee to launch a Randomized Control Study (RCT) on 60-100 patients in order to assess the efficacy of the BST Device on diabetic foot patients in collaboration with Clalit Health Services Organization, Israel’s largest HMO, and the Israeli Ministry of Health (MOH). The study will be conducted at 3 to 5 sites including leading clinics and hospitals in Israel. To date, we have agreements with two outpatient clinics and one private clinic to conduct our clinical trial study. We have enrolled 15 to 20 patients out of the required minimum 60 patients for our study. Our enrollment process has been negatively impacted by COVID 19, but expect to complete our enrollment by the end of the year 2021. We expect trial completion within 12 to 18 months upon completion of the enrollment. We plan to enroll between 60 to 100 patients based on a ratio of 2:1 between BST treatment group and the control group receiving only standard care. The double arm clinical trial will be conducted on patients with diabetic foot ulcers. The BST arm will be treated with the BST device three times a day. Our trial protocol requires two weeks of pre-trial screening to determine if the wounds qualify for the trial by showing no self-healing of more than 10%. Subsequent to the screening period, the trial period will consist of 112 treatment days with the BST device followed by 28 days monitoring the post-treatment wounds. The control group will be monitored the same way except it will not receive the BST device treatment.

The Company has concluded a 35-wound, one arm clinical pilot, treating recalcitrant wounds in a leading wound clinic in Tel Aviv Israel, with 78% of the treated wounds completely healed within 20 weeks (Avg. wound duration at the base was 8 months) and an additional 16% of the treated wounds reaching wound area reduction of greater than 75%. Only 6% of the patients had no substantial positive clinical effect.

The Company’s distributor in Colombia, TekMedica SAS, has successfully concluded a clinical pilot study at the Hospital de la Samaritana in Bogota, Colombia. Colsanitas, a leading Colombian HMO/Health insurance provider and operator of comprehensive healthcare services in Colombia and a member of the Sanitas group worldwide, intends to commence a clinical pilot study which is expected to be concluded by the end of the year 2021. If positive results are achieved, similar to those achieved in the one arm clinical pilot in Tel Aviv, Israel, the Company believes that upon regulatory approval it will be successful in marketing and selling the BST device treatment with to Colsanitas health services in Colombia.

On February 20, 2017, the Registrant received the official certification from the Israeli Ministry of Health authorizing the use of the Registrant’s BST Device in Israel. The BST Device implements patented and proprietary electrical stimulation technologies to treat hard-to-cure wounds and ulcers up to complete closure and/or cure.

On January 8, 2017, the Registrant entered into a five-year distribution agreement (the “Distribution Agreement”) with TekMedica SAS, organized under the laws of Colombia (“TekMedica” or the “Distributor”). Pursuant to the Distribution Agreement, the Registrant granted TekMedica the exclusive rights to distribute the Registrant’s medical device for the treatment of chronic wounds (the “BST Device™”) and the accompanying disposable electrodes (sometimes collectively, the “Products”) in Colombia (the “Territory”). The Company terminated its Distribution Agreement with TekMedica in March 2021.

Our distribution agreements provide that the Company will provide the distributor with supplies of the BST Devise and disposable electrode for treatment of patients in hospitals, long-term care facilities, medical centers and out-patient clinics. The distributor will make an initial advance payment to be applied against the first year’s quota as set forth in the Distribution Agreement, with minimum annual quota’s during the five-year term. The distributor will be responsible for securing any product certification, permit, license or approval that may be required in the territory for the marketing, sale, sublicensing and delivery and use of the BST Devise in the territory.

Results of Operations during the three months ended March 31,June 30, 2021 as compared to the three months ended March 31,June 30, 2020

We have not generated any revenues during the three-month ended March 31,June 30, 2021 and 2020. We had operating expenses mainly related to general and administrative expenses and research and development expenses. During the three-month period ended March 31,June 30, 2021, we incurred a net loss from operations of $216,990$236,319 due to general and administrative expenses of $105,790$105,250 and research and development expenses of $104,567$126,933 as compared to a net loss from operation of $156,887$85,708 due to general and administrative expenses of $93,371$99,165 and research and development expenses of $59,380$33,972 in the same period in the prior year. During the three months ended March 31,June 30, 2021 and 2020, we incurred interest expenses of $4,091$4,136 and $4,136,$4,137, respectively.

During the three months ended March 31,June 30, 2021 and 2020, we had a net loss of $216,990$236,319 and $156,887,$85,708, respectively.

Results of Operations during the six months ended June 30, 2021 as compared to the six months ended June 30, 2020

We have not generated any revenues during the six-month ended June 30, 2021 and 2020. We had operating expenses mainly related to general and administrative expenses and research and development expenses. During the six-month period ended June 30, 2021, we incurred a net loss from operations of $453,309 due to general and administrative expenses of $211,040 and research and development expenses of $231,500 as compared to a net loss from operation of $242,595 due to general and administrative expenses of $192,536 and research and development expenses of $93,352 in the same period in the prior year. During the six months ended June 30, 2021 and 2020, we incurred interest expenses of $8,227 and $8,273, respectively.

During the six months ended June 30, 2021 and 2020, we had a net loss of $453,309 and $242,595, respectively.

Liquidity, Capital Resources and Strategy

On March 31,June 30, 2021, we had total assets of $19,428$13,877 consisting of cash in the same amount. On December 31, 2020, we had total assets of $81,070 consisting of cash in the same amount. We had total current liabilities of $508,001$582,290 as of March 31,June 30, 2021 consisting of $2,996 in account payable, $1,564 in accrued interest, $337,536$411,825 in accrued salaries and $165,905 in loans payable to shareholders. We had total current liabilities of $479,921 as of December 31, 2020 consisting of $2,996 in accounts payable, $1,564 in accrued interest, $309,456 in accrued salaries and 165,905 in loans from shareholders payable.

We used $184,819$199,275 in our operating activities during the threesix months ended March 31,June 30, 2021, which was due to a net loss of $216,990$453,309 offset by imputed interest of $4,091$8,227 and an increase in accounts payable and accrued expenses of $28,080.$102,369.

We used $95,376$342,713 in our operating activities during the threesix months ended March 31,June 30, 2020, which was due to a net loss of $156,887$242,595 offset by imputed interest of $4,136$8,273 and an increase in accounts payable and accrued expenses of $57,375.$99,495.

We financed our negative cash flow from operations during the threesix months ended March 31,June 30, 2021 through proceeds from stock payable of $121,048.$266,468. We had no financinginvesting activities during the threesix months ended March 31,June 30, 2021.

We financed our negative cash flow from operations during the threesix months ended March 31,June 30, 2020 through proceeds from stock payable of $270,976. We had no financing activities during the three months ended March 31, 2020.

$360,416. We had no investing activities during the threesix months ended March 31, 2021 andJun e 30, 2020.

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America with an auditor’s going concern opinion for the years 2020 and 2019. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills and meet our other financial obligations. This is because we have not generated any revenues and no revenues are anticipated.

The Company has reported a net loss of $216,990$453,309 during the threesix months ended March 31,June 30, 2021 and had accumulated deficits of $34,898,683$35,135,002 as of March 31,June 30, 2021.

The Company had no revenues from operations during the threesix months ended March 31,June 30, 2021 and 2020. As of March 31,June 30, 2021, the Company had $19,428$13,877 cash on hand and had negative working capital of $488,573.$568,413.

We believe that our current cash on hand of $19,428$13,877 as of March 31,June 30, 2021, will not be sufficient to meet our operating requirements throughout the ensuing twelve-month period. We require additional financing at satisfactory terms and conditions, of which there can be no assurance, in order to satisfy our ongoing capital requirements for the next twelve months in order to execute our plan of operation as presently constituted.

We do not expect to generate cash flow from operations unless we receive FDA approval for our BST Device.

Our management believes that our operations will generate revenues in the US beginning of 2022. We expect that FDA approval for our BST Device will improve our ability to generate revenues from sales in other geographic areas. Our future ability to generate cash flows from operations will depend on the demand for our BST Device, as well as general economic, financial, competitive and other factors, many of which are beyond our control.

If and when we receive FDA approval of our BST Device, of which there can be no assurance, our business might not generate sufficient future cash flow in an amount sufficient to enable us to fund our liquidity needs, including working capital, capital expenditures, investments and other general corporate requirements.

Availability of Additional Capital

We have no commitments or arrangements, formal or otherwise, from any person or entity to provide us with any additional capital. The Company may be unable to implement its present plan of operation and this could have a material adverse effect on our business, prospects, financial condition and results of operations.

Our future financing transactions may include the issuance of equity and/or debt securities. In the event that we seek to raise funds through additional private placements of equity or convertible debt, the trading price of our common stock could be adversely effected. Further, if we issue additional equity or debt securities, stockholders may experience dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. We are not aware of any material trend, event or capital commitment, which would or could potentially adversely affect our liquidity. We do not have any arrangements with potential investors or lenders to provide us with any additional financing and there can be no assurance that any such additional financing will be available when required in order to proceed with the business plan.

Off-Balance Sheet Arrangements

As of March 31,June 30, 2021 and December 31, 2020, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated under the Securities Exchange Act of 1934.

Critical Accounting Policies

Our significant accounting policies are described in the notes to our financial statements for the period ended March 31,June 30, 2021, and are included elsewhere in this quarterly report.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

None.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures. As of March 31,June 30, 2021, the Company’s chief executive officer and chief financial officer conducted an evaluation regarding the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act. Based upon the evaluation of these controls and procedures as provided under the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013), our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were ineffective as March 31,June 30, 2021. Management has identified corrective actions for the weakness and will periodically reevaluate the need to add personnel and implement improved review procedures during fiscal year 2021.

Changes in internal controls. During the quarterly period covered by this report, no changes occurred in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not currently subject to any material legal proceedings, nor, to our knowledge, is any material legal proceeding threatened against us. However, from time to time, we may become a party to certain legal proceedings in the ordinary course of business.

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, “Item 1. Description of Business, subheading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2020, which could materially affect our business, financial condition or future results.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURE

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable.

ITEM 6. EXHIBITS

(a) The following documents are filed as exhibits to this report on Form 10-Q or incorporated by reference herein. Any document incorporated by reference is identified by a parenthetical reference to the SEC filing that included such document.

SIGNATURES

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.