EESTOR CORPORATION

MANAGEMENT’S DISCUSSION & ANALYSIS

FOR THE YEAR ENDED SEPTEMBER 30, 2018

DISCUSSION DATED: JANUARY 25, 2019

Cash Flow

At September 30, 2018, the Company had cash of $648,034 compared to $2,019,420 of cash at September 30, 2017. The decrease in cash of $1,371,386 resulted from outflows in operating activities and investing activities of $4,560,275 and $163,332, respectively offset by a cash inflow of $3,352,221 from financing activities.

Operating activities were affected by adjustments of depreciation and amortization of $110,511, stock-based compensation of $845,232, gain on sale of equipment of $11,232 and loss on disposal of asset held for sale of $7,510 and asset impairment of $2,736. Net change in non-cash working capital balances of $256,426 resulted from a decrease in prepaid expenses and sundry assets of $30,800 and an increase in accounts payable and accrued liabilities of $225,626.

The Company used $163,332 for investing activities to purchase $112,760 of equipment, $76,796 for the prosecution and maintenance of patents and trademarks and received $11,234 and $14,990 from the sale of equipment and an asset held for sale, respectively.

The Company received $3,352,221 from financing activities by raising $3,314,721 from the private placement of units, net of issuance costs and $37,500 for warrants exercised.

Liquidity and Financial Position

The Company is an early-stage development corporation and accordingly has not generated revenues from its technology. The Company has incurred a significant accumulated deficit to date of $68,970,412 (September 30, 2017 – deficit of $64,614,569). The ability of the Company to continue operations is dependent upon obtaining sufficient funding to sustain operations through the development stage, successfully bring its technologies to market and achieving profitable operations. The Company manages its capital, which consists of cash provided from financing, with the primary objective being safeguarding sufficient working capital to sustain operations. The Board has not established capital benchmarks or other targets.

The Company is not subject to any capital requirements imposed by a lending institution or regulatory body, other than Policy 2.5 of the TSXV which requires adequate working capital or financial resources of the greater of (i) $50,000 and (ii) an amount required in order to maintain operations and cover general and administrative expenses for a period of 6 months. As of September 30, 2018, the Company is not compliant with TSXV Policy 2.5 but is currently in the process of raising additional funds through equity financing.

During fiscal 2019, the Company’s corporate head office costs are estimated to average $250,000 per quarter. Head office costs include professional fees, reporting issuer costs, business development costs and general and administrative costs. The engineering and development costs of the Company are estimated to average $500,000 per quarter.

As at September 30, 2018, the Company had cash and cash equivalents of $648,034 ($2,019,420 at September 30, 2017). The Company will need to obtain additional financial resources through operations, additional equity and/or debt financing, or by licensing technology for cash proceeds to fund its activities for fiscal 2019 and beyond.

The Company will pursue additional funding through the issuance of additional equity or debt financing. The Company’s short-term plans are dependent on its ability to access funding to continue operations and develop its technology. If the Company is unable to obtain funding through the issuance of common shares, warrants or stock options exercised, issuance of debt, or proceeds from a licensing arrangement in a timely manner, then these programs and operations in general could be delayed or cease altogether.