Cautionary Statement





This Management's Discussion and Analysis 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," "plan", "estimate," "anticipate," "intend,"
"project," "will," "predicts," "seeks," "may," "would," "could," "potential,"
"continue," "ongoing," "should" and similar expressions, or words which, by
their nature, refer to future events. You should not place undue certainty on
these forward-looking statements, which apply only as of the date of this Form
10-Q. These forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially from
historical results or from our predictions. We undertake no obligation to update
or revise publicly any forward-looking statements, whether because of new
information, future events, or otherwise.

Unless the context otherwise requires, all references to "we," "us," "our" or the "Company" are to MCX Technologies Corporation and our subsidiaries.

Critical Accounting Policies and Estimates





Our financial statements are prepared in accordance with generally accepted
accounting principles in the United States ("GAAP"). The preparation of these
financial statements requires us to make estimates and assumptions that affect
the reported amounts of assets, liabilities, revenue, expenses and related
disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our
estimates are based on historical experience and various other assumptions that
we believe to be reasonable under the circumstances. Our actual results could
differ from these estimates. We believe that the assumptions and estimates
associated with revenue recognition, income taxes, stock-based compensation,
research and development costs and impairment of long-lived assets have the
greatest potential impact on our financial statements. Therefore, we consider
these to be our critical accounting policies and estimates.



A description of the Company's critical accounting policies and related
judgments and estimates that affect the preparation of the Company's financial
statements is set forth in under the heading "Critical Accounting Policies and
Estimates" in Item 7, Management's Discussion and Analysis of the Company's
Annual Report on Form 10-K for the year ended December 31, 2020. With the
exception of the policy adoptions discussed in Note 3 of the Notes to the
Consolidated Financial Statements included with this report, such policies were
unchanged during the six months ended June 30, 2021.



Overview



We are currently focused on delivering digital transformation solutions to
customer-centric organizations through integrated marketing, data science,
analytics, commerce, and machine learning. In addition, we are seeking to invest
in cyber-currency and decentralized finance technologies to support the
"Always-On Economy". We were previously engaged in the more narrowly focused
business of solely delivering consulting and professional services that were
designed to help corporations improve their customer listening and customer
management capabilities, referred to as customer experience ("CX") management
solutions.



The Company formed a wholly owned subsidiary, McorpCX, LLC ("McorpCX LLC") as a
limited liability company in the state of Delaware on December 14, 2017. On
August 16, 2018, the Company entered into a contribution agreement with its
wholly owned subsidiary McorpCX LLC, pursuant to which the Company transferred
to McorpCX LLC all the Company's assets and liabilities related to the Company's
customer experience consulting business, excluding the underlying technology and
databases related thereto which remained with the Company.



Effective August 3, 2020, the Company sold all of its membership interests in
McorpCX, LLC to mfifty, LLC, a California limited liability company controlled
by Michael Hinshaw, the then current President of McorpCX LLC (the "Purchaser").
Since the Company's professional and related consulting services business, which
constituted substantially all of the Company's operations at the time of the
sale of McorpCX LLC, was conducted through McorpCX LLC, the sale of McorpCX LLC
represented a strategic shift that we believe will have a major effect on the
Company's operations and financial results.



As consideration for the sale of McorpCX LLC, the Company received a total of
$352,000 in cash consisting of $100,000 received upon the signing of the
purchase agreement and $252,000 received at the closing of the transaction along
with a $756,000 promissory note. The promissory note has an initial annual
interest rate of 0.99% (to be recalculated at the end of each twelve-month
period subsequent to the date of the note based on the annual Applicable Federal
Rate for mid-term loans on the first business day following each such
twelve-month period) accruing daily on the outstanding balance of the note, and
monthly principal payments are payable to the Company over a term of four or
more years. Monthly principal payments to the Company were initially $7,292 per
month for the first twelve months following the date of the note, and then
during each subsequent twelve-month period are based on the annual revenues of
McorpCX, LLC. On June 11, 2021, the Company and the Purchaser entered into an
amendment to the promissory note whereby the Purchaser agreed to pay the Company
One Hundred Thousand Dollars ($100,000) on or before July 1, 2021 to be applied
towards the outstanding principal amount of the promissory note and then going
forward to pay the remaining principal amount in installments of Twenty Thousand
Dollars ($20,000) each due on the first day of each month commencing on August
1, 2021 until the principal amount is paid in full, with the final payment being
the remaining unpaid outstanding balance due at that time. The amendment to the
promissory note also provides that the promissory note will be considered paid
in full if any of the following occurs: (i) the Purchaser pays at least 90% of
the outstanding balance due (principal and interest) under the promissory note
by December 31, 2021; (ii) the Purchaser pays at least 95% of the outstanding
balance due under the promissory note by June 30, 2022; and (iii) the Purchaser
pays at least 97.5% of the outstanding balance due (principal and interest)
under the promissory note by December 31, 2022. The Company has received the
initial $100,000 payment and the first $20,000 payment as of the date of this
report. . The note is secured by the Purchaser's ownership interest in McorpCX
LLC.



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The Company's management is now in the process of recreating the Company to
enable it to focus on providing technology solutions for the "Always-On
Economy". MCX is exploring investment opportunities into three areas: digital
transformation, cryptocurrency, decentralized finance ("DeFi"). In developing
our portfolio offering, we are in the process of exploring various strategic
alternatives, such as proprietary software or technology development, pursuit of
mergers/acquisitions or joint venture opportunities, "white-labeling"
arrangements, software licensing arrangements, and investment in additional
infrastructure for our Company. Each of these possible strategies will be
thoroughly vetted by our board of directors to assess the expected level of
enterprise value creation for each strategy compared to the various risks
associated with each possible scenario. In addition, we may require financing to
pursue these strategies that are beyond our current financial resources.
Accordingly, there is no assurance that we will be able to pursue any strategy
identified by our board of directors.



On November 12, 2020, the Company formed The Collective Experience, LLC in
Delaware (the "Collective Experience"). The Company is currently providing all
of its customer relations management consulting services, which is the Company's
sole revenue generating operations, through the Collective Experience.



In December 2019, a novel strain of coronavirus ("COVID-19") was reported in
Wuhan, China and has since extensively impacted the global health and economic
environment. In March 2020, the World Health Organization characterized COVID-19
as a pandemic. The COVID-19 pandemic and the government responses to the
outbreak presents uncertainty and risk with respect to the Company and its
performance and financial results.



The Company is subject to risks and uncertainties as a result of the COVID-19
pandemic. The extent of the impact of the COVID-19 pandemic on the Company's
business remains highly uncertain and difficult to predict, as the response to
the pandemic continues to evolve. Although the administration of vaccines
throughout the United States contributed to the lifting of certain restrictive
measures, and capital markets in the United States improved during the second
half of 2020 and remained relatively strong in the first half of 2021, the
re-emergence of significant increases in infection rates could result in
governments re-imposing restrictive measures that could reduce or impair
economic activity. Consequently, the COVID-19 pandemic and the government
responses to the outbreak presents continued uncertainty and risk with respect
to the Company and its performance and financial results.

We cannot assure you that we will be able to compete successfully against current or potential competitors, or that competition will not have a material adverse effect on our business, financial condition, and operations.





Sources of Revenue



Prior to the sale of McorpCX, LLC in August 2020, our revenue consisted
primarily of fees from professional and consulting services and other revenue
primarily related to the reimbursement of expenses mostly through the operations
of McopCX LLC. Product revenue was from productized and software-enabled service
sales not elsewhere classified.



As of June 30, 2021, our only source of revenue is derived from providing
digital transformation services through the Collective Experience that include
brand strategy, data science, pricing science, customer experience management
consulting and implementation in support of these strategies.



Operating Expenses



Cost of Goods Sold



Cost of goods sold consist primarily of expenses directly related to providing
professional and consulting services. Those expenses include contract labor,
third-party services, and materials and travel expenses related to providing
professional services to our clients.

General and Administrative Expenses





General and administrative expenses consist primarily of salary and related
expenses for management, client delivery, finance and accounting, and sales and
marketing. These expenses also include contract services, as well as marketing
and promotion costs, professional fees, software license fee expenses,
administrative costs, insurance, rent and a portion of travel expenses and other
overhead, which are categorized as "other general and administrative expenses"
in our consolidated financial statements. In addition, the other general and
administrative expenses include the professional fees, filing, and registration
costs necessary to meet the requirements associated with having to file reports
with the United States Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended, as well as having our stock listed on the TSX
Venture Exchange in Canada and quoted on the OTC Pink Sheets in the United
States.



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Results of Continuing Operations





Management determined that the completion of the sale of McorpCX LLC meets the
criteria for the presentation of the operations of McorpCX LLC as discontinued
operations as of August 3, 2020 and accordingly, the results of the McorpCX, LLC
are presented as discontinued operations in the Company's Consolidated
Statements of Operations beginning in the third quarter of 2020, and thus
excluded from continuing operations for all periods presented.

Revenues & Cost of Goods Sold



During the three and six months ended June 30, 2021, we had $202,606 and
309,316, respectively, in revenue recognized as well as the related cost of
goods sold of $42,998 and 120,169, respectively, generated through continuing
operations from two customer contracts entered into in the last quarter of 2020
plus an additional 4 customer contracts entered into in 2021. There was no
revenue or cost of goods sold generated through continuing operations for the
three and six months ended June 30, 2020.

Change from Percent Change


              Net Loss                     2021           2020         Prior Year        from Prior Year
Three Months Ended June 30,             $  (41,927 )   $  (35,636 )   $      (6,291 )                  18 %
Six Months Ended June 30,               $ (109,320 )   $ (201,487 )   $      92,167                   (46 %)




Net loss increased to $41,927 for the three months ended June 30, 2021 from a
net loss of $35,636 for the three months ended June 30, 2020 mostly as a result
of a reduction in net operating loss from continuing operations of $163,187 in
the second quarter of 2021 compared to the same quarter of 2020 being more than
offset by $169,478 in income from discontinued operations in the second quarter
of 2020. Net loss decreased to $109,320 for the six months ended June 30, 2021
from a net loss of $201,487 for the six months ended June 30, 2020. The decrease
in net loss in the first half of 2021 compared to same period of 2020 was
primarily a result of revenue generated in 2021 from new operations combined
with fewer salaried employees, less professional fees and no consulting services
or travel expenses being partially offset by expenses associated with finance
and administration services provided by contractors in the first half of 2021
compared to the same period of 2020.



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                                                         Change from       Percent Change
    Salaries and Wages          2021         2020        Prior Year       from Prior Year
Three Months Ended June 30,   $ 15,557     $ 17,428     $      (1,871 )                (11 %)
Six Months Ended June 30,     $ 31,114     $ 46,359     $     (15,245 )                (33 %)




Expenses attributable to salaries and wages for the three months ended June 30,
2021 and 2020 primarily consisted of stock compensation expense.  The decrease
in expenses attributable to salaries and wages in the second quarter of 2021
compared to the same quarter of 2020 was primarily due to the elimination of
executive officer salaries and the outsourcing of all staff salaries due to the
Company's internal finance and administration services being provided by
contractors in 2021.



Expenses attributable to salaries and wages primarily consisted of stock
compensation expense for the six months ended June 30, 2021 and 2020.  The
decrease in expenses attributable to salaries and wages in the first half of
2021 compared to the same period of 2020 was primarily due to the elimination of
executive officer salaries and the outsourcing of all staff salaries due to the
Company's internal finance and administration services being provided by
contractors in 2021.



                                                       Change from       Percent Change
     Contract Services          2021        2020       Prior Year       from Prior Year
Three Months Ended June 30,   $  52,265     $   -     $      52,265                  100 %
Six Months Ended June 30,     $ 104,261     $   -     $     104,261                  100 %




Contract services expenses increased during the three and six months ended June
30, 2021 and 2020, due to executive, finance and administration services being
provided by contractors in 2021, which were provided by salaried employees in
2020.



                                                                       Change from       Percent Change
  Other General and Administrative         2021           2020         Prior Year       from Prior Year
Three Months Ended June 30,             $  134,179     $  189,797     $     (55,618 )                (29 %)
Six Months Ended June 30,               $  166,590     $  318,283     $    (151,693 )                (48 %)

Other general and administrative costs decreased by $55,618 and $151,693 during the three and six months ended June 30, 2021 compared same periods in 2020 primarily due to decreases in professional fees in 2021 compared to 2020.





                                                        Change from       Percent Change
  Other Income (Expense)       2021         2020        Prior Year       from Prior Year
Three Months Ended June 30,   $   466     $  2,111     $      (1,645 )                 78 %
Six Months Ended June 30,     $ 3,498     $ (8,464 )   $      11,962                 (141 %)




Other income decreased to $466 in the three months ended June 30, 2021 compared
to $2,111 in other income in the three months ended June 30, 2020 primarily due
to the incurrence of some non-recurring expenses coupled with slightly lower
interest income from the prior year.



We recognized $3,498 in other income in the six months ended June 30, 2021
compared to $8,464 in other expense in the six months ended June 30, 2020
primarily due to decreases in state use tax expenses, interest on related party
notes receivable, as well as the correction of cash reconciliation items booked
during the first half of 2020.



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Liquidity and Capital Resources

We measure our liquidity in a variety of ways, including the following:





                            June 30,       December 31,
                              2021             2020
Cash and cash equivalents   $ 108,846     $      297,965
Working capital             $  79,184     $      114,499




Anticipated Uses of Cash

As of June 30, 2021, our cash and cash equivalents and working capital had decreased to $108,846 and $79,184 from $297,965 and $114,499, respectively, as of December 31, 2020.





For the six months ended June 30, 2021 and the year ended December 31, 2020, we
were able to finance our operations with cash generated through cash on hand as
well as proceeds of the sale of McorpCX, LLC. The accompanying consolidated
financial statements have been prepared in accordance with GAAP applicable to a
going concern, which contemplates the realization of assets and the satisfaction
of liabilities and commitments in the normal course of business.



During the six months ended June 30, 2021, our primary uses of cash included
cash paid to professional staff to support our consulting services, general and
administrative support and new business development activities.



We currently plan to fund our expenditures with cash on hand as well as cash
flows generated from new revenue sources as a digital transformation company. If
needed, the possibility may exist to raise additional capital through debt
financing and common stock sales. We do not intend to pay dividends in the
foreseeable future. In addition to the working capital position of the Company,
we are seeking new sources of revenue to fund our capital requirements for our
business during the next 12 months.



We received total consideration of $1,108,000 consisting of $352,000 in cash and
a $756,000 promissory note for the sale of McorpCX, LLC, which was completed on
August 3, 2020.



We intend to continue to seek ways to expand upon our business and as such, in
the future we may make acquisitions of businesses or assets or commitments to
additional capital projects. To achieve the long-term goals of expanding our
assets and earnings, including through acquisitions, capital resources may be
required. Depending on the size of a transaction, the capital resources that may
be required could be substantial. The necessary resources may be generated from
cash flow from operations, cash on hand, borrowing against our assets or the
issuance of securities, and there is no assurance these capital resources will
be available to us when required.

Cash Flow - Six months ended June 30, 2021 and 2020





The cash flows related to discontinued operations have not been segregated and
are included in the Consolidated Statements of Cash Flows. There were no
significant capital expenditures and operating noncash items for any periods
presented.



Operating Activities. Net cash used in operating activities decreased to
$232,871 for the six months ended June 30, 2021 compared to net cash used in
operating activities of $294,064 for the six months ended June 30, 2020. This
decrease in cash used in operating activities in 2021 compared to 2020 was
primarily due to a decrease in net loss, being partially offset by an increase
in accounts receivable and a decrease in deferred revenue in the first six
months of 2021 compared to the same period of 2020.



Investing Activities. $43,752 in cash received as interest and principal
payments on the promissory note from the Purchaser constituted all of the cash
provided by investing activities for six months ended June 30, 2021. There was
no cash provided by, or used in, investing activities for the six months ended
June 30, 2020.



Financing Activities. There was no cash provided by, or used in, financing
activities for the six months ended June 30, 2021. For the six months ended June
30, 2020, the Company had cash provided by financing activities of $311,069 due
to proceeds from two promissory notes issued to McorpCX, LLC.  As a result of
the sale of McorpCX LLC on August 3, 2020, these notes are no longer a liability
of the Company.

Results of Discontinued Operations





                                                                            Change from       Percent Change
Total income from discontinued operations      2021            2020         Prior Year       from Prior Year
Three Months Ended June 30,                 $         -     $  169,478     $    (169,478 )               (100 %)
Six Months Ended June 30,                   $         -     $  171,619     $    (171,619 )               (100 %)




There was no income from discontinued operations during the three or six months
ended June 30, 2021. During the three and six months ended June 30, 2020, total
income from discontinued operations was $169,478 and $171,619, respectively.

Off Balance Sheet Arrangements

We did not have any off-balance sheet arrangements as of June 30, 2021.


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