The following discussion is intended to assist you in understanding our business and the results of our operations. It should be read in conjunction with the Condensed Financial Statements and the related notes that appear elsewhere in this report as well as our Report on Form 10K filed with the Securities and Exchange Commission for the period ending December 31, 2019. Statements made in this Form 10-Q that are not historical or current facts are "forward-looking statements". These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.





Company History

CyberloQ Technologies Inc. ("CLOQ", 'We" or the "Company") was incorporated in Nevada on February 25, 2008 as Advanced Credit Technologies, Inc. On November 20, 2019, the Company changed its name from Advanced Credit Technologies, Inc. to CyberloQ Technologies, Inc. The Company has never been the subject of any bankruptcy, receivership or similar proceeding. The Company has never been involved in any material reclassification, merger, or consolidation.

On June 15, 2017, the Company created a private limited company in the United Kingdom named CyberloQ Technologies LTD. CyberloQ Technologies LTD is a wholly-owned subsidiary of the Company, and any business that the Company has in the United Kingdom will be transacted through CyberloQ Technologies LTD. However, to date CyberloQ Technologies LTD has had no activity, operational or otherwise.

Current Overview of the Company

CyberloQ Technologies Inc. is a development-stage technology company focused on fraud prevention and credit management. The Company offers a proprietary software platform branded as CyberloQ®. While previously the Company licensed CyberloQ, in the third quarter of 2017, the Company acquired the CyberloQ technology and is now the exclusive owner of CyberloQ.

CyberloQ is a banking fraud prevention technology that is offered to institutional clients in order to combat fraudulent transactions and unauthorized access to customer accounts. Through the use of a customer's smart-phone, CyberloQ uses a multi-factor authentication system to control access to a bank card, transaction type or amount, website, database or digital service. The mobile applications for CyberloQ have been built, and have been successfully integrated into the banking ecosystem.

The Company also has a product named CyberloQ Vault which is a "cloud based' security protocol that allows clients the ability to send/receive secure data without having to use traditional e-mail which is prone to breach. This service uses cloud-based encryption and a secure web portal to send/receive confidential data. Both the sender and receiver must have authenticated their position within the prescribed geo-coordinates as well as authenticate their mobile devices prior to sending/receiving any data, rendering a hack or breach utterly useless since the encrypted data is unusable without the CyberloQ authentication component.





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Moreover, the Company is able to develop secure databases for clients by developing and attaching a private blockchain to the SQL database and further securing the database through use of the Company's CyberloQ technology. The blockchain being developed by the Company is a private blockchain and is an invitation-only network governed by a single entity. Entrants to the network require permission to read, write or audit the blockchain.

Finally, the Company offers a web-based proprietary software platform under the brand name Turnscor® which allows customers to monitor and manage their credit from the privacy of their own homes.

The Company currently has three officers - its President, Vice-President and Chief Technology Officer. The Company does not have other employees of the Company at this time.

Liquidity, Capital Resources and Material Changes in Financial Condition

As of September 30, 2020, the Company's assets were $438,399 compared to $485,346 in assets as of December 31, 2019. The change in the Company's financial condition can be attributed to $92,006 in depreciation expense which reduced the Company's fixed assets from $444,410 to $352,404 along with an increase in current assets from $40,936 to $125,995. Additionally, a previously recorded receivable in the amount of $40,000 was written off during the quarter.

As of September 30, 2020, the Company's liabilities were $300,851 compared to $144,904 in liabilities as of December 31, 2019. This change in the Company's financial condition was due to an increase of $38,844 in accounts payable and accrued expenses, along with a decrease of $14,589 in customer prepayments, and an increase in Note payable from related parties from $30,000 to $125,000. Additionally, the Company received an Economic Injury Disaster Loan payment in the amount of $35,600 that was recorded as a Long-Term Loan payable.

Net cash used in operating activities for the nine month period ending September 30, 2020 was $222,907 compared to $287,422 for 2019. Cash provided by or used by operating activities is driven by our net loss and adjusted by non-cash items as well as changes in operating assets and liabilities. Non-cash adjustments for the nine months ended September 30, 2020 include depreciation of $92,006, stock compensation of $36,140,loss on extinguishment of debt of $120,000 and bad debt of $40,000.

Net cash used by investing activities was $0 for the nine months ended September 30, 2020 as compared to $15,750 for 2019.

Net cash provided by financing activities was $307,266 for the nine months ended September 30, 2020 as compared to $305,000 for 2019.

The Company had gross revenue of $3,807 and $19,916 for the three and nine months ended September 30, 2020 compared to gross revenue of $22,814 and 95,699 for the three and nine months ended September 30, 2019, and is currently reliant on its ability to raise additional capital to continue execution of its business plan to move the Company forward towards profitability. The Company does not anticipate any significant decrease in its operating expenses for the remainder of 2020. Unless the Company begins to generate operational revenue, it will be reliant on its ability to raise additional capital in order to continue its operations.

Results of Operations for the Three and nine Months Ended September 30, 2020 and 2019

Company revenue was $3,807 and $19,916 in the three and nine months ended September 30, 2020 as compared to $22,814 and $95,699 for the three and nine months ended September 30, 2019, and the Company's operating expenses were $190,145 and $437,522 for the three and nine months ended September 30, 2020 as compared to $138,019 and 460,699 for the three and nine months ended September 30, 2019.





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The decrease in operating expenses for the three and nine months ended September 30, 2020 as compared to September 30, 2019 was due to a decrease in all but two expense categories, stock compensation expense and bad debt expense. The Company experienced changes in expense categories as noted below.

Professional fees were $14,795 and $43,164 for the three and nine months ended September 30, 2020, compared to $9,711 and $53,393 for the three and nine months ended September 30, 2019. This decrease in professional fees was due to decreased audit fees during the quarter.

Research expenses were $0 and $2,100 for the three and nine months ended September 30, 2020, compared to $0 and $6,193 for the three and nine months ended September 30, 2019. This decrease in research was due to costs incurred in 2019 associated with updates to the Company's website.

Stock compensation expenses were $28,140 and $36,140 for the three and nine months ended September 30, 2020, compared to $0 and $18,570 for the three and nine months ended September 30, 2019.

Travel and entertainment expenses were $1,705 and $1,784 for the three and nine months ended September 30, 2020, compared to $2,480 and $27,535 for the three and nine months ended September 30, 2019. This decrease in travel and entertainment expenses was due to decreased business travel during 2020.

Computer and internet expenses were $1,696 and $6,376 for the three and nine months ended September 30, 2020 as compared to $5,096 and $14,870 for the three and nine months ended September 30, 2019. This decrease was due to lower hosting costs associated with the Company's private blockchain product.

Office supplies and expenses were $646 and $4,134 for the three and nine months ended September 30, 2020, compared to $1,119 and $4,489 for the three and nine months ended September 30, 2019.

Other operating expenses were $2,408 and $5,000 for the three and nine months ended September 30, 2020 as compared to $1,235 and 11,349 for the three and nine months ended September 30, 2019. This decrease was due to lower advertising costs.

Additionally, there was a bad debt recognized on accounts receivable in the amount of $40,000. The expense was recognized at September 30, 2020, when it was deemed by the Company that the outstanding amount from Diabetic Help Centers was no longer recoverable.

As a result of the foregoing, the Company experienced a net loss from operations of $186,338 and $417,606 in the three and nine months ended September 30, 2020 compared to a net loss from operations of $115,205 and $365,000 in the three and nine months ended September 30, 2019.

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