Global Future City Holding Inc.

As discussed in Note 7, on April 21, 2017, we entered into amendment agreements with three note holders holding notes with face values totaling $150,000 to extend the due dates of their notes to July 30, 2017 in exchange for our issuance to each holder of 75,000 restricted shares of our common stock. The shares will be valued at their relative fair market value on the issue date of each note (the date the share obligation arose) and we will record a debt discount for that amount. The debt discount will be amortized through July 30, 2017.

Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934).  Forward-looking statements are, by their very nature, uncertain and risky. These risks and uncertainties include international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other risks that might be detailed from time to time in our filings with the Securities and Exchange Commission.

Although the forward-looking statements in this report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them.  Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements.  You are urged to carefully review and consider the various disclosures made by us in this report and in our other reports as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects.

General and administrative expenses for the three months ended March 31, 2017 and 2016 were $495,442 and $1,113,467, respectively. The reduction of $618,025 resulted primarily from two cost categories. In the 2016 period, our professional fees and consulting expenses were approximately $468,000 higher than the 2017 period due to the commencement and growth of our direct selling program. In addition, the 2016 period costs for investor relations expense were approximately $162,000 higher than in 2017 due to our capital raising efforts in the prior year. The 2016 period investor relations costs include $138,570 of stock-based expenses. The 2017 expenses include a loss on disposal of fixed assets related to Mr. Liu and his staff.

Reserve – Due from Related Party

During the first quarter of 2017, we made payments of $7,021 on behalf of Great Coin in connection with their development of a trading platform for the GX Coin, a digital currency we wished to use in a rewards program for our GX-Life Direct Selling Program. As discussed in Note 1, we have suspended this program and fully impaired the $7,021. We will continue to pursue collection of all amounts due us from Great Coin, but it is unclear whether any of the amounts will be collectible given Great Coin’s inability to raise capital or generate transactional activity.