Live Current Media Inc. - Annual Report: 2020 (Form 10-K)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)

☒  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

          For the fiscal year ended December 31, 2020

☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

          For the transition period from ________ to ________

COMMISSION FILE NUMBER 000-29929

LIVE CURRENT MEDIA, INC.

(Exact name of registrant as specified in its charter)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act. 
[__] Yes  [X] No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

[__] Yes  [X] No

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. 
[ X ] Yes [___] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (s. 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

[ X ] Yes  [___] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

[__]

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

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter: $1,621,540 based on the closing price of $0.094 on June 30, 2020 as quoted by the OTCQB Marketplace on that date.

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.  As of March 30, 2021 the Registrant had 34,837,625 shares of common stock outstanding.

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LIVE CURRENT MEDIA, INC.

ANNUAL REPORT ON FORM 10-K

FOR THE YEAR ENDED DECEMBER 31, 2020

TABLE OF CONTENTS

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PART I

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this registration statement constitute "forward-looking statements." These statements, identified by words such as "plan," "anticipate," "believe," "estimate," "should," "expect" and similar expressions include the Company's expectations and objectives regarding its future financial position, operating results and business strategy. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause its actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, general economic conditions particularly related to demand for the Company's products and services, changes in business strategy, competitive factors (including the introduction or enhancement of competitive services), pricing pressures, changes in operating expenses, fluctuation in foreign currency exchange rates, inability to attract or retain consulting, sales and/or development talent, changes in customer requirements, and/or evolving industry standards, as well as those factors discussed in "Part II, Item 1A. Risk Factors" of this annual report on Form 10-K.

Forward looking statements are based on a number of material factors and assumptions, including the availability and final receipt of required government licenses, that sufficient working capital is available to complete the proposed activities, that contracted parties provide goods and/or services on the agreed time frames. While the Company considers these assumptions may be reasonable based on information currently available to it, they may prove to be incorrect. Actual results may vary from such forward-looking information for a variety of reasons, including but not limited to risks and uncertainties disclosed in "Part II, Item 1A. Risk Factors" of this annual report on Form 10-K.

The Company intends to discuss in their Quarterly Reports and Annual Reports any events or circumstances that occurred during the period to which such documents relate that are reasonably likely to cause actual events or circumstances to differ materially from those disclosed in this registration statement. New factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of each such factor on its business or the extent to which any factor, or combination of such factors, may cause actual results to differ materially from those contained in any forwarding looking statement.

As used in this registration statement, unless the context otherwise requires, "we," "us," "our," the "Company" and "Live Current" refers to Live Current Media, Inc. All dollar amounts in this registration statement are in U.S. dollars unless otherwise stated.

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ITEM 1. BUSINESS

General

Live Current Media, Inc. (the "Company") was incorporated under the laws of the State of Nevada on October 10, 1995.  The Company has an authorized capital of 500,000,000 shares of common stock with 34,837,625 shares currently issued and outstanding.

The Company is the sole shareholder of Domain Holdings Inc., originally formed under the laws of British Columbia, Canada on July 4, 1994 and re-domiciled to Alberta, Canada on April 14, 1999 ("DHI").  The Company is also the majority shareholder of Perfume, Inc. (95% ownership), formed under the laws of the State of Delaware on March 13, 2008.  Perfume, Inc. is currently dormant and does not carry on an active business.  References herein to the Company include DHI and Perfume, Inc. (collectively, the "Subsidiaries") unless otherwise stated.

On March 21, 2019, the Company executed a distribution agreement (the "Distribution Agreement") with Cell MedX Corp. ("Cell MedX" or the "Device Manufacturer"), pursuant to which Cell MedX granted to the Company exclusive worldwide rights to distribute the eBalance microcurrent device to households and individual users. 

On January 29, 2020 the Company and CMXC entered a Buyback agreement to sell the exclusive distribution rights to the eBalance microcurrent device back to CMXC.

Live Current is a digital technology company involved in the entertainment industry.  Live Current is currently developing SPRT MTRX, which are positioned in the sports/gaming sector and eSports sector.

Distribution of Cell MedX eBalance Devices

On January 29, 2020 the Company entered into an agreement to sell the Distribution Rights back to Cell MedX.  Under the terms of the agreement, the Company sold the Distribution Rights back to Cell MedX in consideration for a royalty on future sales of the eBalance device capped at US$507,500, plus warrants to purchase up to 2,000,000 shares in the common stock of Cell MedX (the "Warrants") exercisable for a period of three (3) years.  1,000,000 of the Warrants are exercisable at a price of $US0.50 per share (the "$0.50 Warrants"), with the remaining 1,000,000 Warrants exercisable at US$1.00 per share (the "$1.00 Warrants").  The Warrants are subject to an acceleration right, with the $0.50 Warrants being subject to acceleration if Cell MedX's common stock trades at or above $1.00 per share for 30 consecutive trading days, and the $1.00 Warrants being subject to acceleration if Cell MedX's common stock trades at or above $1.75 per share for 30 consecutive trading days.  Cell MedX may buyout the royalty at any time during the first twelve months following the effective date of the agreement for 85% of the remaining amount of the royalty still payable.

Subsequent to our entry into the Cell MedX Distribution Agreement and the Cell MedX Buyback Agreement, in June 2020, John da Costa, a director of the Company was appointed as the Chief Operating Officer and a member of the board of directors of Cell MedX Corp.

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Gaming

Market.  70% of Americans play games online.  54% of those gamers are male, 46% are female and 52% are college educated.  60% play on their mobile devices.  Gamers play for mental stimulation, relaxation and stress relief, while prize money is a major inducement.

In addition, gaming advertising revenue has doubled in the last two years.  The most common platform for playing games is the smartphone leaving no doubt as to why gaming is taking off.  72% of revenue generated from the App Store is generated from gaming apps.

SPRT MTRX

SPRT MTRX is a gaming app, available in both iPhone and Android versions, in which players bid on the final scores of NHL, NFL and NBA games.  The events are organized as "Challenges" and cover multiple games over one day.  A cash prize is awarded to the player who receives the most points for correctly bidding on the final scores of the sports events included in the Challenge.  The system for bidding on the final scores is unique in the gaming industry.

Business Model.  The business model entails offering free prizes for playing the game, developing a large contingent of users and delivering advertisements.  This model has proven popular among gamers as the lure of free money is a very attractive inducement.  In addition, in-app purchases in the form of sports data and bidding preferences will be added in the future.

Development.  The Company will continue to develop and enhance the SPRT MTRX through 2021 by adding additional functionality including news and trivia and more sports such as MLB and EPL but does not anticipate generating any significant revenue from SPRT MTRX in fiscal 2021.

Boxing.com FEDERATION

The Company was developing Boxing.com Federation during the 2020 fiscal year. Subsequent to the year end in, March 2021 the Company terminated development of this project.

ITEM 1A. RISK FACTORS

An investment in the Company's common shares involves a high degree of risk.  You should carefully consider the risks described below and the other information in this registration statement before investing in its common shares. If any of the following risks occur, the Company's business, operating results and financial condition could be seriously harmed. The trading price of its common shares could decline due to any of these risks, and you may lose all or part of your investment.

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You should consider each of the following risk factors and the other information in this registration statement, including the Company's financial statements and the related notes, in evaluating its business and prospects. The risks and uncertainties described below are not the only ones that impact on the Company's business. Additional risks and uncertainties not presently known to the Company or that the Company currently consider immaterial may also impair its business operations.  If any of the following risks do occur, its business and financial results could be harmed. In that case, the trading price of its common stock could decline.

Risks Associated with the Company's Gaming Business

Licensing.  Currently, other than business and operations licenses applicable to most commercial ventures, the Company is not required to obtain any governmental approval for its business operations.  There can be no assurance, however, that governmental institutions will not, in the future, impose licensing or other requirements on the Company.  Additionally, as noted below, there are a variety of laws and regulations that may, directly or indirectly, have an impact on the Company's business.

Privacy Legislation and Regulations.  While the Company is not currently subject to licensing requirements, entities engaged in operations over the Internet, particularly relating to the collection of user information, are subject to limitations on their ability to utilize such information under federal and state legislation and regulation. In 2000, the Gramm-Leach-Bliley Act required that the collection of identifiable information regarding users of financial services be subject to stringent disclosure and "opt-out" provisions. While this law and the regulations enacted by the Federal Trade Commission and others relates primarily to information relating to financial transactions and financial institutions, the broad definitions of those terms may make the businesses entered into by the Company and its strategic partners subject to the provisions of the Act. This, in turn, may increase the cost of doing business and make it unattractive to collect and transfer information regarding users of services. This, in turn, may reduce the revenues of the Company and its strategic partners, thus reducing potential revenues and profitability. Similarly, the Children On-line Privacy and Protection Act ("COPPA") imposes strict limitations on the ability of Internet ventures to collect information from minors. The impact of COPPA may be to increase the cost of doing business on the Internet and reducing potential revenue sources. The Company may also be impacted by the US Patriot Act, which requires certain companies to collect and provide information to United States governmental authorities. A number of state governments have also proposed or enacted privacy legislation that reflects or, in some cases, extends the limitations imposed by the Gramm-Leach-Bliley Act and COPPA. These laws may further impact the cost of doing business on the Internet and the attractiveness of Live Current's inventory of domain names.

Advertising Regulations.  In response to concerns regarding "spam" (unsolicited electronic messages), "pop-up" web pages and other Internet advertising, the federal government and a number of states have adopted or proposed laws and regulations which would limit the use of unsolicited Internet advertisements. While a number of factors may prevent the effectiveness of such laws and regulations, the cumulative effect may be to limit the attractiveness of effecting and promoting sales on the Internet, thus reducing the value of the Company's advertising driven revenue model.

There are currently few laws or regulations that specifically regulate communications or commerce on the Internet.  However, laws and regulations may be adopted in the future that address issues such as user privacy, pricing and the characteristics and quality of products and services.  For example, the Telecommunications Act of 1996 sought to prohibit transmitting various types of information and content over the Internet.  Several telecommunications companies have petitioned the Federal Communications Commission to regulate Internet service providers and on-line service providers in a manner similar to long distance telephone carriers and to impose access fees on those companies.  This could increase the cost of transmitting data over the Internet.  Moreover, it may take years to determine the extent to which existing laws relating to issues such as intellectual property ownership, libel and personal privacy are applicable to the Internet.  Any new laws or regulations relating to the Internet or any new interpretations of existing laws could have a negative impact on Live Current's business and add additional costs to doing business on the Internet.

Competition.  The Company competes with many companies possessing greater financial resources and technical facilities than itself in the B2C (business-to-consumer) market as well as for the recruitment and retention of qualified personnel. In addition, some of these competitors have been in business for longer than Live Current and may have established more strategic partnerships and relationships than the Company.

Dependence on One or a Few Major Customers.  The Company does not currently depend on any single customer for a significant proportion of its business. However, as the Company enters into strategic transactions, the Company may choose to grant exclusive rights to a small number of parties or otherwise limit its activities that could, in turn, create such dependence. The Company, however, has no current plans to do so.

Patents, Trademarks and Proprietary Rights.  On November 16, 2007, The Company filed a trademark application with the US Patent & Trademark Office ("USPTO") for the mark "LIVE CURRENT".  A certificate of registration was issued on October 14, 2008 and the mark was assigned registration number 3,517,876.

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The Company will consider seeking further trademark protection for its online businesses, however, the Company may be unable to avail itself of trademark protection under United States laws. Consequently, the Company will seek trademark protection only where it has determined that the cost of obtaining protection, and the scope of protection provided, results in a meaningful benefit to the Company.

Market Acceptance.  SPRT MTRX is a new product in a product abundant gaming market and there is no guarantee that they will be accepted by the market.  In addition to acceptance, should they be accepted, there is no guarantee that they will maintain their popularity in a notoriously fickle gaming market.

Suspension of Live, Professional Sports.  SPRT MTRX relies on live, professional sports to provide game content.  Without live professional sports, SPRT MTRX will be forced to change its business model.  This could possibly include developing artificial intelligence induced content.  There could be significant costs associated with this change and there is no guarantee that it would meet with public acceptance.

Risks Related to the Company's Securities

Additional financing will be required. The Company anticipates that it will require significant additional financing to fund its proposed business development plans. The costs of developing the Company's platforms is anticipated to be substantially greater than the Company's existing financial resources, and the Company anticipates that it will require substantial financing to develop and operate its businesses over the next 12 months.

If the Company is unable to obtain additional financing when needed, the Company may not be able to complete its business development plans or its business could fail.  The Company will scale back its development plans depending upon its existing financial resources.

The Company's ability to obtain future financing will be subject to a number of factors, including the variability of the global economy, investor interest in our planned business projects, and the performance of equity markets in general. These factors may make the timing, amount, terms or conditions of additional financing unavailable to the Company. If the Company is not able to obtain financing when needed or in an amount sufficient to enable us to complete our programs, the Company may be required to scale back its business development plans.

If additional financings equity financing will dilute existing stockholders. The most likely source of future financing presently available to the Company is through the sale of shares of its common stock. Issuing shares of common stock, for financing purposes or otherwise, will dilute the interests of existing stockholders.

The Company's stock price is volatile.  The stock markets in general, and the stock prices of internet companies in particular, have experienced extreme volatility that often has been unrelated to the operating performance of any specific public company.  The market price of the Company's Common Stock is likely to fluctuate in the future, especially if the Company's Common Stock is thinly traded.  Factors that may have a significant impact on the market price of the Company's Common Stock include:

(a) actual or anticipated variations in the Company's results of operations;

(b) the Company's ability or inability to generate new revenues;

(c) increased competition;

(d) government regulations, including internet regulations;

(e) conditions and trends in the internet industry;

(f) proprietary rights; or

(g) rumors or allegations regarding the Company's financial disclosures or practices.

The Company's stock price may be impacted by factors that are unrelated or disproportionate to its operating performance. These market fluctuations, as well as general economic, political and market conditions, such as recessions, interest rates or international currency fluctuations may adversely affect the market price of the Company's Common Stock.

The Company does not expect to pay dividends in the foreseeable future.  The Company has never paid cash dividends on its Common Stock and has no plans to do so in the foreseeable future.  The Company intends to retain earnings, if any, to develop and expand its business.

"Penny Stock" rules may make buying or selling the Company's Common Stock difficult, and severely limit its market and liquidity.  Trading in The Company's Common Stock is subject to certain regulations adopted by the SEC commonly known as the "penny stock" rules.  The Company's Common Stock qualifies as penny stocks and are covered by Section 15(g) of the Securities Exchange Act of 1934, which imposes additional sales practice requirements on broker/dealers who sell the Common Stock in the aftermarket.  The "penny stock" rules govern how broker-dealers can deal with their clients and "penny stocks".  For sales of The Company's Common Stock, the broker/dealer must make a special suitability determination and receive from you a written agreement prior to making a sale to you.  The additional burdens imposed upon broker-dealers by the "penny stock" rules may discourage broker-dealers from effecting transactions in The Company's Common Stock, which could severely limit their market price and liquidity of its Common Stock.  This could prevent you from reselling your shares and may cause the price of the Common Stock to decline.

Lack of operating revenues.  The Company has limited operating revenues and is expected to continue to do so for the foreseeable future.  Management has assessed the Company's ability to continue as a going concern and the financial statements included with this registration statement includes disclosure that there is a substantial doubt as to the Company's ability to continue as a going concern.  The audit report of the Company's principal independent accountants for the years ended December 31, 2020 and December 31, 2019 includes a statement regarding the uncertainty of the Company's ability to continue as a going concern.  The Company's failure to achieve profitability and positive operating revenues could have a material adverse effect on its financial condition and results of operations, and could cause the Company's business to fail.

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No assurance that forward-looking assessments will be realized.  The Company's ability to accomplish their objectives and whether or not they are financially successful is dependent upon numerous factors, each of which could have a material effect on the results obtained. Some of these factors are in the discretion and control of management and others are beyond management's control. The assumptions and hypotheses used in preparing any forward-looking assessments contained herein are considered reasonable by management. There can be no assurance, however, that any projections or assessments contained herein or otherwise made by management will be realized or achieved at any level.

Uncertainty due to Global Outbreak of COVID-19. In March of 2020, the World Health Organization declared an outbreak of COVID-19 a global pandemic. The COVID-19 has impacted a vast array of businesses through the restrictions put in place by most governments internationally, including the USA federal government as well as provincial and municipal governments, regarding travel, business operations and isolation/quarantine orders. At this time, it is unknown to what extent the impact of the COVID-19 outbreak may have on the Company as this will depend on future developments that are highly uncertain and that cannot be predicted with confidence. These uncertainties arise from the inability to predict the ultimate geographic spread of the disease, and the duration of the outbreak, including the duration of travel restrictions, business closures or disruptions, and quarantine/isolation measures that are currently, or may be put, in place world-wide to fight the virus. While the extent of the impact is unknown, the COVID-19 outbreak may hinder the Company's ability to raise financing for operating costs due to uncertain capital markets, supply chain disruptions, increased government regulations and other unanticipated factors, all of which may also negatively impact the Company's business and financial condition.

ITEM 2. PROPERTIES

The Company does not currently have any interests in any real property.

The Company and its Subsidiaries operate from their principal office at 50 West Liberty Street, Suite 880, Reno, Nevada. The Company's telephone number is (604) 648-0500.

ITEM 3. LEGAL PROCEEDINGS

Wrongful Dismissal Proceedings with Former CEO of DHI

On March 9, 2000, a former Chief Executive Officer of DHI commenced a legal action against DHI for wrongful dismissal and breach of contract.  He is seeking, at a minimum, 18.39% of the outstanding shares of DHI, specific performance of his contract, special damages of approximately $30,000, aggravated and punitive damages, interest and costs. On June 1, 2000, DHI filed a defense and counterclaim claiming damages and special damages for breach of fiduciary duty and breach of his employment contract. The plaintiff has taken no further action.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Holders of the Company's Shares

As of the date of this Annual Report, the Company had 71 registered shareholders.  The number of registered shareholders does not include shareholders holding their shares on deposit with brokers or dealers and registered in the name of stock depositories.

Market Information

The Company's common shares trade over-the-counter in the United States on the OTCQB marketplace under the symbol "LIVC."  The following is the high and low bid information for the Company's common stock during each fiscal quarter of its last two fiscal years on the OTCQB marketplace.

Bid quotations entered on the OTCQB marketplace reflect inter-dealer prices, without retail mark-up, markdown or commission and may not represent actual transactions.

Dividend Rights

There are no provisions in the Company's articles of incorporation or bylaws restricting the Company's ability to pay dividends on our common stock.  Chapter 78 of the Nevada Revised Statutes (the "NRS") does provide certain limitations on the Company's ability to declare and pay dividends.  Section 78.288 of the NRS prohibits the Company from declaring dividends where, after giving effect to the distribution of the dividend:

(a) The Company would not be able to pay its debts as they become due in the usual course of business; or

(b) Except as allowed in the Company's articles of incorporation the Company's total assets would be less than the sum of the Company's total liabilities plus the amount that would be needed to satisfy any preferential rights.

The Company has never declared, nor paid, any dividend since their incorporation and they do not foresee paying any dividend in the near future since all available funds will be used to conduct the Company's business development activities.  Any future payment of dividends will depend on its financing requirements and financial condition and other factors which the board of directors, in its sole discretion, may consider appropriate.

Recent Sales of Unregistered Securities

During the past three years, the Company has not sold any securities.

ITEM 6. SELECTED FINANCIAL DATA

Not applicable

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

Management's Discussion and Analysis

The following selected financial data was derived from the Company's audited and unaudited financial statements.  The information set forth below should be read in conjunction with the Company's financial statements and related notes included elsewhere in this registration statement. In addition, the Company expects to focus its resources on the development of its Gaming business in the near future.  This business is significantly different from the domain name and web development business that the Company has historically been engaged in.  As a result, historical results and capital requirements are not expected to be reflective of the Company's financial results and capital requirements moving forward.

Summary of Results

Results of Operation

Revenue

The Company recognized a gain of $117,466 from the sale of a domain name during the year ended December 31, 2020 (2019 - $359,200).  The Company did not recognize recurring revenues during its 2020 or 2019 fiscal years.  The Company continues to market its domain names in its portfolio and considers offers received for domain names in its portfolio.  The Company believes its portfolio of domain names will continue to maintain its value over time.  The Company does not anticipate earning significant advertising revenue from SPRT MTRX in the 2021 fiscal year.

The Company has an accumulated deficit of $17,737,642 at December 31, 2020.  The Company is presently in the development stage of its business and cannot provide any assurances that it will be able to generate regular or recurring revenues in the near future.

Subsequent to its fiscal year ended December 31, 2020, the Company completed the sale of one of its domain names for $1,150,000.

Operating Expenses

Operating expenses for the year ended December 31, 2020 were $283,775 as compared to $343,435 for the year ended December 31, 2019, a decrease of $59,660. A majority of the change is attributable to the decrease in marketing costs related to the eBalance micro current device, the sale of which the Company has ceased and a decrease in registration costs for domain names that no longer form an integral part of the business going forward.

Year Ended December 31, 2020 and 2019

The Company recorded a net profit of $231,999 for the year ended December 31, 2020 and net profit of $15,765 for the year ended December 31, 2019.  The difference is the result of two transactions follows:  During the year ended December 31, 2020 the Company had a gain of $117,466 from the sale of domain names compared to $359,200 in the year ended December 31, 2019.  This gain in the year ended 2019 was more than offset by a gain in the year ended 2020 of $398,308 due to the change in the fair value of an equity investment received as part of the sale of the eBalance marketing rights agreement as detailed below and the gain on the sale of the license.

On January 29, 2020, the Company made the decision to exit the medical device distribution business and agreed to sell back to Cell MedX Corp. ("Cell MedX") the exclusive worldwide distribution rights to Cell MedX's eBalance microcurrent device, acquired in 2019 (the "Distribution Rights").  Under the terms of the agreement, the Company sold the Distribution Rights back to Cell MedX in consideration for a royalty on future sales of the eBalance device capped at US$507,500, plus warrants to purchase up to 2,000,000 shares in the common stock of Cell MedX (the "Warrants") exercisable for a period of three (3) years. 1,000,000 of the Warrants are exercisable at a price of $US0.50 per share (the "$0.50 Warrants"), with the remaining 1,000,000 Warrants exercisable at US$1.00 per share (the "$1.00 Warrants").  The Warrants are subject to an acceleration right, with the $0.50 Warrants being subject to acceleration if Cell MedX's common stock trades at or above $1.00 per share for 30 consecutive trading days, and the $1.00 Warrants being subject to acceleration if Cell MedX's common stock trades at or above $1.75 per share for 30 consecutive trading days. 

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Liquidity and Capital Resources

At December 31, 2020, the Company had a working capital surplus of $41,938, compared to $324,145 at December 31, 2019.  The Company's only source of cashflow during the year ended December 31, 2020 was through the sale of domain names totaling $117,466.  Due to the fact that the Company has incurred recurring losses and anticipates incurring further losses in the future, the Company has determined there is substantial doubt as to its ability to continue as a going concern.

The Company does not believe it has the necessary cash requirements for the next 12 months without having to raise additional funds.

The Company does not anticipate purchasing any plant or significant equipment in the immediate future.

Off-Balance Sheet Arrangements

The Company has no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to shareholders.

Critical Accounting Policies

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the SEC did not, or are not believed by management to, have a material impact on the Company's present or future financial position, results of operations or cash flows.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

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LIVE CURRENT MEDIA INC.

CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2020

(Expressed in US Dollars)

F-1

Report of Independent Registered Public Accounting Firm

To the shareholders and the board of directors of Live Current Media, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Live Current Media, Inc. (the "Company") as of December 31, 2020 and 2019, the related statements of operations, stockholders' equity, and cash flows for the years then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note 1 to the financial statements, the Company has not generated revenues since inception, expects to incur further losses from operations, and requires additional funds to meet its obligations and repay its liabilities arising from normal business operations.  These factors raise substantial doubt about the Company's ability to continue as a going concern.  Management's plans in this regard are described in Note 1.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting in accordance with the standards of the PCAOB. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion in accordance with the standards of the PCAOB.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

F-2

/s/ DALE MATHESON CARR-HILTON LABONTE LLP

DALE MATHESON CARR-HILTON LABONTE LLP

CHARTERED PROFESSIONAL ACCOUNTANTS

We have served as the Company's auditor since 2017

Vancouver, Canada

March 30, 2021

The accompanying notes are an integral part of these consolidated financial statements

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The accompanying notes are an integral part of these consolidated financial statements

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The accompanying notes are an integral part of these consolidated financial statements

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The accompanying notes are an integral part of these consolidated financial statements

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1. NATURE AND CONTINUANCE OF OPERATIONS

Live Current Media Inc. (the "Company" or "Live Current") was incorporated under the laws of the State of Nevada on October 10, 1995. The Company's wholly owned principal operating subsidiary, Domain Holdings Inc. ("DHI"), was incorporated under the laws of British Columbia on July 4, 1994 under the name "IMEDIAT Digital Creations Inc.". On April 14, 1999, IMEDIAT Creations, Inc. changed its name to "Communicate.com Inc." and was redomiciled from British Columbia to the jurisdiction of Alberta. On April 5, 2002, Communicate.com Inc. changed its name to Domain Holdings Inc.

On March 13, 2008, the Company incorporated a wholly owned subsidiary in the state of Delaware, Perfume.com Inc. (Perfume Inc.) which is a dormant and inactive company.

Live Current is a digital technology company involved in the entertainment industry.  Currently developing SPRT MTRX which is positioned in the sports/gaming sector.

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As of December 31, 2020, the Company has not achieved profitable operations, has incurred recurring operating losses and further losses are possible. The Company has an accumulated deficit of $17,737,642. The Company's ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to further develop its business. To date, the Company has funded operations through the issuance of capital stock and debt. Management plans to continue raising additional funds through equity or debt financings and loans from directors. There is no certainty that further funding will be available as needed. These factors raise substantial doubt about the ability of the Company to continue operating as a going concern. The ability of the Company to continue its operations as a going concern is dependent upon its ability to raise sufficient new capital to fund its operating commitments and ongoing losses and ultimately on generating profitable operations. The consolidated financial statements do not include any adjustments to be recorded to assets or liabilities that might be necessary should the Company be unable to continue as a going concern.

In March of 2020, the World Health Organization declared an outbreak of COVID-19 a global pandemic. The COVID-19 has impacted a vast array of businesses through the restrictions put in place by most governments internationally, including the USA federal government as well as provincial and municipal governments, regarding travel, business operations and isolation/quarantine orders. At this time, it is unknown to what extent the impact of the COVID-19 outbreak may have on the Company as this will depend on future developments that are highly uncertain and that cannot be predicted with confidence. These uncertainties arise from the inability to predict the ultimate geographic spread of the disease, and the duration of the outbreak, including the duration of travel restrictions, business closures or disruptions, and quarantine/isolation measures that are currently, or may be put, in place world-wide to fight the virus. While the extent of the impact is unknown, the COVID-19 outbreak may hinder the Company's ability to raise financing for operating costs due to uncertain capital markets, supply chain disruptions, increased government regulations and other unanticipated factors, all of which may also negatively impact the Company's business and financial condition. 

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States ("US GAAP'), and pursuant to the rules and regulations of the United States Security and Exchange Commission ("SEC"), and are expressed in United States dollars.

Basis of Presentation

These consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany balances have been eliminated on consolidation.

Development Costs

The Company has adopted the provisions of ASC 985-20-25, Costs of Software to Be Sold, Leased or Marketed, whereby costs incurred to establish the technological feasibility of a computer software product to be sold, leased or marketed are research and development coasts.  Those costs are expressed as incurred; costs of producing product masters incurred subsequent to establishing technological feasibility are capitalized; and costs incurred when the product is available for general release to the customers are expensed as incurred.  Upgrades and enhancements are capitalized if they result in added functionality which enables the software to preform tasks it was previously incapable of performing.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions. The Company bases its estimates and assumptions on current facts, historical experience and various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. Examples of key estimates in these financial statements include the valuation of deferred tax assets, estimated variable consideration on the sale of license, fair value of stock-based compensation valuation of intangible assets and fair value of equity investment. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Cash and cash equivalents

All highly liquid investments, with an original term to maturity of three months or less are classified as cash and cash equivalents. Cash and cash equivalents are stated at cost which approximates market value.

Intangible Assets not subject to amortization

Intangible assets not subject to amortization consist of direct navigation domain names. While the domain names are renewed annually, through payment of a renewal fee to the applicable registry, the Company has the exclusive right to renew these names at its option. The Company has determined that there are currently no legal, regulatory, contractual, economic or other factors that limit the useful life of these domain names on an aggregate basis and accordingly treat the portfolio of domain names as indefinite life intangible assets.

The Company reviews individual domain names in the portfolio for potential impairment throughout the fiscal year in determining whether a particular URL should be renewed. Impairment is recognized for names that are not renewed. The Company performs an annual assessment of individual domain names in its portfolio to determine whether it is more likely than not that the fair market value of a domain name is less than its carrying amount. When it is determined that the fair value of a domain name is less than its carrying amount, impairment is recognized.

Foreign Currency Translation

The Company's functional currency is the US dollar and reporting currency is the United States dollar. The Company translates assets and liabilities to US dollars using year-end exchange rates, stockholders' deficit accounts are translated at historical exchange rates, and translates revenues and expenses using average exchange rates during the period. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the Statement of Operations.

Income Recognition

The Company recognizes income from the sale of intangible assets when the control of the asset is transferred to the customer at the amount that reflects the consideration it expects to be entitled to in exchange for this performance obligation.  In determining the transaction price for the sale of assets, the Company considers the effects of variable consideration. Some contracts for the sale of assets provide the Company future royalty payments based on the sales generated by the purchaser.  The Company constrained its estimates to reduce the probability of a significant income reversal in future periods.  The Company uses the expected value method to estimate the variable consideration because this method best predicts the amount of variable consideration to which the Company will be entitled. The Company uses historical evidence, current information and forecasts to estimate the variable consideration. The requirements in ASC 606 on constraining estimates of variable consideration are applied to determine the amount of variable consideration that can be included in the transaction price.  The estimate is updated at each reporting period date.

Income taxes

The Company follows the liability method of accounting for income taxes.  Under this method, current income taxes are recognized for the estimated income taxes payable for the current year.  Deferred income tax assets and liabilities are recognized in the current year for temporary differences between the tax and accounting basis of assets and liabilities as well as for the benefit of losses available to be carried forward to future years for tax purposes.  Deferred income tax assets and liabilities are measured using tax rates and laws expected to apply in the years in which those temporary differences are expected to be recovered or settled.  The effect of a change in tax rates on deferred income tax assets and liabilities is recognized in operations in the year of change.  A valuation allowance is recorded when it is "more likely-than-not" that a deferred tax asset will not be realized.  Deferred tax assets and deferred tax liabilities, along with any associated valuation allowance, are offset and shown in the financial statements as a single noncurrent amount when these items arise within the same tax jurisdiction.

The Company and its subsidiaries are subject to U.S. federal income tax and Canadian income tax, as well as income tax of multiple state and local jurisdictions. Based on the Company's evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in the Company's financial statements.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Stock Based Payments

The Company accounts for all stock-based payments and awards under the fair value based method. The Company accounts for the granting of stock options to employees using the fair value method whereby all awards to employees will be measured at fair value on the date of the grant. The fair value of all stock options are expensed over their vesting period with a corresponding increase to additional paid-in capital. Upon exercise of stock options, the consideration paid by the option holder, together with the amount previously recognized in additional paid-in capital is recorded as an increase to share capital. Stock options granted to employees are accounted for as liabilities when they contain conditions or other features that are indexed to other than a market, performance or service condition. Stock-based payments to non-employees are measured at the fair value of the consideration received, or the fair value of the equity instruments issued, or liabilities incurred, whichever is more reliably measurable. The fair value of stock-based payments to non-employees is periodically re-measured until the counterparty performance is complete, and any change therein is recognized over the vesting period of the award and in the same manner as if the Company had paid cash instead of paying with or using equity based instruments. The fair value of the stock-based payments to non-employees that are fully vested and non-forfeitable as at the grant date are measured and recognized at that date.

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock options. The use of the Black-Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected term of the option, risk-free interest rates, the value of the common stock and expected dividend yield of the common stock. Changes in these assumptions can materially affect the fair value estimate.

Fair Value of Financial Instruments

The estimated fair values for financial instruments are determined based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The estimated fair value of cash, receivable, accounts payable and amounts due to shareholders of Auctomatic approximate their carrying value due to the short-term nature of those instruments.

ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1 - Quoted prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable; and

Level 3 - Unobservable inputs that are supported by little or no market activity, there for requiring an entity to develop its own assumptions about the assumption that market participants would use in pricing.

The Company had no Level 3 assets or liabilities required to be recorded at fair value on a recurring basis in accordance with US GAAP as at December 31, 2020 and 2019. Cash is measured at fair value using level 1 and equity investment are measured at fair value using level 2.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Basic and Diluted Income (Loss) per Share

Earnings or loss per share ("EPS") is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted EPS is computed by dividing net income (loss) by the weighted-average of all potentially dilutive shares of the common stock that were outstanding during the years presented. The treasury stock method is used in calculating diluted EPS for potentially dilutive stock options and share purchase warrants, which assumes that any proceeds received from the exercise of in-the-money stock options and share purchase warrants, would be used to purchase common shares at the average market price for the period.

3. SHARE CAPITAL

Authorized

The authorized capital of the Company consists of 500,000,000 shares of common stock with a par value of $0.001 per share. No other shares have been authorized

4. STOCK OPTIONS

The Company's Stock Option Plan (the "Plan") provides the grant of 5,000,000 shares of common stock of the Company, subject to increase after March 31, 2019, upon approval by the Company's directors, provided that the total number of shares that may be optioned and sold under the Plan shall at no time be greater than 15% of total number of shares of common stock outstanding, less any options still outstanding under any previous stock option plan.

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock options.  The use of the Black-Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected term of the option, risk-free interest rates, the value of the common stock and expected dividend yield of the common stock.  Changes in these assumptions can materially affect the fair value estimates.

During the year ending December 31, 2020, 1,900,000 Stock Options previously issued expired.

On February 21, 2020, the board of directors granted 200,000 options to one of its contractors.  These stock options vest as to one-fourth immediately and one-fourth after the first, second and third six months period of the date granted.  The fair value of the options granted calculated to be $11,673.  The Company recognized a total of $5,836 as share-based compensation related to stock options vested during the year ending December 31, 2020. The fair values were determined using the Black-Scholes Option Pricing model with the following assumptions:.

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4. STOCK OPTIONS continued

As at December 31, 2020, the Company had 200,000 (2019 - 1,900,000) option outstanding with a weighted average exercise price and weighted average life of $.10 and 1.14 years, respectively.

5. EQUITY INVESTMENT AND ROYALTIES

On March 21, 2019, the Company entered an agreement with Cell MedX Corp/ ("CMXC") to purchase the direct rights to distribute the eBalance device from CMXC. On January 29, 2020 the Company and CMXC entered a Buyback agreement to sell the exclusive distribution rights to the eBalance microcurrent device back to CMXC.

The sale price included a retained royalty on future sales of the eBalance device capped at US$507,000 and share purchase warrants for 2,000,000 shares of CMXC of which 1,000,000 are exercisable at $0.50 and 1,000,000 exercisable at $1.00. As of December 31, 2020. The Company's equity investment consists of 2,000,000 share purchase warrants.  Each CMXC share purchase warrant is exercisable for a period of three years expiring on January 31, 2023. 

As of December 31, 2020, the fair value of the equity investment was calculated to be $398,308 based on the market price of $0.27 per CMXC common share using a Black Scholes Options Pricing model with the following assumptions.

The initial recognition of the equity investment in CMXC resulted in a $351,134 gain on sale of distribution license which is equivalent to the fair value of equity investment received.  On December 31, 2020 the equity investment was revalued resulting in a cumulative gain of $398,308.  The Company constrained the gain to the fair value of the equity instruments received, as at the point of sale future royalty payments were uncertain as Cell MedX had limited sales and had not obtained Health Canada Class II Medical Device License for the eBalance® Device or the 510K certification from the Food and Drug Administration.  The company reviewed its estimates at December 31, 2020 and did not include an additional gain from the royalty.

The transaction is considered to be a related party transaction as the Company has a common director with Cell MedX and there are beneficial shareholders in common for both Companies.

6. INTANGIBLE ASSETS

The Company's portfolio of domain names are considered by management to be indefinite life intangible assets not subject to amortization. Management performs an annual impairment assessment of its domain names; during the year ended December 31, 2020, the Company recorded an impairment charge of $Nil (2019: $Nil).

The Company is developing computer software for SPRT MTRX which is in the development stage.  No amortization costs have been recorded as of December 31, 2020.

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7. INCOME TAXES

The Company was subject to United States federal income taxes at an approximate rate of 21%.  The reconciliation of the provision for income taxes at the United States federal statutory rate compared to the Company's income tax expense as reported is as follows:

The significant components of deferred income tax assets at December 31, 2020 and December 31, 2019 are as follows:

At December 31, 2020, the Company had approximately $458,000 of non-capital losses carry-forwards in Canada which expire in 2040 and non-capital loss carry-forwards of approximately $7,802,000 that may be carried forward indefinitely, subject to limitations. The potential future tax benefits of these expenses and losses carried-forward have not been reflected in these consolidated financial statements due to the uncertainty regarding their ultimate realization. Tax attributes are subject to review, and potential adjustment by tax authorities.

8. SUBSEQUENT EVENTS

On January 8, 2021, the Company issued certain Corporation's Officers, Directors and Consultants non-qualified and incentive stock options pursuant the Corporation's 2018 Stock Option Plan to purchase an aggregate of 1,600,000 shares of the Corporation's common stock that vest immediately at an exercise price of $0.10 per share and expire in 2 years.

On March 22, 2021 the Company completed the sale of one of its domain names for $1,150,000, resulting in a gain of $913,246.

In March 2021 the Company discontinued development of Boxing.com Federation.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Not applicable

ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

We carried out an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of December 31, 2019 (the "Evaluation Date").  This evaluation was carried out under the supervision and with the participation of our principal executive officer and principal financial officer.  Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of the Evaluation Date.

Management's Annual Report on Internal Control Over Financial Reporting

Disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the SEC's rules and forms. Management is responsible for establishing and maintaining adequate internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act of 2002 (SOX). Our internal control over financial reporting is a process designed under the supervision of our Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures that:

• pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
• provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and our Board of Directors; and
• provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Management conducted an assessment of the effectiveness of our internal control over financial reporting as of May 31, 2020, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). As a result of this assessment, it was found that the internal controls cannot be relied upon due to lack of segregation of duties.

Our independent auditors have not issued an attestation report on management's assessment of our internal control over financial reporting. As a result, this Annual Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. We were not required to have, nor have we, engaged our independent registered public accounting firm to perform an audit of internal control over financial reporting pursuant to the rules of the Securities and Exchange Commission that permit us to provide only management's report in this Annual Report.

Changes in Internal Control Over Financial Reporting

As of the Evaluation Date, there were no changes in our internal control over financial reporting that occurred during the fiscal year ended December 31, 2020 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls and Procedures

Our management, including our principal executive officer and principal financial officer, do not expect that our controls and procedures will prevent all potential error and fraud.  A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met

ITEM 9B. OTHER INFORMATION

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PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The following table sets forth the name and positions of the Company's executive officers and directors as of the date hereof.

Set forth below is a brief description of the background and business experience of the Company's executive officers and directors:

David Jeffs Mr. Jeffs has been the Chief Executive Officer, President, Treasurer and Secretary of the Company since October 2010.  He was also the Chief Executive Officer of the Company from July 2002 through May 2007 and the President and a director of the Company from July 2002 through September 2007.  Previously he was a consultant to the Company's subsidiary, Domain Holdings Inc., from November 2000 and was responsible for revenue-generating initiatives. Prior to consulting for Domain Holdings Inc., Mr. Jeffs was the president and director of a private corporation trading in consumer goods products since 1997.  Mr. Jeffs graduated from the University of British Columbia with a Bachelor of Arts where he majored in economics.

Joao (John) da Costa Mr. da Costa has more than twenty-five years of experience providing bookkeeping and accounting services to both private and public companies and is the founder and President of Da Costa Management Corp., a company that has provided management and accounting services to public and private companies since August 2003. Mr. da Costa currently serves as the CFO, Treasurer and a director of Red Metal Resources Ltd., a company reporting under the Exchange Act and engaged in the business of acquiring and exploring mineral claims.  Mr. da Costa also currently serves as the CFO and a director of Kesselrun Resources Ltd., a Canadian reporting company listed on the TSX Venture Exchange.

Amir Vahabzadeh Mr. Vahabzadeh has been involved in the internet industry as a private online business owner and consultant for more than 20 years.  Mr. Vahabzadeh holds a Bachelor of Arts degree and is a graduate of the University of British Columbia and has been a shareholder of the Company since 2000.

Term Of Office

The Company's directors are elected to hold office until the next annual meeting of the shareholders and until their respective successors have been elected and qualified. The Company's executive officers are appointed by its board of directors and hold office until removed by its board of directors or until their successors are appointed.

Other Significant Employees

Other than the Company's sole executive officer, the Company does not have any significant employees.

Audit Committee

The Company does not currently have a separately designated audit committee.  As such, the Company's entire board of directors acts as its audit committee.  The Company's board of directors has determined that Mr. da Costa qualifies as an "audit committee financial expert" as that term is defined in Item 407(d) of Regulation SK.  The OTCQB Marketplace, where the Company's securities are traded, does not have independence requirements.  In determining independence, the Company has applied the definition set out in NASDAQ Rule 5605(a)(2).  Mr. da Costa meets the qualifications for independence set forth in that rule.

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Code of Ethics

We adopted a Code of Ethics applicable to our officers and directors which is a "code of ethics" as defined by applicable rules of the SEC. If we make any amendments to our Code of Ethics other than technical, administrative, or other non-substantive amendments, or grant any waivers, including implicit waivers, from a provision of our Code of Ethics to our principal executive officer, principal financial officer, or certain other finance executives, we will disclose the nature of the amendment or waiver, its effective date and to whom it applies in a current report on Form 8-K filed with the SEC.  A copy of our Code of Ethics is attached as an exhibit to this Annual Report.

DELINQUENT SECTION 16(a) REPORTS

Section 16(a) of the Exchange Act requires our executive officers and directors, and persons who own more than 10% of a registered class of our securities ("Reporting Persons"), to file reports of ownership and changes in ownership with the SEC.  Based solely on our review of the reports electronically filed by the Reporting Persons, the Company has determined that the following persons have failed to file, on a timely basis, the reports required by Section 16(a) of the Exchange Act during our fiscal year ended December 31, 2020:

ITEM 11. EXECUTIVE COMPENSATION

Summary Compensation Table

The following table sets forth the total compensation paid or accrued to the Company's named executive officers, as that term is defined in Item 402(m)(2) of Regulation S-K, during its last two completed fiscal years.

Notes:

(1) The Company does not have a written compensation arrangement in place with David Jeffs, however, it has agreed to compensate Mr. Jeffs at a rate of $120,000 per year, commencing in January of 2017, for his commitment as Chief Executive Officer.

Outstanding Equity Awards at Fiscal Year End

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

The following table provides information concerning unexercised options for each of our named executive officers, as that term is defined in Item 402(m)(2) of Regulation S-K as of our fiscal year end of December 31, 2020.

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Director Compensation

The following table sets forth the compensation paid to our directors during our December 31, 2020 fiscal year, other than directors who were also named executive officers as that term is defined in Item 402(m)(2). Compensation paid to directors who were also named executive officers during our December 31, 2020 fiscal year is set out in the tables above.

Compensation Committee Interlocks and Insider Participation

The Company does not have a compensation committee.  The Board of Directors conducts reviews with regard to the compensation of the directors and the Chief Executive Officer once a year.  To make its recommendations on such compensation, the Board of Directors takes into account the types of compensation and the amounts paid to officers of comparable publicly traded companies.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Equity Compensation Plan Information

The following table sets forth certain information concerning all equity compensation plans previously approved by stockholders and all previous equity compensation plans not previously approved by stockholders, as of December 31, 2020, our most recent fiscal year end.

Equity Compensation Plan Information

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2018 Stock Option Plan

On November 28, 2018, our board of directors approved and adopted the Company's 2018 Stock Option Plan (the "Plan"). The purpose of the Plan is to enhance long-term shareholder value by offering the Company's directors, officers, employees and eligible consultants the ability to acquire and maintain stock ownership in the Company and to participate in the Company's future growth.

The Plan allows the board to grant awards to officers, directors, employees and certain eligible consultants. To be eligible for grants under the Plan, consultants must be individuals who (1) render bona fide services to the Company not connected to the offer or sale of the Company's securities in capital raising transactions, and (2) do not directly or indirectly promote or maintain a market for the Company's securities.

Initially, up to 5,000,000 shares of the Company's common stock may be purchased pursuant to options granted under the Plan. After March 31, 2019, the Board may increase the shares of common stock that may be purchased under the Plan, provided that the total number of shares that may be purchased under the Plan cannot exceed 15% of the total number of shares outstanding, less any options outstanding under previous stock option plans.

Awards under the Plan may be granted in the form of incentive stock options or non-qualified stock options. Incentive stock options granted under the Plan are those intended to qualify as "incentive stock options" as defined under Section 422 of the Internal Revenue Code (the "Code"). To qualify as "incentive stock options" under Section 422 of the Code, the Plan must be approved by the stockholders of the Company within 12 months of its adoption. If the Plan is not approved by the Company's stockholders within 12 months of its adoption, any options granted as "incentive stock options" will be treated as "non-qualifying stock options". Non-qualified stock options granted under the Plan are option grants that do not qualify as incentive stock options under Section 422 of the Code.

The exercise price for incentive stock options granted under the Plan cannot be less than the fair market value of the Company's common stock on the date of grant (110% of fair market value for optionees that own 10% of the combined voting power of the Company). Non-qualified stock options may not have an exercise price less than 75% of fair market value at the time of grant. "Fair market value" for purposes of the Plan is defined as the lesser of the closing price of the Company's common stock on the day immediately preceding the date of grant, and the average closing price of the Company's common stock during the ten trading days immediately preceding the grant date, provided that the Company's common stock trades on a national securities exchange or the OTC Link system (maintained by OTC Markets Group Inc.). If the Company's common stock does not trade on the OTC Link or a national securities exchange in the United States, the Board may determine fair market value, acting in good faith.

Options granted under the Plan have a maximum term of ten years from the grant date, or such lesser period as determined by the Board.

Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certain information concerning the number of common shares owned beneficially as of March 30, 2021 by: (i) each person (including any group) known to us to own more than five percent (5%) of any class of the Company's voting securities, (ii) each of its directors, (iii) each of its named executive officers; and (iv) officers and directors as a group. Unless otherwise indicated, the shareholders listed possess sole voting and investment power with respect to the shares shown.

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Notes:

(1) Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the number of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person's actual ownership or voting power with respect to the number of its shares actually outstanding on March 30, 2021.  As of March 30, 2021, there were 34,837,625 shares of common stock issued and outstanding.

(2) 1,124,500 shares are registered in the names of immediate family members sharing the same address as Mr. Jeffs.

(3) Includes options to purchase 200,000 shares of our common stock at an exercise price of $0.10 per share.

(4) Includes options to purchase 1,000,000 shares of our common stock at an exercise price of $0.10 per share.

(5) Includes options to purchase 200,000 shares of our common stock at an exercise price of $0.10 per share.

Changes in Control

The Company is not aware of any arrangement, which may result in a change in control in the future.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Related Transactions

None of the following parties has, during the Company's last two fiscal years, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us, in which the Company is a participant and the amount involved exceeds the lesser of $120,000 or 1% of the average of the Company's total assets for the last two completed fiscal years:

(i) Any of its directors or officers;

(ii) Any person proposed as a nominee for election as a director;

(iii) Any person who beneficially owns, directly or indirectly, shares carrying more than 10% of the voting rights attached to its outstanding common shares;

(iv) Any of its promoters; and

(v) Any relative or spouse of any of the foregoing persons who has the same house as such person.

Director Independence

Quotations for the Company's common stock are currently entered on the OTC QB marketplace, which does not have director independence requirements.  In determining whether any of its directors are independent, the Company has applied the definition for "Independent Directors" set out in NASDAQ Rule 5605(a)(2).  In applying this definition, the Company has determined that John da Costa and Amir Vahabzadeh are independent directors.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

The aggregate fees billed for the two most recently completed fiscal years for professional services rendered by the principal accountant for the audit of our annual financial statements and review of the financial statements included in our Quarterly Reports on Form 10-Q and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal periods were as follows:

Our board of directors annually reviews the qualifications of Dale Matheson Carr-Hilton Labonte LLP, prior to engaging them as our auditors in accordance with Rule 2-01(c)(7)(i)(A) of Regulation S-X.

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PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

Notes:

(1) Filed as an exhibit to the Company's Registration Statement on Form 10, originally filed on February 1, 2018.

(2) Filed as an exhibit to the Company's Current Report on Form 8-K. filed on December 12, 2018.

(3) Filed as an exhibit to the Company's Current Report on Form 8-K filed on January 31, 2020.

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SIGNATURES

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

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