- Amended Quarterly Report (10-Q/A)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 2

Form 10-Q/A

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2009

o 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)

Nevada	88-0346310
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)

375 Water Street, Suite 645, Vancouver, British Columbia, V6B 5C6

(604) 453-4870

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. Yes x No o

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 (§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. Yes o No o

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.

Large accelerated filer o	Accelerated filer o
Non-accelerated filer o (Do not check if a smaller reporting company)	Smaller reporting company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

	Common Stock	23,934,268 shares outstanding
	$.001 Par Value	as of May 15, 2009

LIVE CURRENT MEDIA INC.

AMENDMENT NO. 2 TO FORM 10-Q

QUARTER ENDED MARCH 31, 2009

TABLE OF CONTENTS

		Page

PART I.	Financial Information

Item 1.	Unaudited Financial Statements	5

	Consolidated Balance Sheets as of March 31, 2009 and December 31, 2008	6
	Consolidated Statements of Operations for the periods ended March 31, 2009 and March 31, 2008	7
	Consolidated Statement of Stockholders’ Equity for the periods ended March 31, 2009 and December 31, 2008	8
	Consolidated Statements of Cash Flows for the periods ended March 31, 2009 and March 31, 2008	9
	Notes to the Consolidated Financial Statements	10

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	42

PART II

Item 6	Exhibits	68

Signatures		69

Certifications

EXPLANATORY NOTE

On June 18, 2009 we were advised by Ernst & Young, our independent registered public accounting firm, that there were errors in our March 31, 2009 consolidated financial statements (the “Original Financial Statements”). Based on the foregoing, C. Geoffrey Hampson, our Chief Executive Officer and Chief Financial Officer, concluded that the Original Financial Statements should no longer be relied upon. On September 17, 2009 we filed Amendment No. 1 to our Quarterly Report on Form 10-Q for the 3 months ended March 31, 2009, which was originally filed on May 15, 2009 (the “Original Report”) to disclose the restatement of our Original Financial Statements.

On October 7, 2009 we received a letter from the Securities and Exchange Commission relating to Amendment No. 1. The primary purpose of this amendment (“Amendment No. 2”) is to respond to the comment letter.

In Amendment No. 2, we have revised the presentation of our financial statements to respond to the comments made by the Securities and Exchange Commission. Aside from indicating in the column totals that the financial statements have been restated, in our consolidated statements of operations we have separated operating expenses from non-operating income (expenses). We have also indicated that our costs of goods sold exclude depreciation and amortization, and we have reclassified expenses related to Global Cricket Venture. We have revised the discussion at Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, to reflect the changes to our financial statements.

Amendment No. 2 includes information contained in the Original Report, and we have made no attempt in Amendment No. 2 to modify or update the disclosures presented in the Original Report, except as identified above. The disclosures in Amendment No. 2 continue to speak as of the date of the Original Report, and do not reflect events occurring after the filing of the Original Report. Accordingly, Amendment No. 2 should be read in conjunction with our other filings made with the Securities and Exchange Commission subsequent to the filing of the Original Report, including Amendment No. 1 and any other amendments to those filings. The filing of Amendment No. 2 shall not be deemed to be an admission that the Original Report, when made, included any untrue statement of a material fact or omitted to state a material fact necessary to make a statement not misleading.

PART I – FINANCIAL INFORMATION

Item 1: Financial Statements.

LIVE CURRENT MEDIA INC.

(formerly COMMUNICATE.COM INC.)

AMENDED AND RESTATED

CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2009

(UNAUDITED)

AMENDED AND RESTATED CONSOLIDATED BALANCE SHEETS

AMENDED AND RESTATED CONSOLIDATED STATEMENTS OF OPERATIONS

AMENDED AND RESTATED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

AMENDED AND RESTATED CONSOLIDATED STATEMENTS OF CASH FLOWS

NOTES TO THE AMENDED AND RESTATED CONSOLIDATED FINANCIAL STATEMENTS

LIVE CURRENT MEDIA INC.

(formerly COMMUNICATE.COM INC.)

AMENDED AND RESTATED CONSOLIDATED BALANCE SHEETS

Expressed In U.S. Dollars

(Going Concern - See Note 1)

As restated - Note 2

	March 31, 2009			December 31, 2008
	(As Restated)			(As Restated)
	(unaudited)			(audited)
ASSETS
Current
Cash and cash equivalents	$	572,588		$	1,832,520
Accounts receivable (net of allowance for doubtful accounts of nil)		100,035			93,582
Prepaid expenses and deposits		92,145			109,543
Inventory		47,421			74,082
Current portion of receivable from sales-type lease (Note 12)		23,423			23,423
Total current assets		835,612			2,133,150

Long-term portion of receivable from sales-type lease (Note 12)		-			23,423
Property & equipment (Note 8)		947,389			1,042,851
Website development costs (Note 9)		348,061			355,391
Intangible assets		1,557,267			1,587,463
Goodwill (Notes 5 and 7)		2,606,040			2,606,040
Total Assets	$	6,294,369		$	7,748,318

LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities	$	2,172,350		$	3,047,993
Amounts payable to the BCCI and IPL (Note 6)		750,000			1,000,000
Bonuses payable		127,964			354,695
Due to shareholders of Auctomatic (Note 7)		829,799			789,799
Deferred revenue		78,696			120,456
Current portion of deferred lease inducements (Note 10)		20,138			20,138
Total current liabilities		3,978,947			5,333,081

Deferred income tax (Note 14)		206,370			206,370
Warrants (Note 11e)		242,704			157,895
Deferred lease inducements (Note 10)		50,345			55,380
Total Liabilities		4,478,366			5,752,726

STOCKHOLDERS' EQUITY
Common Stock (Note 11)
Authorized: 50,000,000 common shares, $0.001 par value
Issued and outstanding:
23,906,445 common shares (December 31, 2008 - 23,546,370)		15,216			14,855
Additional paid-in capital		15,494,390			14,757,932
Accumulated deficit		(13,693,603	)		(12,777,195	)
Total Stockholders' Equity		1,816,003			1,995,592
Total Liabilities and Stockholders' Equity	$	6,294,369		$	7,748,318

Commitments and Contingency (Notes 16 and 17)
Subsequent Events (Note 19)

See accompanying notes to consolidated financial statements

LIVE CURRENT MEDIA INC.

(formerly COMMUNICATE.COM INC)

AMENDED AND RESTATED CONSOLIDATED STATEMENTS OF OPERATIONS

Expressed In U.S. Dollars

(Unaudited)

As restated - Note 2

	Three Months Ended			Three Months Ended
	March 31, 2009			March 31, 2008
	(As Restated)			(As Restated)
SALES
Health and beauty eCommerce	$	1,720,167		$	1,820,188
Other eCommerce		-			455
Domain name advertising		24,453			27,836
Miscellaneous income		7,762			-
Total Sales		1,752,382			1,848,479

COSTS OF SALES
Health and Beauty eCommerce		1,386,619			1,485,510
Other eCommerce		-			552
Total Costs of Sales (excluding depreciation and amortization as shown below)		1,386,619			1,486,062

GROSS PROFIT		365,763			362,417

OPERATING EXPENSES
Amortization and depreciation		98,166			15,266
Amortization of website development costs (Note 9)		32,562			-
Corporate general and administrative		326,354			549,837
ECommerce general and administrative		80,220			169,813
Management fees and employee salaries		1,193,595			1,175,850
Corporate marketing		3,771			26,459
ECommerce marketing		111,422			149,187
Other expenses (Note 13)		264,904			629,856
Total Operating Expenses		2,110,994			2,716,268

NON-OPERATING INCOME (EXPENSES)
Global Cricket Venture recovery (Note 6)		250,000			-
Gain from sales and sales-type lease of domain names (Note 12)		617,933			168,206
Accretion interest expense (Note 7)		(40,000	)		-
Interest and investment income		890			42,498
Non-controlling interest (Note 5)		-			51,506
Total Non-Operating Income (Expenses)		828,823			262,210

NET LOSS AND COMPREHENSIVE LOSS FOR THE PERIOD	$	(916,408	)	$	(2,091,641	)


BASIC AND DILUTED LOSS PER SHARE	$	(0.04	)	$	(0.10	)

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING - BASIC AND DILUTED		22,509,120			19,970,334

See accompanying notes to consolidated financial statements

LIVE CURRENT MEDIA INC. (formerly COMMUNICATE.COM INC) AMENDED AND RESTATED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Expressed In U.S. Dollars As restated - Note 2

	Common stock					Additional Paid- in Capital			Accumulated Deficit			Total
	Number of Shares			Amount
Balance, December 31, 2007 (audited) (as restated)		21,446,623		$	12,456	$	10,170,004		$	(2,789,925	)	$	7,392,535
Stock-based compensation (Note 11d)		-			-		2,162,526						2,162,526
Issuance of 586,403 common shares per the merger		-			-		-						-
agreement with Auctomatic (Note 7)		586,403			586		1,248,279						1,248,865
Issuance of 33,000 common shares to investor relations firm (Note 11b)		33,000			33		85,649						85,682
Issuance of 120,000 common shares to investor relations firm (Note 11b)		120,000			120		218,057						218,177
Issuance of 50,000 warrants to investor relations firm (Note 11e)		-			-		45,500						45,500
Cancellation of 300,000 common shares not distributed (Note 11b)		(300,000	)		-		-						-
Private Placement of 1,627,344 units at $0.65 per share (Note 11b)		1,627,344			1,627		898,253						899,880
Share issue costs (Note 11b)		-			-		(86,803	)					(86,803	)
Extinguishment of accounts payable (Note 11b)		33,000			33		16,467						16,500
Net loss and comprehensive loss										(9,987,270	)		(9,987,270	)
Balance, December 31, 2008 (audited) (as restated)		23,546,370			14,855		14,757,932			(12,777,195	)		1,995,592
Stock-based compensation (Note 11d)		-			-		610,343						610,343
Issuance of 15,000 common shares to investor relations firm (Note 11b)		15,000			15		5,685						5,700
Extinguishment of accounts payable (Note 11b)		345,075			346		120,430						120,776
Net loss and comprehensive loss										(916,408	)		(916,408	)
Balance, March 31, 2009 (unaudited) (as restated)		23,906,445		$	15,216	$	15,494,390		$	(13,693,603	)	$	1,816,003

See accompanying notes to consolidated financial statements

LIVE CURRENT MEDIA INC.

(formerly COMMUNICATE.COM INC)

AMENDED AND RESTATED CONSOLIDATED STATEMENTS OF CASH FLOWS

Expressed In U.S. Dollars

(Unaudited)

As restated - Note 2

	Three Months Ended			Three Months Ended
	March 31, 2009			March 31, 2008
	(As Restated)			(As Restated)
OPERATING ACTIVITIES
Net loss for the period	$	(916,408	)	$	(2,091,641	)
Non-cash items included in net loss:
Non-controlling interest		-			(51,506	)
Gain from sales and sales-type lease of domain name		(617,933	)		(168,206	)
Accretion interest expense		40,000			-
Stock-based compensation		610,343			443,721
Warrants issued		84,809			-
Issuance of common stock for services (Note 11b)		5,700			-
Extinguishment of debt by issuance of common stock (Note 11b)		120,776			-
Amortization and depreciation		125,693			10,231
Change in operating assets and liabilities:
Accounts receivable		(6,453	)		(3,290	)
Prepaid expenses and deposits		17,398			81,112
Inventory		26,661			-
Accounts payable and accrued liabilities		(1,111,295	)		(28,597	)
Amounts payable to the BCCI and IPL		(250,000	)		-
Bonuses payable		8,919			(117,688	)
Deferred revenue		(41,760	)		(33,435	)
Cash flows used in operating activities		(1,903,550	)		(1,959,299	)

INVESTING ACTIVITIES
Accrued expenses relating to deferred acquisition costs		-			(111,265	)
Deferred acquisition costs		-			(121,265	)
Net proceeds from sale of domain name		358,130			-
Net proceeds from sales-type lease of domain name		313,423			23,423
Purchases of property & equipment		(2,704	)		(154,069	)
Website development costs (Note 9)		(25,231	)		(147,025	)
Cash flows from (used in) investing activities		643,618			(510,201	)

Net decrease in cash and cash equivalents		(1,259,932	)		(2,469,500	)

Cash and cash equivalents, beginning of period		1,832,520			7,375,245
Cash and cash equivalents, end of period	$	572,588		$	4,905,745

See accompanying notes to consolidated financial statements

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION

Nature of business

Live Current Media Inc. (the “Company”) was incorporated under the laws of the State of Nevada on October 10, 1995 under the name “Troyden Corporation” and changed its name on August 21, 2000 from Troyden Corporation to “Communicate.com Inc.”. On May 30, 2008, the Company changed its name from Communicate.com Inc. to Live Current Media Inc. after obtaining formal shareholder approval to do so at the Annual General Meeting in May 2008.

The Company’s 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 Digital 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. DHI has 62,635,383 shares of common stock currently issued and outstanding. 61,478,225 shares, or approximately 98.2% of the outstanding shares, are held by Live Current.

Through DHI, the Company builds consumer Internet experiences around its large portfolio of domain names. DHI’s current business strategy is to develop or to seek partners to develop its domain names to include content, commerce and community applications. At March 31, 2009, DHI was actively developing websites on two domain names; one that provides e-commerce for fragrance and other health and beauty products, and another that will be a media rich consumer experience on a sports related website where the revenue model is based on paid advertising and sales of digital content and merchandise. DHI develops content and sells advertising services on other domains held for future development. Refer to Note 19.

DHI owns 100% of 0778229 B.C. Ltd. (“Importers”), Acadia Management Corp. (“Acadia”), and a dormant company 612793 B.C. Ltd. (“612793”). Acadia’s assets and liabilities were assigned to DHI in October 2008, and that company was dissolved and removed from the registrar of companies of British Columbia on January 21, 2009.

On March 13, 2008, the Company incorporated a wholly owned subsidiary in the state of Delaware, Communicate.com Delaware, Inc. (“Delaware”). This subsidiary was incorporated in relation to the Auctomatic transaction. Refer to Note 7.

On August 8, 2008, the Company also formed a wholly-owned subsidiary in Singapore, LCM Cricket Ventures Pte. Ltd. (“LCM Cricket Ventures”). This company holds 50.05% of Global Cricket Venture Pte. Ltd. (“Global Cricket Venture” or “GCV”).

Basis of presentation

The consolidated financial statements are presented in United States dollars and are prepared in accordance with accounting principles generally accepted in the United States.

Going Concern

The consolidated financial statements have been prepared on a going concern basis which assumes that the Company will be able to realize assets and discharge liabilities in the normal course of business for the foreseeable future. The Company has generated a consolidated net loss for the quarter ended March 31, 2009 of $916,408 ($9,987,270 for the year ended December 31, 2008) and realized a negative cash flow from operating activities of $1,903,550 for the quarter ended March 31, 2009 ($4,854,260 for the year ended December 31, 2008). There is an accumulated deficit of $13,693,603 (December 31, 2008 - $12,777,195) and a working capital deficiency of $3,143,335 at March 31, 2009 ($3,199,931 at December 31, 2008).

The Company's ability to continue as a going-concern is in substantial doubt as it is dependent on the continued financial support from its investors, the ability of the Company to raise equity financing and the attainment of profitable operations and further share issuances to meet the Company's liabilities as they become payable. The outcome of these matters is dependant on factors outside of the Company’s control and cannot be predicted at this time. Refer to Note 19.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION (continued)

Going Concern (continued)

The accompanying consolidated financial statements have been prepared on a going concern basis which assumes that the Company will be able to realize assets and discharge liabilities in the normal course of business for the foreseeable future. These financial statements do not include any adjustments relating to the recoverability or classification of assets or the amounts or classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company has established a plan to continue its current business operations and overcome its financial difficulties. The Company expects to achieve an improved financial position and enhanced liquidity by establishing and carrying out a plan of recovery as discussed in Note 1 of the Company’s audited financial statements for the year ended December 31, 2008 included in its amended and restated December 31, 2008 consolidated financial statements as filed in Amendment No. 1 to the Company’s Annual Report on Form 10-K.

NOTE 2 – RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS

The Company determined that its original consolidated financial statements for the quarter ended March 31, 2009 (the “Original Financial Statements”), which were included in the Company’s Quarterly Report on Form 10-Q and filed with the Securities and Exchange Commission on May 15, 2009, as well as the original consolidated financial statements for the fiscal year ended December 31, 2008, contained errors. These errors, which are described below, affected the financial position, results of operations and cash flows for the quarters ended March 31, 2009 and March 31, 2008, and the fiscal year ended December 31, 2008.

A. Deferred income tax liability related to indefinite life intangible assets:

The Company’s intangible assets, comprised of its domain names, have book values in excess of their tax values. The Original Financial Statements considered the taxable temporary differences associated with these indefinite life intangible assets in reducing the valuation allowance associated with its loss carryforwards. This was an incorrect application of GAAP. A deferred tax liability should have been recognized for these taxable temporary differences. Correction of this error resulted in the recognition of a deferred tax liability of $206,370 as at March 31, 2009 and December 31, 2008. There was an immaterial effect to the consolidated statements of operations for the quarters ended March 31, 2009 and March 31, 2008.

B. Non-Controlling Interest:

The Company determined that it should have recorded $66,692 of goodwill and an increase to non-controlling interest liability associated with the exchange of $3,000,000 of amounts due from a subsidiary for additional common stock in 2008. See Note 5.

Prior to recognizing the non-controlling interest liabilities described in the preceding paragraph, the non-controlling interest’s share of subsidiary losses in 2008 was limited to the non-controlling interest liability. As a consequence of the above increase to non-controlling interest liability, the non-controlling interest’s share in subsidiary losses was increased by $51,506 during the quarter ended March 31, 2008. There was no effect to the non-controlling interest at December 31, 2008 or March 31, 2009, or for the three month period then ended.

C. Management Compensation:

(i) The March 31, 2008 financial statements did not accrue $88,287 for two CDN$250,000 special bonuses to be paid on October 1, 2008 and October 1, 2009 to the Company’s former President and Chief Operating Officer pursuant to his employment agreement. These special bonuses were not discretionary, but would only be paid if he remained employed as an officer of the Company on the dates payable. On February 4, 2009, he resigned as the Company’s President and Chief Operating Officer and employee, effective January 31, 2009. There was no effect to the March 31, 2009 financial statements.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 2 – RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS (continued)

C. Management Compensation:

(ii) The March 31, 2008 financial statements did not accrue $35,314 for two CDN$100,000 special bonuses to be paid on January 1, 2009 and January 1, 2010 to the Company’s current President and Chief Corporate Development Officer pursuant to his employment agreement. These special bonuses are not discretionary, but will only be paid if he remains employed as an officer of the Company on the dates payable. The December 31, 2008 financial statements had an underaccrual of $119,045, and the March 31, 2009 financial statements had an overaccrual of $72,741 in bonuses payable and expensed during the quarter.

D. Estimated life of stock options:

The Company originally estimated the life of its stock options as equal to the vesting period for these options, 3 years. The estimated life should have been 3.375 years, resulting in an increase of $155,500 and a decrease of $38,423 to the Company’s stock-based compensation expense in the quarters ended March 31, 2009 and March 31, 2008, respectively.

E. Other

(i) Expense accruals

The Company discovered an accrual and cutoff error in its recorded accounting fees, resulting in an underaccrual of accounts payable and accounting expense (included in Corporate General and Administrative expenses) of $83,271 and $63,750 in the quarters ended March 31, 2009 and March 31, 2008, respectively.

(ii) Gain on sale of domain name

The Company failed to record website development costs attributable to a domain name sold in December 2008, reducing website development costs and gain on sale of domain names by $37,408 in the year ended December 31, 2008. As a result, a corresponding decrease to the gain on sale of domain names in the quarter ended March 31, 2009 was adjusted. There was no effect to the consolidated balance sheet as at March 31, 2009.

F. Classification of warrants issued in November 2008 private placement:

In November 2008, the Company raised $1,057,775 of cash by selling 1,627,344 units consisting of one share of the Company’s common stock and two warrants, each for the purchase of a half share of common stock. The offering price was $0.65 per unit. The estimated fair value of the warrants was $157,895 and was originally presented as equity. The warrants contained provisions which could require their redemption in cash in certain circumstances which may not all be within the Company’s control. The fair value of the warrants therefore should have been recorded as a liability, with future changes to fair value reported as either income or expense in the period in which the change in fair value occurs. There were no changes to the fair value of the warrants between the November 2008 issue date and December 31, 2008.

At March 31, 2009, the fair value of the warrants was $242,704. The Company recorded the $84,809 increase to the liability at March 31, 2009 and the corresponding expense was recorded as an increase to corporate general and administrative expense.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 2 – RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS (continued)

G. Shares issued in connection with the merger with Auctomatic:

(i) Valuation of shares issued as purchase consideration

The Auctomatic merger closed on May 22, 2008. The original estimate of the fair value of the share purchase consideration attributable to the acquisition was based on the trading value of the shares around March 25, 2008. However, the Merger Agreement had an adjustment provision regarding the number of shares to be issued, such that the shares should have been valued with reference to the May 22, 2008 closing date as opposed to the announcement date on March 25, 2008. Using the average share price around the closing date, an additional $110,746 should have been recorded as additional paid-in capital and goodwill as at December 31, 2008.

(ii) Shares issued to Auctomatic founders

As part of the merger, the Company agreed to distribute 413,604 shares of its common stock payable on the first, second, and third anniversaries of the Closing Date (the “Distribution Date”) to the Auctomatic founders subject to their continuing employment with the Company or a subsidiary on each Distribution Date. These shares which were not accounted for in the Auctomatic purchase, also were not properly accounted for as compensation to the Auctomatic founders for their continued employment with the Company. The related stock-based compensation expense that should have been recorded was $68,330 in March 31, 2009. There was no effect to the consolidated statement of operations for the quarter ended March 31, 2008.

H. Financial Statement Classification of Amounts Payable to the BCCI and IPL:

In order to provide clarity, the Company also classified separately on its consolidated balance sheets and consolidated statements of operations the $750,000 in amounts payable to the BCCI and the IPL as at March 31, 2009 and $1,000,000 as at December 31, 2008.

I. Tax Impact:

None of the above adjustments gave rise to an increase or decrease in the Company’s tax position.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

The following table illustrates the effect of the adjustments by financial statement line item in the Company’s consolidated balance sheets as of March 31, 2009:

March 31, 2009	Reference		As previously reported			Restatement adjustment			As restated
ASSETS
Current
Cash and cash equivalents			$	572,588		$	-		$	572,588
Accounts receivable (net of allowance for doubtful accounts of nil)				100,035			-			100,035
Prepaid expenses and deposits				92,145			-			92,145
Inventory				47,421			-			47,421
Current portion of receivable from sales-type lease				23,423			-			23,423
Total current assets				835,612			-			835,612

Property & equipment				947,389			-			947,389
Website development costs				348,061			-			348,061
Intangible assets				1,557,267			-			1,557,267
Goodwill		B, G(i)		2,428,602			177,438			2,606,040
Total Assets			$	6,116,931		$	177,438		$	6,294,369

LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities		H	$	2,922,350		$	(750,000	)	$	2,172,350
Amounts payable to the BCCI and IPL		H		-			750,000			750,000
Bonuses payable		C(ii)		81,660			46,304			127,964
Due to shareholders of Auctomatic				829,799			-			829,799
Deferred revenue				78,696			-			78,696
Current portion of deferred lease inducements				20,138			-			20,138
Total current liabilities				3,932,643			46,304			3,978,947

Deferred income tax		A		-			206,370			206,370
Warrants		F		-			242,704			242,704
Deferred lease inducements				50,345			-			50,345
Total Liabilities				3,982,988			495,378			4,478,366

STOCKHOLDERS' EQUITY
Common Stock
Authorized: 50,000,000 common shares, $0.001 par value
Issued and outstanding:
23,906,445 common shares (December 31, 2008 - 23,546,370)				15,216			-			15,216
Additional paid-in capital				15,285,508			208,882			15,494,390
Accumulated deficit				(13,166,781	)		(526,822	)		(13,693,603	)
Total Stockholders' Equity				2,133,943			(317,940	)		1,816,003
Total Liabilities and Stockholders' Equity			$	6,116,931		$	177,438		$	6,294,369

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

The following table illustrates the effect of the adjustments by financial statement line item in the Company’s consolidated statements of operations as of March 31, 2009:

For the quarter ended March 31, 2009	Reference		As previously reported			Restatement adjustment			As restated

SALES			$	1,752,382		$	-		$	1,752,382

COSTS OF SALES (excluding depreciation and amortization as shown below)				1,386,619			-			1,386,619

GROSS PROFIT				365,763			-			365,763

OPERATING EXPENSES
Amortization and depreciation				98,166			-			98,166
Amortization of website development costs				32,562			-			32,562
Corporate general and administrative		E(i), F		158,274			168,080			326,354
ECommerce general and administrative				80,220			-			80,220
Management fees and employee salaries		C(i), C(ii), D, G(ii)		960,846			232,749			1,193,595
Corporate marketing				3,771			-			3,771
ECommerce marketing				111,422			-			111,422
Other expenses		C(ii)		346,564			(81,660	)		264,904
Total Operating Expenses				1,791,825			319,169			2,110,994

NON-OPERATING INCOME (EXPENSES)
Global Cricket Venture expenses		H		250,000			(250,000	)		-
Global Cricket Venture recovery		H		-			250,000			250,000
Gain from sales and sales-type lease of domain names		E(ii)		580,525			37,408			617,933
Accretion interest expense				(40,000	)		-			(40,000	)
Interest and investment income				890			-			890
Total Non-Operating Income (Expenses)				791,415			37,408			828,823

NET LOSS AND COMPREHENSIVE LOSS FOR THE PERIOD			$	(634,647	)	$	(281,761	)	$	(916,408	)

BASIC AND DILUTED LOSS PER SHARE			$	(0.03	)	$	(0.01	)	$	(0.04	)

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING - BASIC AND DILUTED				22,509,120			-			22,509,120

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

The following table illustrates the effect of the adjustments by financial statement line item in the Company’s consolidated statements of equity as of March 31, 2009:

		As previously reported
		Common stock					Additional Paid-in Capital			Accumulated Deficit			Total			Restatement Adjustment			As Restated Total
	Reference	Number of Shares			Amount
Balance, December 31, 2007 (audited)		21,446,623			12,456		10,188,975			(2,525,678	)		7,675,753			(283,218	)		7,392,535
Stock-based compensation	D, G(ii)	-			-		2,111,354						2,111,354			51,172			2,162,526
Issuance of 586,403 common shares per the merger agreement with Auctomatic	G(i)	586,403			586		1,137,533						1,138,119			110,746			1,248,865
Issuance of 33,000 common shares to investor relations firm		33,000			33		85,649						85,682			-			85,682
Issuance of 120,000 common shares to investor relations firm		120,000			120		218,057						218,177			-			218,177
Issuance of 50,000 warrants to investor relations firm		-			-		45,500						45,500			-			45,500
Cancellation of 300,000 common shares not distributed		(300,000	)		-		-						-			-			-
Private Placement of 1,627,344 units at $0.65 per share	F	1,627,344			1,627		1,056,148						1,057,775			(157,895	)		899,880
Share issue costs		-			-		(86,803	)					(86,803	)		-			(86,803	)
Extinguishment of accounts payable		33,000			33		16,467						16,500			-			16,500
Net loss and comprehensive loss	A - E(ii), G(ii)									(10,006,456	)		(10,006,456	)		19,186			(9,987,270	)
Balance, December 31, 2008 (audited)		23,546,370		$	14,855	$	14,772,880		$	(12,532,134	)	$	2,255,601		$	(260,009	)	$	1,995,592
Stock-based compensation	D, G(ii)	-			-		386,513						386,513			223,830			610,343
Issuance of 15,000 common shares to investor relations firm		15,000			15		5,685						5,700			-			5,700
Extinguishment of accounts payable		345,075			346		120,430						120,776			-			120,776
Net loss and comprehensive loss	C(ii), D, E(i), E(ii), F, G(ii)									(634,647	)		(634,647	)		(281,761	)		(916,408	)
Balance, March 31, 2009 (unaudited)		23,906,445		$	15,216	$	15,285,508		$	(13,166,781	)	$	2,133,943		$	(317,940	)	$	1,816,003

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

The following table illustrates the effect of the adjustments by financial statement line item in the Company’s consolidated statements of cash flows as of March 31, 2009:

For the quarter ended March 31, 2009	Reference	As previously reported			Restatement adjustment			As restated
OPERATING ACTIVITIES
Net loss for the period		$	(634,647	)	$	(281,761	)	$	(916,408	)
Non-cash items included in net loss:
Gain from sales and sales-type lease of domain name	E(ii)		(580,525	)		(37,408	)		(617,933	)
Accretion interest expense			40,000			-			40,000
Stock-based compensation	D, G(ii)		386,513			223,830			610,343
Warrants issued	F		-			84,809			84,809
Issuance of common stock			5,700			-			5,700
Extinguishment of debt by issuance of common stock			120,776			-			120,776
Amortization and depreciation			125,693			-			125,693
Change in operating assets and liabilities:
Accounts receivable			(6,453	)		-			(6,453	)
Prepaid expenses and deposits			17,398			-			17,398
Inventory			26,661			-			26,661
Accounts payable and accrued liabilities	H		(1,444,566	)		333,271			(875,645	)
Amounts payable to the BCCI and IPL	H		-			(250,000	)		(250,000	)
Bonuses payable	C(i), C(ii)		81,660			(72,741	)		(226,731	)
Deferred revenue			(41,760	)		-			(41,760	)
Cash flows used in operating activities			(1,903,550	)		-			(1,903,550	)

INVESTING ACTIVITIES
Net proceeds from sale of domain name			358,130			-			358,130
Net proceeds from sales-type lease of domain name			313,423			-			313,423
Purchases of property & equipment			(2,704	)		-			(2,704	)
Website development costs			(25,231	)		-			(25,231	)
Cash flows from investing activities			643,618			-			643,618

Net increase (decrease) in cash and cash equivalents			(1,259,932	)		-			(1,259,932	)

Cash and cash equivalents, beginning of period			1,832,520			-			1,832,520
Cash and cash equivalents, end of period		$	572,588		$	-		$	572,588

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

The following is a summary of the significant effects of the restatements on the Company’s comparative consolidated statements of operations for the three months ended March 31, 2008:

For the quarter ended March 31, 2008	Reference		As previously reported			Restatement adjustment			As restated

SALES			$	1,848,479		$	-		$	1,848,479

COSTS OF SALES (excluding depreciation and amortization as shown below)				1,486,062			-			1,486,062

GROSS PROFIT				362,417			-			362,417

OPERATING EXPENSES
Amortization and depreciation				15,266			-			15,266
Corporate general and administrative		E(i)		486,087			63,750			549,837
ECommerce general and administrative				169,813			-			169,813
Management fees and employee salaries		C(i), C(ii), D, G(ii)		1,090,671			85,179			1,175,850
Corporate marketing				26,459			-			26,459
ECommerce marketing				149,187			-			149,187
Other expenses				629,856			-			629,856
Total Operating Expenses				2,567,339			148,929			2,716,268

NON-OPERATING INCOME (EXPENSES)
Gain from sales and sales-type lease of domain names				168,206			-			168,206
Interest and investment income				42,498			-			42,498
Non-controlling interest		B		-			51,506			51,506
Total Non-Operating Income (Expenses)				210,704			51,506			262,210

NET LOSS AND COMPREHENSIVE LOSS FOR THE PERIOD			$	(1,994,218	)	$	(97,423	)	$	(2,091,641	)

BASIC AND DILUTED LOSS PER SHARE			$	(0.10	)	$	(0.00	)	$	(0.10	)

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING - BASIC AND DILUTED				19,970,334			-			19,970,334

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

The following is a summary of the significant effects of the restatements on the Company’s comparative consolidated statements of cash flows for the three months ended March 31, 2008:

For the quarter ended March 31, 2008	Reference	As previously reported			Restatement adjustment			As restated
OPERATING ACTIVITIES
Net loss for the period		$	(1,994,218	)	$	(97,423	)	$	(2,091,641	)
Non-cash items included in net loss:
Non-controlling interest			-			(51,506	)		(51,506	)
Gain from sales and sales-type lease of domain names	E(ii)		(168,206	)		-			(168,206	)
Stock-based compensation	D, G(ii)		482,144			(38,423	)		443,721
Amortization and depreciation			10,231			-			10,231
Change in operating assets and liabilities:
Accounts receivable			(3,290	)		-			(3,290	)
Prepaid expenses and deposits			81,112			-			81,112
Accounts payable and accrued liabilities	E(i)		(92,347	)		63,750			(28,597	)
Bonuses payable	C(ii)		(241,290	)		123,602			(117,688	)
Deferred revenue			(33,435	)		-			(33,435	)
Cash flows used in operating activities			(1,959,299	)		-			(1,959,299	)

INVESTING ACTIVITIES
Net proceeds from sales-type lease of domain name			23,423			-			23,423
Accrued expenses relating to deferred acquisition costs			(111,265	)		-			(111,265	)
Deferred acquisition costs			(121,265	)		-			(121,265	)
Purchases of property & equipment			(154,069	)		-			(154,069	)
Website development costs			(147,025	)		-			(147,025	)
Cash flows used in investing activities			(510,201	)		-			(510,201	)

Net increase (decrease) in cash and cash equivalents			(2,469,500	)		-			(2,469,500	)

Cash and cash equivalents, beginning of period			7,375,245			-			7,375,245
Cash and cash equivalents, end of period		$	4,905,745		$	-		$	4,905,745

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies used in preparation of these consolidated financial statements:

Principles of consolidation

The consolidated financial statements include the accounts of the Company, its wholly owned subsidiary Delaware, its wholly-owned subsidiary LCM Cricket Ventures, its 98.2% (December 31, 2008 – 98.2%) interest in its subsidiary DHI, DHI’s wholly owned subsidiaries Importers and 612793, and LCM Cricket Ventures’ 50.05% interest in Global Cricket Venture. All significant intercompany balances and transactions are eliminated on consolidation.

Use of estimates

The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of intangible assets, fair value measurement, related party transactions, stock based compensation, determination and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and for the periods that the consolidated financial statements are prepared. Actual results could differ from these estimates.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Business Combinations

On the acquisition of a subsidiary, the purchase method of accounting is used whereby the purchase consideration is allocated to the identifiable assets and liabilities on the basis of fair value at the date of acquisition. The Company considers critical estimates involved in determining any amount of goodwill, and tests for impairment of such goodwill as disclosed in its Goodwill accounting policy below.

Revenue recognition

Revenues and associated costs of goods sold from the on-line sales of products, currently consisting primarily of fragrances and other beauty products, are recorded upon delivery of products and determination that collection is reasonably assured. The Company records inventory as an asset for items in transit as title does not pass until received by the customer. All associated shipping and handling costs are recorded as cost of goods sold upon delivery of products.

Web advertising revenue consists primarily of commissions earned from the referral of visitors from the Company’s websites to other parties. The amount and collectibility of these referral commissions is subject to uncertainty; accordingly, revenues are recognized when the amount can be determined and collectibility can be reasonably assured. In accordance with Emerging Issues Task Force (“EITF”) 99-19, Reporting Revenue Gross as a Principal versus Net as an Agent, the Company records web advertising revenues on a gross basis.

Gains from the sale of domain names, whose carrying values are recorded as intangible assets, consist primarily of funds earned for the transfer of rights to domain names that are currently in the Company’s control. Revenues have been recognized when the sale agreement is signed, the price is fixed and agreed upon by all parties, and the collectibility of the proceeds is reasonably assured. In the first quarter of 2009, there was a sale of one domain name. Collectibility of the amounts owing on this sale is reasonably assured and therefore accounted for as a sale in the period the transaction occurred. In 2008, there was one sale of a domain name. Collectibility of the amounts owing on this sale is reasonably assured and therefore accounted for as a sale in the period the transaction occurred.

Gains from the sales-type leases of domain names, whose carrying values are recorded as intangible assets, consist primarily of funds earned over a period of time for the transfer of rights to domain names that are currently in the Company’s control. When collectibility of the proceeds on these transactions is reasonably assured, the gain on sale is accounted for as a sales-type lease in the period the transaction occurs. In the first quarter of 2009, there was one sales-type lease of a domain name. In 2008, there was one sales-type lease of a domain name. See also Note 12.

Foreign currency transactions

The consolidated financial statements are presented in United States dollars. The functional currency of the Company is United States dollars. In accordance with FAS 52, Foreign Currency Translation , the foreign currency financial statements of the Company’s subsidiaries are translated into U.S. dollars. Monetary assets and liabilities are translated using the foreign exchange rate that prevailed at the balance sheet date. Revenue and expenses are translated at weighted average rates of exchange during the year and stockholders’ equity accounts and certain other historical cost balances are translated by using historical exchange rates. Any resulting exchange gains and losses are presented as cumulative foreign currency translation gains (losses) within other accumulated comprehensive loss. There was no effect to comprehensive loss related to the share conversion with DHI.

Transactions denominated in foreign currencies are remeasured at the exchange rate in effect on the respective transaction dates and gains and losses are reflected in the consolidated statements of operations.

Comprehensive loss

Comprehensive loss includes all changes in equity of the Company during a period except those resulting from investments by shareholders and distributions to shareholders. Comprehensive loss includes net loss and other comprehensive loss (“OCL”). The major components included in OCL are cumulative translation adjustments arising on the translation of the financial statements of self-sustaining foreign operations and unrealized gains and losses on financial assets classified as available-for-sale. The Company has no self-sustaining foreign operations or unrealized gains or losses on financial assets classified as available-for-sale.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Loss per share

Basic loss per share is computed by dividing losses for the period by the weighted average number of common shares outstanding for the period. Diluted loss per share reflects the potential dilution of securities by including other potential common stock in the weighted average number of common shares outstanding for a period and is not presented where the effect is anti-dilutive.

Cash and cash equivalents

The Company considers all highly liquid instruments, with original maturity dates of three months or less at the time of issuance, to be cash equivalents.

Accounts receivable and allowance for doubtful accounts

The Company’s accounts receivable balance consists primarily of goods and services taxes (GST) receivable and advertising revenues receivable. Per the Company’s review of open accounts and collection history, the accounts receivable balances are reasonably collectible and therefore no allowance for doubtful accounts has been reflected at quarter end.

Inventory

Inventory is recorded at the lower of cost or market using the first-in first-out (FIFO) method. The Company maintains little or no inventory of perfume which is shipped from the supplier directly to the customer. The inventory on hand as at March 31, 2009 is recorded at cost of $47,421 (December 31, 2008 - $74,082) and represents inventory in transit from the supplier to the customer.

Property & Equipment

These assets are stated at cost. Minor additions and improvements are charged to operations, and major additions are capitalized. Upon retirement, sale or other disposition, the cost and accumulated depreciation are eliminated from the accounts, and a gain or loss is included in operations.

Amortization for equipment is computed using declining balance method at the following annual rates:

	Office Furniture and Equipment	20%
	Computer Equipment	30%
	Computer Software	100%
	Auction Software	3 years straight-line

Amortization for leasehold improvements is based on a straight-line method calculated over the term of the lease. Auction software is amortized straight line over the life of the asset. Other additions are amortized on a half-year basis in the year of acquisition.

Website development costs

The Company has adopted the provisions of EITF No. 00-2, Accounting for Web Site Development Costs , whereby costs incurred in the preliminary project phase are expensed as incurred; costs incurred in the application development phase are capitalized; and costs incurred in the post-implementation operating phase are expensed as incurred. Website development costs are stated at cost less accumulated amortization and are amortized using the straight-line method over its estimated useful life. Upgrades and enhancements are capitalized if they result in added functionality which enables the software to perform tasks it was previously incapable of performing. See also Note 9.

Intangible assets

The Company has adopted the provisions of FAS No. 142, Goodwill and Intangible Assets , which revises the accounting for purchased goodwill and intangible assets. Under FAS 142, intangible assets with indefinite lives are no longer amortized and are tested for impairment annually. The determination of any impairment would include a comparison of estimated future operating cash flows anticipated during the remaining life with the net carrying value of the asset as well as a comparison of the fair value to book value of the Company.

The Company’s intangible assets, which consist of its portfolio of generic domain names, have been determined to have an indefinite life and as a result are not amortized. Management has determined that there is no impairment of the carrying value of intangible assets at March 31, 2009.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Goodwill

Goodwill represents the excess of acquisition cost over the fair value of the net assets of acquired entities. In accordance with FAS No. 142, Accounting for Goodwill and Other Intangible Assets, the Company is required to assess the carrying value of goodwill annually or whenever circumstances indicate that a decline in value may have occurred, utilizing a fair value approach at the reporting unit level. A reporting unit is the operating segment, or a business unit one level below that operating segment, for which discrete financial information is prepared and regularly reviewed by segment management.

The goodwill impairment test is a two-step impairment test. In the first step, the Company compares the fair value of each reporting unit to its carrying value. The Company determines the fair value of its reporting units using a discounted cash flow approach. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that reporting unit, goodwill is not impaired and the Company is not required to perform further testing. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then the Company must perform the second step in order to determine the implied fair value of the reporting unit’s goodwill and compare it to the carrying value of the reporting unit’s goodwill. The activities in the second step include valuing the tangible and intangible assets and liabilities of the impaired reporting unit based on their fair value and determining the fair value of the impaired reporting unit’s goodwill based upon the residual of the summed identified tangible and intangible assets and liabilities.

The Company assessed the carrying value of goodwill at the December 31, 2008 fiscal year end, and there are no indications that a decline in value may have occurred to March 31, 2009. At that date, the fair value of the Perfume.com reporting unit exceeded the carrying value of the assigned net assets, therefore no further testing was required and an impairment charge was not required.

Deferred Revenue

Revenue that has been received but does not yet qualify for recognition under the Company's policies is reflected as either deferred revenue or long-term deferred revenue.

Deferred Lease Inducements

Lease inducements, including rent free periods, are deferred and accounted for as a reduction of rent expense over the term of the related lease on a straight-line basis.

Advertising Costs

The Company recognizes advertising expenses in accordance with SOP 93-7, Reporting on Advertising Costs . As such, the Company expenses the costs of producing advertisements at the time production occurs or the first time the advertising takes place and expenses the cost of communicating advertising in the period during which the advertising space or airtime is used. Internet advertising expenses are recognized as incurred based on the terms of the individual agreements, which are generally: 1) a commission for traffic driven to the Website that generates a sale or 2) a referral fee based on the number of clicks on keywords or links to the Company’s Website generated during a given period. Total advertising expense for the quarter ended March 31, 2009 of $113,876 (quarter ended March 31, 2008 - $175,646) is included in the “Corporate Marketing” and “eCommerce Marketing” categories on the Company’s consolidated statements of operations.

Stock-based compensation

During the third quarter of 2007, the Company implemented the following new critical accounting policy related to its stock-based compensation. Beginning on July 1, 2007, the Company began accounting for stock options under the provisions of Financial Accounting Standards No. 123 (revised 2004), Share-Based Payment (FAS 123(R)), which requires the recognition of the fair value of stock-based compensation. Under the fair value recognition provisions for FAS 123(R), stock-based compensation cost is estimated at the grant date based on the fair value of the awards expected to vest and recognized as expense ratably over the requisite service period of the award. The Company has used the Black-Scholes valuation model to estimate fair value of its stock-based awards which requires various judgmental assumptions including estimating stock price volatility and expected life. The Company’s computation of expected volatility is based on a combination of historical and market-based volatility. In addition, the Company considers many factors when estimating expected life, including types of awards and historical experience. If any of the assumptions used in the Black-Scholes valuation model change significantly, stock-based compensation expense may differ materially in the future from that recorded in the current period.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Stock-based compensation (continued)

In August 2007, the Company’s Board of Directors approved an Incentive Stock Option Plan to make available 5,000,000 shares of common stock for the grant of stock options, including incentive stock options. Incentive stock options may be granted to employees of the Company, while non-qualified stock options may be granted to employees, officers, directors, consultants, independent contractors and advisors of the Company, provided such consultants, independent contractors and advisors render bona-fide services not in connection with the offer and sale of securities in a capital-raising transaction or promotion of the Company’s securities. See also Note 11.

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FAS 123(R) and the conclusions reached by the EITF in Issue No. 96-18. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by EITF 96-18.

On March 25, 2009, the Board of Directors approved a reduction in the exercise price of Stock Option grants previously made under the 2007 Incentive Stock Option Plan. No other terms of the plan or the grants were modified. See also Note 11(d).

Non-Controlling Interest

The consolidated financial statements include the accounts of DHI (and its subsidiaries). All intercompany accounts and transactions have been eliminated upon consolidation. The Company records non-controlling interest which reflects the 1.8% portion of the earnings of DHI and its subsidiaries allocable to the holders of the minority interest.

Income taxes

On January 1, 2007, the Company adopted the following new critical accounting policy related to income tax. The Company began accounting for income tax under the provisions of Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes-an interpretation of FASB Statement No. 109 (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FASB Statement 109, Accounting for Income Taxes , and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. 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. The Company’s evaluation was performed for the tax years ended December 31, 2002, 2003, 2004, 2005, 2006, 2007 and 2008, the tax years which remain subject to examination by major tax jurisdictions as of December 31, 2008. The Company also evaluated the quarter ended March 31, 2009. The Company may from time to time be assessed interest or penalties by major tax jurisdictions, although any such assessments historically have been minimal and immaterial to the Company’s financial results. In the event the Company has received an assessment for interest and/or penalties, it has been classified in the financial statements as selling, general and administrative expense.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent Accounting Pronouncements

FAS 168

In June, 2009, the FASB issued FAS No. 168, The FASB Accounting Standards Codification TM and the Hierarchy of Generally Accepted Accounting Principles – A Replacement of FASB Statement No. 162. The FASB Accounting Standards Codification TM (Codification) will become the source of authoritative U.S. generally accepted accounting principles (GAAP) recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of this Statement, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other nongrandfathered non-SEC accounting literature not included in the Codification will become nonauthoritative. This statement is effective for financial statements issued for fiscal years and interim periods beginning after September 15, 2009, which, for the Company, would be the fiscal year beginning January 1, 2010. The Company is currently assessing the impact of FAS No. 168 on its financial position and results of operations.

FAS 166

In June, 2009, the FASB issued FAS No. 166, Accounting for Transfer of Financial Assets – An Amendment of FASB Statement No. 140. The new standard is intended to improve the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets: the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor’s continuing involvement, if any, in transferred financial assets. This statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2009, which, for the Company, would be the fiscal year beginning January 1, 2010. The Company is currently assessing the impact of FAS No. 166 on its financial position and results of operations.

FAS 165

In May, 2009, the FASB issued FAS No. 165, Subsequent Events. The new standard is intended to establish general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. This statement is effective for financial statements issued for interim or annual financial periods ending after June 15, 2009, which, for the Company, would be the interim period ending June 30, 2009. The Company does not expect that this Statement will result in a change in current practice.

FAS 162

In May, 2008, the FASB issued FAS 162, The Hierarchy of Generally Accepted Accounting Principles. The new standard is intended to improve financial reporting by identifying a consistent framework, or hierarchy, for selecting accounting principles to be used in preparing financial statements that are presented in conformity with U.S. generally accepted accounting principles (GAAP) for non-governmental entities. This Statement is effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board amendments to AU Section 411, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles . The Company does not expect that this Statement will result in a change in current practice.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Recently Adopted Accounting Pronouncements

FAS 161

In March 2008, the FASB issued FAS 161, Disclosures about Derivative Instruments and Hedging Activities , an amendment of FAS 133 . FAS 161 is intended to improve financial standards for derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity's financial position, financial performance and cash flows. Entities are required to provide enhanced disclosures about: how and why an entity uses derivative instruments; how derivative instruments and related hedged items are accounted for under FAS 133 and its related interpretations; and how derivative instruments and related hedged items affect an entity's financial position, financial performance and cash flows. FAS 161 was effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, which for the Company was the fiscal year beginning January 1, 2009. The Company adopted FAS 161 at January 1, 2009, however the adoption of this statement did not have a material effect on its financial results.

FSP FAS 142-3

In April 2008, the FASB issued FASB Staff Position (“FSP”) FAS 142-3, Determination of the Useful Life of Intangible Assets . FSP FAS 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under FAS 142, Goodwill and Other Intangible Assets . The intent of FSP FAS 142-3 is to improve the consistency between the useful life of a recognized intangible asset under FAS 142 and the period of expected cash flows used to measure the fair value of the asset under FAS 141(R) and other applicable accounting literature. FSP FAS 142-3 was effective for financial statements issued for fiscal years beginning after December 15, 2008, which for the Company was the fiscal year beginning January 1, 2009. The Company adopted FAS 142-3 at January 1, 2009, however the adoption of this statement did not have a material effect on its financial results.

FAS 141(R)

In December 2007, the FASB issued FAS 141 (revised 2007), Business Combinations ("FAS 141(R)"). FAS 141(R) significantly changes the accounting for business combinations in a number of areas including the treatment of contingent consideration, preacquisition contingencies, transaction costs, in-process research and development and restructuring costs. In addition, under FAS 141(R), changes in an acquired entity's deferred tax assets and uncertain tax positions after the measurement period will impact income tax expense. This standard will change accounting treatment for business combinations on a prospective basis. FAS 141(R) was effective for financial statements issued for fiscal years and interim periods beginning after December 15, 2008, which for the Company was the fiscal year beginning January 1, 2009. The Company adopted FAS 141(R) at January 1, 2009, however the adoption of this statement did not have a material effect on its financial results.

FAS 160

In December 2007, the FASB issued FAS 160 Noncontrolling Interests in Consolidated Financial Statements , and simultaneously revised FAS 141 Business Combinations . This Statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008, which for the Company was the fiscal year beginning January 1, 2009. An entity may not adopt the policy before the transitional date. The Company adopted FAS 160 at January 1, 2009, however the adoption of this statement did not have a material effect on its financial results.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Recently Adopted Accounting Pronouncements (continued)

FAS 157

In September 2006, the FASB issued FAS 157, Fair Value Measurements . This Statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. This standard does not require any new fair value measurements.

In 2008, the Company adopted FAS 157 for financial assets and liabilities recognized at fair value on a recurring basis. The adoption did not have a material effect on its financial results. The disclosures required by FAS 157 for financial assets and liabilities measured at fair value on a recurring basis as at December 31, 2008 are included in Note 4.

In February 2008, the FASB issued FSP FAS 157-2, which delays the effective date of FAS 157 to fiscal years beginning after November 15, 2008 for nonfinancial assets and nonfinancial liabilities, except for those items that are recognized or disclosed at fair value in the financial statements on a recurring basis, which for the Company was the fiscal year beginning January 1, 2009.

The Company applied the requirements of FAS 157 for fair value measurements of financial and nonfinancial assets and liabilities not valued on a recurring basis at January 1, 2009. The adoption of this statement did not have a material effect on its financial reporting and disclosures.

In October 2008, the FASB issued FSP FAS 157-3, Determining the Fair Value of a Financial Asset When the Market for that Asset is Not Active , which clarifies the application of FAS 157 in determining the fair value of a financial asset when the market for that asset is not active. FSP FAS 157-3 is effective as of the issuance date and has not affected the valuation of its financial assets.

NOTE 4 – FINANCIAL INSTRUMENTS

Interest rate risk exposure

The Company currently has limited exposure to any fluctuation in interest rates.

Foreign exchange risk

The Company is subject to foreign exchange risk for sales and purchases denominated in foreign currencies. Foreign currency risk arises from the fluctuation of foreign exchange rates and the degree of volatility of these rates relative to the United States dollar. The Company does not actively manage this risk.

Concentration of credit risk

Financial instruments, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents, trade accounts receivable and receivable from sales-type lease. The Company limits its exposure to credit loss by placing its cash and cash equivalents on deposit with high credit quality financial institutions. Receivables arising from sales to customers are generally immaterial and are not collateralized. Management regularly monitors the financial condition of its customers to reduce the risk of loss.

Fair values of Financial Instruments

As described in Note 3, the Company adopted all provisions of FAS 157 as of January 1, 2009. FAS 157 defines fair value, establishes a consistent framework for measuring fair value, and expands disclosures for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. FAS 157 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, FAS 157 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 4 – FINANCIAL INSTRUMENTS (continued)

Fair values of Financial Instruments (continued)

Level 1 - observable inputs such as quoted prices in active markets for identical assets and liabilities;

Level 2 - observable inputs such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, other inputs that are observable, or can be corroborated by observable market data; and

Level 3 - unobservable inputs for which there are little or no market data, which require the reporting entity to develop its own assumptions.

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, receivable from sales-type lease, accounts payable, amounts payable to the BCCI and IPL, bonuses payable, amounts due to shareholders of Auctomatic and warrants. The Company did not elect to value its financial assets or liabilities in accordance with FAS 159. The Company believes that the recorded values of all of its financial instruments approximate their fair values because of their nature and respective durations.

NOTE 5 – NON-CONTROLLING INTEREST

The Company currently holds 98.2% (December 31, 2008 – 98.2%) of the issued and outstanding shares of its principal operating subsidiary, DHI. During Q1 2008, DHI issued 40,086,645 shares to Live Current Media Inc. at fair value in exchange for a conversion of intercompany debt of $3,000,000, therefore diluting the non-controlling interest by 3.3%. This conversion was accounted for using the purchase method, resulting in an increase to goodwill of $66,692, and a credit against the non-controlling interest of $51,506 charged to income during the quarter ended March 31, 2008.

The continued losses of DHI have resulted in a debit balance of $24,007 in the NCI balance at March 31, 2009.

NOTE 6 – GLOBAL CRICKET VENTURE

Memoranda of Understanding

On April 17, 2008, the Company signed a Memorandum of Understanding (“MOU” or “Original MOU”) with the Board of Control for Cricket in India (“BCCI”) and the DLF Indian Premier League (“IPL”). The MOU started the Company’s planned exploitation of its cricket.com domain name.

Certain other subsidiaries and ventures have been incorporated or formed to further this business opportunity, however none of them have significant assets or operations to date, nor have any material binding contracts been signed.

The Company incurred approximately $227,000 during the first quarter of 2009 and $1.47 million during the year ended December 31, 2008, in furtherance of this plan, included in corporate marketing, management fees and employee salaries, and corporate general and administrative expenses. The Company also incurred $750,000 of liabilities in aggregate to the BCCI and IPL in respect of exclusive online content rights agreements as at March 31, 2009. As the plan to exploit cricket.com was in its early stages, all expenditures were charged to operations.

In March 2009 the Company and the BCCI terminated the BCCI MOU and the Company transferred and assigned all of its interest in the IPL MOU to GCV, which assumed the liabilities in accordance with the terms of a Novation. In August 2009, GCV and DHI transferred and assigned all of its interests in the project, including the ownership of the cricket.com domain name, for cash and assumption by the third party of all past and future liabilities of GCV arising from the original MOU, as it was amended by the Novation. Refer to Note 19.

We accounted for our economic obligations to the BCCI and IPL based on the schedule of payments defined by the MOUs by accruing individual payments as liabilities based on the payment schedule, and expensed such payments in the related period as a current expense as the minimum guaranteed payments owing to the BCCI and IPL had no future benefit to the Company.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 7 – MERGER AGREEMENT

On March 25, 2008, the Company and its wholly owned subsidiary, Communicate.com Delaware, Inc. (“Delaware”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Entity, Inc., a Delaware corporation, (“Auctomatic”).

The Merger Agreement closed on May 22, 2008 (the “Closing Date”). In connection with the Merger Agreement, the stockholders of Auctomatic received in total (i) $2,000,000 cash minus $152,939 in certain assumed liabilities and (ii) 1,000,007 shares of common stock of the Company (equal to $3,000,000 divided by $3.00 per share, the closing price of the Company’s common stock on the business day immediately preceding the Closing Date) in exchange for all the issued and outstanding shares of Auctomatic.

The consideration was payable as follows: (i) 340,001 shares, or 34%, of the common stock and (ii) $1,200,000 less $152,939 in assumed liabilities. An additional 246,402 shares of common stock were issued and shall be distributed in equal amounts to the Auctomatic shareholders on each of the first, second and third anniversaries of the Closing Date. The remaining $800,000 of the total Cash Consideration was to be distributed on the first anniversary of the Closing Date. All amounts of cash and common stock are to be distributed pro rata among the Auctomatic Stockholders.

The distribution of the remaining 413,604 shares of the common stock payable on the first, second and third anniversaries of the Closing Date to the Auctomatic founders is subject to their continuing employment with the Company or a subsidiary on each Distribution Date. As these shares are contingent on future employment, they are considered contingent consideration and are required to be accounted for under FAS 123(R) as stock-based compensation. In the first quarter of 2009, one of the founders resigned from Live Current, and therefore the distribution of 137,868 shares of the common stock on the first, second and third anniversaries will no longer be payable. The remaining 275,736 shares of the common stock owing to the other founders remain payable on the anniversary dates as noted above. See also Note 11 and Note 19.

At May 22, 2008, the present value of the amounts payable in cash to shareholders of Auctomatic on the first anniversary of the closing date was $640,000. In the first quarter of 2009, the present value discount was accreted by $40,000 (2008 - $96,700), leaving a present value remaining at March 31, 2009 of $776,700.

At March 31, 2009, $53,099 of cash owing at closing has yet to be paid to one of the Auctomatic shareholders. This payment was made subsequent to quarter end. As a result, amounts payable to shareholders of Auctomatic totaled $829,799.

The purchase price to affect the merger was allocated as following on the Closing Date:

Purchase Price Paid

Cash (net of assumed liabilities)	$	1,046,695
Transaction Costs		387,358

Cash consideration for Auctomatic		1,434,053

Present value of shares of common stock paid and payable to shareholders of Auctomatic		1,248,865
Present value of amounts payable to shareholders of Auctomatic		640,000

Total	$	3,322,918

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 7 – MERGER AGREEMENT (continued)

Net Assets Acquired

Assets
Cash	$	3,066
Share subscriptions receivable		780
Computer hardware		7,663
Auction software		925,000
Goodwill		2,539,348
Less Liabilities
Accounts payable and accrued liabilities		(85,622	)
Loan payable		(67,317	)

Net Assets Acquired	$	3,322,918

To show effect to the merger of Auctomatic and Delaware as if the merger had occurred on January 1, 2008, the pro forma information for the nine months ended December 31, 2008 would have resulted in revenues that remain unchanged from those reported in the consolidated financial statements, no cumulative effect of accounting changes, and income before extraordinary items and net income which both would have decreased by $106,035. See Note 19.

NOTE 8 – PROPERTY & EQUIPMENT

March 31, 2009 (as Restated)	Cost		Accumulated Amortization		Net Book Value
Office Furniture and Equipment	$	165,868	$	37,532	$	128,336
Computer Equipment		103,493		55,348		48,145
Computer Software		27,276		17,048		10,228
Auction Software		925,000		256,944		668,056
Leasehold Improvements		142,498		49,874		92,624
	$	1,364,135	$	416,746	$	947,389

December 31, 2008 (as Restated)	Cost		Accumulated Amortization		Net Book Value
Office Furniture and Equipment	$	165,868	$	30,778	$	135,090
Computer Equipment		100,789		51,554		49,235
Computer Software		27,276		13,638		13,638
Auction Software		925,000		179,861		745,139
Leasehold Improvements		142,498		42,749		99,749
	$	1,361,431	$	318,580	$	1,042,851

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 9 – WEBSITE DEVELOPMENT COSTS

Website development costs are related to infrastructure development of various websites that the Company operates. In previous years, costs qualifying for capitalization were immaterial and therefore were expensed as incurred. Website maintenance, training, data conversion and business process reengineering costs are expensed in the period in which they are incurred. Costs incurred in the application development phase are capitalized, and when the related websites reach the post-implementation operating phase, the Company begins amortizing these costs on a straight-line basis over 36 months beginning in the month following the implementation of the related websites.

	March 31, 2009 (As Restated)			December 31, 2008 (As Restated)
Website Development Costs	$	430,233		$	405,001
Less: Accumulated Amortization		(82,172	)		(49,610	)
	$	348,061		$	355,391

During the quarter, the Company capitalized website development costs of $25,231.

NOTE 10 – DEFERRED LEASE INDUCEMENTS

	March 31, 2009 (As Restated)			December 31, 2008 (As Restated)
Deferred Lease Inducements	$	70,483		$	75,518
Less: Current Portion		(20,138	)		(20,138	)
	$	50,345		$	55,380

NOTE 11 – COMMON STOCK

a) Authorized

The authorized capital of the Company consists of 50,000,000 common shares with a par value of $0.001 per share. No other shares have been authorized.

b) Issued

At March 31, 2009, there were 23,906,445 (December 31, 2008 – 23,546,370) shares issued and outstanding.

2009

On January 2, 2009, the Company issued 15,000 shares with a value of $5,700 to the investor relations firm that was engaged to provide investor relations services to the Company. This was the Company’s final share issuance to this investor relations firm. The agreement has since been terminated.

On January 8, 2009, the Company entered into an agreement whereby $120,776 of its accounts payable were extinguished in exchange for the issuance of 345,075 shares of its common stock. As a result of this agreement, 172,538 shares were issued on January 22, 2009 and 172,537 shares were issued on February 20, 2009.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 11 – COMMON STOCK (continued)

b) Issued (continued)

2008

The Company issued 50,000 warrants to an investor relations firm in May 2008, and expensed $45,500 in relation to the value of the warrants. See also Note 11(e).

In June 2008, the Company issued 586,403 shares of common stock in relation to the May 22, 2008 merger with Auctomatic. Of those total issued shares, 340,001 shares were distributed to the shareholders and an additional 246,402 shares are being held for future distribution in three equal installments on the next three anniversary dates of the merger pursuant to the terms of the merger agreement. The value of the stock consideration was added to the cash consideration in the Company’s determination of the purchase price. See also Note 7. The remaining 413,604 shares of common stock are reserved for future issuance to the Auctomatic founders and are being accounting for as stock-based compensation pursuant to FAS 123(R). See also Note 11(c) and Note 11(d).

In May and June 2008, the Company issued 45,000 shares to an investor relations firm that had been engaged to provide investor relations services to the Company. Of the 45,000 shares, 30,000 shares with a value of $85,350 were issued as partial consideration for services rendered, while the remaining 15,000 shares with an estimated value of $42,300 were recorded as a prepaid expense in June 2008 for services to be rendered in July 2008. In July 2008, this amount was revalued to $36,573 based on the July average stock price and expensed with the difference between the estimated and actual values adjusted to Additional Paid-In Capital.

In August 2008, the Company issued 33,000 shares to an investor relations firm that had previously been engaged to provide investor relations services to the Company. The contract with this former investor relations firm terminated August 1, 2008. The 33,000 shares owing to the firm had a value of $85,682 and were issued as full consideration for services rendered.

In August and September 2008, the Company issued 30,000 shares to an investor relations firm that had been engaged to provide investor relations services to the Company. These shares, which were valued at $57,254, were issued as partial consideration for services rendered during the year.

In October 2008, the Company cancelled 300,000 shares of common stock that had been pre-maturely issued in a prior year in anticipation of a transaction that was never consummated.

During November 2008, the Company accepted subscriptions from 11 accredited investors pursuant to which the Company issued and sold 1,627,344 units consisting of one share of the Company’s common stock and two warrants, each for the purchase of one-half a share of common stock. The price per unit was $0.65. The Company raised gross proceeds of $1,057,775 (the “Offering”). The private placement closed on November 19, 2008. One warrant is exercisable at $0.78 (a 20% premium) and expires November 19, 2010. The other warrant is exercisable at $0.91 (a 40% premium) and expires November 19, 2011. The Company incurred $86,803 in share issuance costs related to the private placement. The Company filed an S-1 Registration Statement with the SEC on May 1, 2009 to register for resale the common stock and the common stock underlying the warrants. The securities were offered and sold by the Company to accredited investors in reliance on Section 506 of Regulation D of the Securities Act of 1933, as amended. Refer to Note 11(e).

In December 2008, the Company extinguished $16,500 of accounts payable by issuing 33,000 shares to the investor relations firm that had previously been engaged to provide investor relations services to the Company.

In October, November and December 2008, the Company issued 45,000 shares to an investor relations firm that had been engaged to provide investor relations services to the Company. These shares, which were valued at $39,000, were issued as partial consideration for services rendered.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 11 – COMMON STOCK (continued)

c) Reserved

At December 31, 2008, the Company had reserved 413,604 shares of common stock for future issuance and distribution in relation to the May 22, 2008 merger with Auctomatic. These shares were to be issued to the Auctomatic founders in three equal instalments on the next three anniversary dates of the merger contingent on their continued employment with the Company pursuant to the terms of the merger agreement. In the first quarter of 2009, one of the Auctomatic founders resigned from the Company. As a result, 137,868 shares reserved for distribution to this individual were released and are no longer payable. Pursuant to the release, the balance of reserved shares of common stock for future issuance and distribution is 275,736. See also Note 7 and Note 11(d).

In June 2009, the Company issued 91,912 of these reserved shares to the remaining two Auctomatic founders pursuant to the Merger Agreement. These shares were to be issued on the first anniversary date of the merger. In August 2009, the remaining two Auctomatic founders were terminated and the shares of common stock contingent on their continued employment with the Company were forgone pursuant to separation agreements signed with the two individuals. Refer to Note 19.

Effective January 31, 2009, the Company’s former President and Chief Operating Officer resigned. Pursuant to his separation agreement, the Company is required to pay an accrued special bonus in the amount of CAD$250,000 less any statutory deductions. The net payment of this bonus will be converted to equity and paid as restricted shares of the Company’s common stock. As the number of shares of common stock is not fixed on any specific share price, it is not possible to quantify the number of shares that will have to be issued to pay the net amount of this bonus.

d) Stock Options

The Board of Directors and stockholders approved the 2007 Stock Incentive Plan and adopted it August 21, 2007 (the “Plan”). The Company has reserved 5,000,000 shares of its common stock for issuance to directors, employees and consultants under the Plan. The Plan is administered by the Board of Directors. Vesting terms of the options range from immediately to five years and no options will be exercisable for a period of more than ten years.

All stock options noted herein vest over three years and are exercisable for a period of five years based on the date of grant. The Company historically valued the options granted to employees and directors using the Black Scholes option pricing model at the date of grant. The Company values the options to consultants at each reporting period under FAS 123(R) for non-employees using the Black Scholes option pricing model. The assumptions used in the pricing model include:

	2009 (as Restated)	2008 (As Restated)
Dividend yield	0%	0%
Expected volatility	97.2%	64.86%-75.68%
Risk free interest rate	1.44%	1.62% - 3.07%
Expected lives	3.375 years	3.375 years

(i)

On January 1, 2008, the Company granted to its Chief Corporate Development Officer (“CCDO”) 1,000,000 options at an exercise price of $2.06 per share. These options have a fair value of $1.26 per option granted.

(ii)

On January 7, 2008, the Company granted to its Vice President, Finance (“VP Finance”) 150,000 options at an exercise price of $1.98 per share. These options have a fair value of $1.20 per option granted.

(iii)

On March 14, 2008, the Company granted to a director 100,000 options at an exercise price of $2.49 per share. These options have a fair value of $1.40 per option granted.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 11 – COMMON STOCK (continued)

d) Stock Options (continued)

(iv)

On May 27, 2008, the Company granted to its Vice President, General Counsel (“VP GC”) 125,000 options at an exercise price of $3.10 per share. These options have a fair value of $1.71 per option granted.

(v)

Between January 1, 2008 and December 31, 2008, the Company granted to its full-time corporate directors a total of 425,000 options at a range of exercise prices between $2.06 and $3.30 per share. These options have a fair value of between $1.26 and $1.92 per option granted. 25,000 of these options were forfeited during 2008, and an additional 100,000 options were forfeited in the first quarter of 2009. Subsequent to March 31, 2009, the remaining 300,000 options were forfeited.

(vi)

Between January 1, 2008 and December 31, 2008, the Company granted to its full-time employees a total of 290,000 options at a range of exercise prices between $0.65 and $3.10 per share. These options have a fair value of between $0.30 and $1.71 per option granted. 17,500 of these options have been forfeited during 2008, and an additional 92,500 options were forfeited in the first quarter of 2009. Subsequent to March 31, 2009, 25,000 options were forfeited.

(vii)

Between January 1, 2008 and December 31, 2008, the Company granted to consultants a total of 70,000 options at exercise prices ranging from $2.06 to $2.49 per share. All of these options were forfeited during 2008.

(viii)

On March 25, 2009, the Board of Directors approved a reduction of the exercise price of stock option grants made prior to this date. As a result, all grants issued prior to March 25, 2009 currently have an exercise price of $0.65. The stock option grants included in the repricing initially had exercise prices between $0.65 and $3.30. The incremental value of $213,895 relating to the fair values at the date of the reduction in price has been included in the period expense.

(ix)

On March 25, 2009, the Company granted to its full-time employees a total of 115,000 options at an exercise price of $0.30 per share. These options have a fair value of $0.19 per option granted. Subsequent to March 31, 2009, 100,000 options were forfeited.

The Company recognizes stock-based compensation expense over the requisite service period of the individual grants, which generally equals the vesting period. FAS 123(R) requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Due to recent economic developments, the Company has experienced a high level of forfeitures during late 2008 and early 2009. The Company assesses forfeiture rates for each class of grantees; executive management and directors, corporate directors, and general staff members. Executive management and directors are relatively few in number and turnover is considered remote, therefore the Company estimates forfeitures for this class of grantees to be 10%. Corporate directors are high level senior staff members with a forfeiture rate of 25% and general staff members have a higher forfeiture rate due to higher average turnover rates at 35%. Estimate of forfeitures is reviewed on an annual basis. Stock-based compensation is expensed on a straight-line basis over the requisite service period.

The fair value of these options at March 31, 2009 of $5,096,398 (2008 - $5,824,833) will be recognized on a straight-line basis over a vesting term of 3 years and accordingly an expense of $542,013 has been recognized in the quarter ended March 31, 2009 (year ended December 31, 2008 - $1,992,461) and included in management fees and employee salaries expense.

On May 22, 2008, the Company reserved 413,604 shares of common stock for future issuance and distribution in relation to the merger with Auctomatic. These shares were to be issued to the Auctomatic founders in three equal instalments on the next three anniversary dates of the merger contingent on their continued employment with the Company pursuant to the terms of the Merger Agreement. As these shares are contingent on future employment, they are considered contingent consideration and are required to be accounted for under FAS 123(R) as stock-based compensation. During the first quarter of 2009, 137,868 of these shares were forfeited. See also Note 7. All such shares have been valued at the date of grant using a 3 year term and 33% forfeiture rate. The Company assesses forfeiture rates for these shares consistent to its analysis of granted options. The Auctomatic founders are considered corporate directors, along with some other employees. The forfeiture rate of 33% among Auctomatic founders alone is consistent with a 25% forfeiture rate for the whole class of corporate directors.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 11 – COMMON STOCK (continued)

d) Stock Options (continued)

The $827,208 value of these shares will be recognized on a straight-line basis over a vesting term of 3 years at date of grant and accordingly, an expense has been recognized in the first quarter of 2009 of $68,330 (year ended December 31, 2008 - $170,065) and included in management fees and employee salaries expense.

A summary of the option activity under the 2007 Plan during 2008 and 2009 is presented below:

Options	Shares		Weighted Average Exercise Price $		Weighted Average Fair Value $
Options outstanding, December 31, 2007		2,750,000		1.41		1.50
Granted		2,160,000		0.81		1.36
Exercised		-		-		-
Cancelled or expired		112,500		2.29		0.47
Options outstanding, December 31, 2008		4,797,500		1.12		1.46
Granted		115,000		0.30		0.19
Exercised		-		-		-
Cancelled or expired		1,692,500		1.98		1.46
Options outstanding, March 31,2009		3,220,000		0.64		1.42

Options vested at March 31, 2009		1,093,333		0.65		1.45

Aggregate Intrinsic Value		$5,750
Weighted average remaining life	3.75 Years

e) Common Stock Purchase Warrants

On May 1, 2008, the Company issued 50,000 common stock share purchase warrants with an exercise price of $2.33 to its investor relations firm in connection with a services agreement. The warrants expire May 1, 2010. The Company valued these options using the Black Scholes option pricing model using the following assumptions: no dividend yield; expected volatility rate of 69.27%; risk free interest rate of 2.37% and an expected life of 2 years resulting in a fair value of $0.91 per warrant granted, and a total fair value of $45,500.

In connection with the private placement in November 2008, the Company issued 1,627,344 warrants for the purchase of one-half share of the Company’s common stock with an exercise price of $0.78 expiring November 19, 2010 and 1,627,344 warrants for the purchase of one-half share of the Company’s common stock with an exercise price of $0.91 expiring November 19, 2011. The Company valued the warrants expiring November 19, 2010 using the Black Scholes option pricing model using the following assumptions: no dividend yield; expected volatility rate of 75.24%; risk free interest rate of 1.09% and an expected life of 1 year. This resulted in a fair value of $0.09 per warrant. The Company valued the warrants expiring November 19, 2011 also using the Black Scholes option pricing model using the following assumptions: no dividend yield; expected volatility rate of 70.53%, risk free interest rate of 1.36% and an expected life of 2 years. This resulted in a fair value of $0.10 per warrant. The total fair value of both warrants at November 19, 2008 and December 31, 2008 was $157,895. The warrants issued are contingently redeemable in cash in certain circumstances which may not all be within the Company’s control. As a result, the accounting treatment for the warrants falls under EITF 00-19, and their fair value of $157,895 was recorded as a liability at November 19, 2008. Any future changes to the fair value of the warrants will be adjusted to the statement of operations in the period in which the change in fair value occurs. The total fair value of both warrants at March 31, 2009 was $242,704 (December 31, 2008 - $157,895) and therefore the $84,809 change in fair value has been charged to the consolidated statements of operations in the period.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 11 – COMMON STOCK (continued)

e) Common Stock Purchase Warrants (continued)

As of March 31, 2009, 4,304,688 warrants to purchase the Company’s common stock remain outstanding as follows:

			Weighted
Warrants	Outstanding		Average		Date of
			Exercise Price		Expiry
			$
Warrants outstanding, December 31, 2007		1,000,000		1.25	June 10, 2009
Granted May 1, 2008		50,000		2.33	May 1, 2010
Granted November 19, 2008		1,627,344		0.78	November 19, 2010
Granted November 19, 2008		1,627,344		0.91	November 19, 2011
Cancelled or expired		-		-
Warrants exercisable December 31, 2008 and March 31, 2009		4,304,688		0.96

Weighted average remaining life	1.67 Years

NOTE 12 – DOMAIN NAME LEASES AND SALES

2009

On February 27, 2009 (the “Effective Date”), the Company entered into an agreement to lease one domain name to an unrelated third party for $1,250,000. The terms of the agreement provided for the receipt of this amount in irregular lease payments over a one-year term. The first payment of $225,000 was due within 7 days of the Effective Date, $65,000 was due on each of the first to the fifth monthly anniversaries of the Effective Date, $100,000 was due on each of the sixth to the ninth monthly anniversaries of the Effective Date, and $300,000 was due on the first year anniversary of the Effective Date. The Company was to lease the domain name to the purchaser exclusively during the term of the agreement. Title and rights to the domain name would be transferred to the purchaser only when full payment is received at the end of the lease term. If the purchaser defaults on any payments, the agreement terminates, funds received to date are forfeited by the purchaser, and rights to the domain name return to the Company. Due to the uncertainty regarding the collectibility of the funds in the future, only the amounts received to date have been recorded as a gain on sale of a domain name at quarter end. When collectibility is reasonably assured, the full gain on sale will be reflected in the Company’s operations. During the quarter, a resulting gain of $290,000 was recorded. In May 2009, the purchaser breached the agreement, and the purchaser forfeited a total of $355,000 that had already been paid to the Company as of that date. Under the terms of the agreement, the Company retained the funds and the domain name. See Note 19.

On February 24, 2009, the Company entered into an agreement to sell one domain name to an unrelated third party for $400,000. The title of the domain name transferred to the buyer in March 2009 and the funds were received, therefore the disposal and resulting gain of $327,933 was recorded during the quarter.

2008

On December 31, 2008, the Company entered into an agreement to sell one domain name to an unrelated third party for CDN$500,000. The terms of the agreement provided for the receipt of CDN$476,190 on December 31, 2008 and the balance of CDN$23,810 by March 31, 2009. The title of the domain name transferred to the buyer at December 31, 2008 as collection of the balance was reasonably assured, therefore the disposal and resulting gain of USD$293,215 was recorded on December 31, 2008. Both payments were received in accordance with the terms of the agreement.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 12 – DOMAIN NAME LEASES AND SALES (continued)

2008 (continued)

On January 17, 2008, the Company entered into an agreement to lease one domain name to an unrelated third party for CDN$200,000. The terms of the agreement provide for the receipt of this amount in five irregular lease payments over a two-year term. The first payment of CDN$25,000 was due on January 17, 2008 (the “Effective Date”), CDN$45,000 was due 3 months after the Effective Date, CDN$80,000 was due 6 months after the Effective Date, CDN$25,000 is due 1 year after the Effective Date, and CDN$25,000 is due 2 years after the Effective Date. The Company will lease the domain name to the third party exclusively during the term of the agreement. Title and rights to the domain name will be transferred to the purchaser only when full payment is received at the end of the lease term. If the third party defaults on any payments, the agreement terminates, funds received to date are forfeited by the lessee, and rights to the domain name return to the Company. This transaction was recorded as a sales-type lease in 2008. The investment in a sales-type lease of $163,963 was recorded on the balance sheet on a net basis after the lease payments received to date. The gain of $168,206 was recorded at the present value of the lease payments over the term, net of the cost of the domain name, at an implicit rate of 6%. Payments have been collected to date in accordance with the terms of the agreement.

NOTE 13 – OTHER EXPENSES

During Q1 of 2009, the Company incurred various restructuring costs of $264,904 consisting of severance payments to the former President and Chief Operating Officer and to other staff terminated in the first quarter as a result of restructuring the Company’s staffing requirements.

During Q1 of 2008, the Company incurred various restructuring costs totaling $629,856 relating to establishing the new management team. During the period, such costs included severance payments to the Company’s former Chief Financial Officer of $168,429, $25,657 in consulting fees to the former Chief Financial Officer, $317,109 in signing bonuses to the Company’s new Chief Corporate Development Officer and new Vice President Finance, a severance payment of $53,582 to one full time employee, $39,778 in costs related to changing the Company name and rebranding, and $25,301 in some final windup costs related to the FrequentTraveller disposition in late 2007.

NOTE 14 – INCOME TAXES

The Company’s subsidiaries, DHI, Acadia, Importers, and 612793 are subject to federal and provincial taxes in Canada. The Company and its subsidiary, Delaware, are subject to United States federal and state taxes.

As at March 31, 2009, the Company and its US subsidiaries have net operating loss carryforwards from previous tax years of approximately $4,138,000 and capital loss carryforwards of $120,000 that result in deferred tax assets. The Company’s Canadian subsidiaries have non capital loss carryforwards of approximately $6,187,000 that result in deferred tax assets. These loss carryforwards will expire, if not utilized, through 2028. The Company’s subsidiary DHI also has approximately $896,300 in undepreciated capital costs relating to property and equipment that have not been amortized for tax purposes. The costs may be amortized in future years as necessary to reduce taxable income. Management believes that the realization of the benefits from these deferred tax assets is uncertain and accordingly, a full deferred tax asset valuation allowance has been provided and no deferred tax asset benefit has been recorded.

The Company has a deferred tax liability related to potential taxes owing on potential gains on disposal of its domain name intangible assets. GAAP does not permit taxable temporary differences associated with indefinite life intangible assets to be considered as evidence to otherwise reduce a valuation allowance associated with deductible timing differences in the same entity. The Company has recorded a related deferred tax liability in its consolidated balance sheets at March 31, 2009 and December 31, 2008.

There has been no substantial change in the effective tax rate since December 31, 2008.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 15 – SEGMENTED INFORMATION

In 2008 and 2009, the Company’s operations were conducted in two business segments; eCommerce Products, and Advertising and Other.

During 2008, the Company began offering international shipping on its Perfume.com website. The operations from Perfume.com are included as the eCommerce Products business segment. The sales generated from regions other than North America have been immaterial during the quarter ended March 31, 2009 as well as the year ended December 31, 2008, and therefore no geographic segment reporting is required.

Revenues, operating profits and net identifiable assets by business segments are as follows:

	eCommerce			Advertising			Total
	Products			and Other
For the quarter ended March 31, 2009 (as Restated)		$			$			$
Revenue		1,720,167			32,215			1,752,382
Segment Loss From Operations		(971,639	)		(773,592	)		(1,745,231	)

As at March 31, 2009 (as Restated)		$			$			$
Total Assets		4,270,912			2,023,457			6,294,369
Intangible Assets		158,849			1,398,418			1,557,267


	eCommerce			Advertising			Total
	Products			and Other
For the quarter ended March 31, 2008 (as Restated)		$			$			$
Revenue		1,820,643			27,836			1,848,479
Segment Loss From Operations		(1,695,960	)		(657,891	)		(2,353,851	)

As at March 31, 2008 (as Restated)		$			$			$
Total Assets		5,840,263			1,812,190			7,652,453
Intangible Assets		189,047			1,436,834			1,625,881

The reconciliation of the segment loss from operations to net loss as reported in the consolidated financial statements is as follows:

	For the quarter ended March 31, 2009			For the quarter ended March 31, 2008
	(As Restated)			(As Restated)
	(unaudited)			(unaudited)
Segment Loss	$	(1,745,231	)	$	(2,353,851	)
Non-Operating Income (Expenses)
Global Cricket Venture recovery		250,000			-
Gains from sales and sales-type lease of domain names		617,933			168,206
Accretion interest expense		(40,000	)		-
Interest and investment income		890			42,498
Non-controlling interest		-			51,506
Net loss for the period	$	(916,408	)	$	(2,091,641	)

Substantially all property and equipment and intangible assets are located in Canada.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 16 – COMMITMENTS

Premise Lease

Effective October 1, 2007 the Company leased its office in Vancouver, Canada from an unrelated party for a 5-year period from October 1, 2007 to September 30, 2012. Pursuant to the terms of the lease agreement, the Company is committed to basic rent payments expiring September 30, 2012 as follows.

	CDN $
2009	87,475
2010	121,531
2011	126,873
2012	98,159

The Company will also be responsible for common costs currently estimated to be equal to approximately 43% of basic rent.

Cricket Venture

The initial Memoranda with the BCCI and the IPL required the Company to pay both the BCCI and the IPL minimum payments over the next ten years, beginning on October 1, 2008. See Note 6. On March 31, 2009, the Company was released and discharged from all past and future minimum payments owing to the IPL.

The Company signed the Mutual Termination Agreement with the BCCI effective March 31, 2009. This agreement returns control of the BCCI website back to the BCCI in exchange for the termination of the BCCI Memorandum signed in April 2008. As a result, all rights, licenses, and benefits granted to Live Current under that Memorandum revert to BCCI. The agreement constitutes full and final settlement of any and all historic and future outstanding obligations due from Live Current under the BCCI Memorandum. Per the Mutual Termination Agreement, Live Current is released from all accrued liabilities under the BCCI Memorandum, conditional on a $750,000 payment to be made by July 1, 2009 by GCV under the Novation Agreement explained below.

The Company signed the Novation Agreement with the BCCI and the GCV effective March 31, 2009. This agreement releases and discharges Live Current from the IPL Memorandum in full, including the amounts originally accrued for payments owing on October 1, 2008 and January 1, 2009. In addition, the IPL Memorandum’s payment schedule has been amended as well. There are now no payments due on October 1, 2008, January 1, 2009 or April 1, 2009. The first payment owing under the IPL Memorandum by the GCV are $2,250,000 on July 1, 2009. In August 2009, an unrelated third party agreed to assume and be liable for all past and future obligations and liabilities of GCV arising from the original MOU, as it was amended by the Novation. See Note 19.

NOTE 17– CONTINGENCY

A former Chief Executive Officer of DHI commenced a legal action against DHI on March 9, 2000 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 in an approximate amount of $30,000, aggravated and punitive damages, interest and costs. On June 1, 2000, DHI filed a Defense and Counterclaim against this individual claiming damages and special damages for breach of fiduciary duty and breach of his employment contract. The outcome of these legal actions is currently not determinable and as such the amount of loss, if any, resulting from this litigation is presently not determinable. To date, there has been no further action taken by the plaintiff since the filing of the initial legal action on March 9, 2000.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 18– RELATED PARTY TRANSACTIONS

2009

On March 1, 2009, the Company began charging $6,000 per month to a company controlled by its Chief Executive Officer. Live Current is providing this company IT, administrative, and marketing support. This arrangement allows Live Current to share its resources while earning revenues for support services. The Company believes that the amount being paid represents the fair market value of the services being provided.

2008

The Company issued shares of common stock to related parties pursuant to private placements 2008 as follows:

On November 19, 2008, the Company closed a private placement financing in which C. Geoffrey Hampson, the Company’s Chief Executive Officer, invested $126,750. Mr. Hampson received 195,000 restricted shares of common stock, two-year warrants to purchase 97,500 common shares at an exercise price of $0.78, and three-year warrants to purchase 97,500 common shares at an exercise price of $0.91.

On November 19, 2008, the Company closed a private placement financing in which Jonathan Ehrlich, the Company’s then President and Chief Operating Officer, invested $25,000. Mr. Ehrlich received 38,461 restricted shares of common stock, two-year warrants to purchase 19,230 common shares at an exercise price of $0.78, and three-year warrants to purchase 19,230 common shares at an exercise price of $0.91.

On November 19, 2008, the Company closed a private placement financing in which Mark Melville, the Company’s Chief Corporate Development Officer, invested $35,000. Mr. Melville received 53,846 restricted shares of common stock, two-year warrants to purchase 26,923 common shares at an exercise price of $0.78, and three-year warrants to purchase 26,923 common shares at an exercise price of $0.91.

NOTE 19 – SUBSEQUENT EVENTS

Global Cricket Venture

On March 31, 2009, the Company, its recently formed subsidiary GCV, the BCCI and the IPL amended the MOUs. The Company and the BCCI jointly entered into a Termination Agreement, pursuant to which the BCCI Memorandum was terminated. The Company, Global Cricket Venture and the BCCI, on behalf of the IPL, entered into a Novation Agreement with respect to the IPL Memorandum. Under the Novation Agreement, the $1 million owing at December 31, 2008 was reduced to $500,000. The responsibility for this payment and the benefits associated with the MOU formerly held by the Company were transferred to GCV.

In August 2009, GCV transferred and assigned to an unrelated third party (“CricketCo”) all of its rights, title, and interest in and to the original MOU with the IPL, as the original MOU was amended by the Novation Agreement that was signed on March 31, 2009. Pursuant to this agreement, CricketCo also agreed to assume and be liable for all past and future obligations and liabilities of GCV arising from the original MOU, as it was amended by the Novation. The Company has also agreed to sell the domain name cricket.com to a company related to CricketCo whereby the Company will sell the cricket.com domain name, along with the website, content, copyrights, trademarks, etc., for consideration of four equal payments of $250,000. The cricket.com domain name shall remain the property of the Company until all payments have been made. The Company cannot determine the financial impact of this transaction at this time.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 19 – SUBSEQUENT EVENTS (continued)

Auctomatic

In August 2009, the Company reached an agreement with twelve of the eighteen Auctomatic shareholders to convert $424,934 of the $800,000 payable into a convertible interest bearing note with a one year term. The payment due date is May 22, 2010.

Also in August 2009, the Company reached an agreement with the remaining two founders of Auctomatic which terminates their employment. Under their severance agreements, the Company will repay the amounts owed under the Merger Agreement at a 10% discount to face value and will record an additional $60,000 of severance costs in Q3 of 2009 due to them under their employment agreements. In consideration of these payments, these individuals have each agreed to forfeit their rights to 91,912 shares of Live Current common stock that were due to be issued to each of them in May 2010 and May 2011 under the Merger Agreement.

The Company no longer has any intention of using the software as a platform for the development of any of its domain names. It has now adapted a different platform for Perfume.com, and will use platforms developed by the Company’s partners for Karate.com and likely any future partnerships. The Company believes that any resale value of the software without the individuals who built it is minimal. In Q1 of 2009, one founder of Auctomatic left the Company, and subsequent to Q2 of 2009, the other two founders of Auctomatic were terminated. The auction software that was acquired pursuant to the Merger Agreement was developed by these three founders. As all founders of Auctomatic are no longer employed, the Company no longer has any individuals who can understand or modify the technology. As a result, the Company believes that the auction software is impaired and will write off its net book value of $590,973 at the end of the second quarter of 2009.

Employment Severance Agreement

Pursuant to the terms and conditions of an employment severance agreement dated February 4, 2009 (the “COO Severance Agreement”) between the Company and its former President and Chief Operating Officer (“COO”), the COO resigned as the Company’s President and Chief Operating Officer and as an officer of the Company’s subsidiaries effective January 31, 2009. In June 2009, the Company and the COO renegotiated the payment terms of the amounts under the COO Severance Agreement. As of September 1, 2009, the remaining severance allowance and additional benefits to be paid shall be paid in equal semi-monthly instalments over a remaining period of ten months instead of five months, and therefore will continue through June 30, 2010. In addition, the COO deferred the net monthly equity payments that the Company was obligated to pay him during the 2009 calendar year to December 31, 2009.

Live Current Media Inc.

(formerly Communicate.com Inc.)

Notes to the Amended and Restated Consolidated Financial Statements

For the three months ended March 31, 2009

(Unaudited)

As restated – Note 2

NOTE 19 – SUBSEQUENT EVENTS (continued)

Stock Issuances

On April 9, 2009, the Company entered into an agreement whereby $8,625 of its accounts payable were extinguished in exchange for the issuance of 27,823 shares of its common stock, which were issued on April 14, 2009.

On June 17, 2009, the Company issued 45,956 shares of its common stock to each of the two Auctomatic founders remaining employed with the Company as required under the Merger Agreement, for a total of 91,912 shares.

Stock Option Plan

In April and May 2009, a total of 10,000 stock options were granted to two of the Company’s full-time employees. The options had exercise prices between $0.30 and $0.35.

On September 1, a total of 75,000 stock options were granted to two of its corporate directors at an exercise price of $0.22 per share.

Sales of Domain Names

On April 15, 2009, the Company sold one domain name to a third party purchaser for $400,000 less commission, and the purchase price was paid in full by April 29, 2009.

In July 2009, the Company sold three domain names for $725,000 less commission and the purchase prices were paid in full upon the execution of each agreement.

In August 2009, the Company sold the domain name www.cricket.com as disclosed above.

Also in August 2009, the Company sold a domain name for $1,100,000 less commission. This domain name had been previously sold to an unrelated party in February 2009, however in May 2009 the purchaser breached the agreement and forfeited a total of $355,000 that had already been paid to the Company as of that date. See Note 12.

NOTE 20 – COMPARATIVE FIGURES

Certain comparative figures have been reclassified to conform to the basis of presentation adopted in the current period.

Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

(a) Forward Looking Statements

The Company makes forward-looking statements in this Amendment No. 2 and may make such statements in future filings with the Securities and Exchange Commission. The Company may also make forward-looking statements in its press releases or other public shareholder communications. Its forward-looking statements are subject to risks and uncertainties and include information about its expectations and possible or assumed future results of operations. When management uses any of the words “believes”, “expects”, “anticipates”, “estimates” or similar expressions, it is making forward-looking statements.

While management believes that our forward-looking statements are reasonable, you should not place undue reliance on any such forward-looking statements, which speak only as of the date made. Because these forward-looking statements are based on estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond management’s control or are subject to change, actual results could be materially different. Factors that might cause such a difference include, without limitation, the following: the Company’s inability to generate sufficient cash flows to meet its current liabilities, its potential inability to retain qualified management, sales and customer service personnel, the potential for an extended decline in sales, the possible failure of revenues to offset additional costs associated with any changes in our business model, the potential lack of website acceptance, the Company’s potential inability to introduce new products to the market, the potential loss of customer or supplier relationships, the extent to which competition may negatively affect prices and sales volumes or necessitate increased sales or marketing expenses, and the other risks and uncertainties set forth in this Amendment No. 2.

Other factors not currently anticipated by management may also materially and adversely affect our results of operations. Except as required by applicable law, management does not undertake any obligation to publicly release any revisions which may be made to any forward-looking statements to reflect events or circumstances occurring after the date of this Amendment No. 2.

Readers of this report should not rely solely on the forward-looking statements and should consider all risks and uncertainties throughout this Amendment No. 2, as well as those discussed under “Item 1A Risk Factors” in our Amendment No. 1 to our Annual Report on Form 10-K for the year ended December 31, 2008.

The following discussion should be read in conjunction with our interim consolidated financial statements and their explanatory notes, which are included in Item 1.

(b) Business Overview

Live Current Media Inc. was incorporated under the laws of the State of Nevada on October 10, 1995 under the name “Troyden Corporation”. We changed our name on August 21, 2000 from Troyden Corporation to “Communicate.com Inc.”, and again on May 30, 2008 to Live Current Media Inc. Since August 4, 2008, our common stock has been quoted on the OTCBB under the symbol, “LIVC”.

Our corporate website is located at www.livecurrent.com. Information included on the website is not a part of this Amendment.

Subsidiaries

Our 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 Digital 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. DHI has 62,635,383 shares of common stock currently issued and outstanding. 61,478,225 shares, or approximately 98.2% of the outstanding shares, are held by Live Current.

On December 31, 2005, DHI reorganized by transferring certain domain name assets into its wholly owned subsidiary, Acadia Management Corp. (“Acadia”), a British Columbia corporation incorporated on December 1, 2005. In October 2008, the assets and liabilities of Acadia were assigned to DHI and Acadia was subsequently dissolved in January 2009. On December 31, 2006, DHI transferred the domain name Importers.com to its wholly owned subsidiary 0778229 B.C. Ltd. (“Importers”), a British Columbia company incorporated on December 27, 2006. DHI also has a dormant wholly owned subsidiary, 612793 B.C. Ltd. (“612793”), which was incorporated on August 21, 2000.

On March 13, 2008, the Company incorporated a wholly owned subsidiary in the state of Delaware, Communicate.com Delaware, Inc. (“Delaware”). The new subsidiary was incorporated to facilitate the merger with Auctomatic.

On August 8, 2008, the Company formed a wholly-owned subsidiary in Singapore, LCM Cricket Ventures Pte. Ltd. (“LCM Cricket Ventures”). This company holds 50.05% of Global Cricket Venture Pte. Ltd.

We presently employ twenty-three full-time and one part-time employee, as well as one consultant.

Our principal office is located at #645-375 Water Street, Vancouver, British Columbia V6B 5C6. We also lease an office at 12201 Tukwila Intl. Blvd, Suite 200, Tukwila, WA 98168 for a nominal amount per month.

Operations

DHI, our majority-owned subsidiary, owns more than 800 domain names. Through DHI, we build consumer internet experiences around our large portfolio of intuitive, easy to remember domain names. These domain names span several consumer and business-to-business categories including health and beauty (such as Perfume.com), sports and recreation (such as Cricket.com and Boxing.com), travel (such as Brazil.com and Indonesia.com), and global trade (Importers.com). We believe that we can develop and sustain businesses based on these intuitive domain names in part because of the significant amount of search and direct type-in traffic they receive. We have begun to exploit this traffic through the construction of consumer experiences online, which we call DestinationHubs®, at Perfume.com and, prior to its disposition, at Cricket.com. DestinationHubs® tap into a large, passionate, pre-existing community of interested users. From a technology and product standpoint, a DestinationHub® is architected for discovery, meaning it is built in such a way that it is found easily through search. One of the best ways to ensure sites are found through search is to have a powerful domain name asset as a low-cost customer acquisition vehicle that easily enables ownership of that subject category. Over time, we expect to build out additional DestinationHubs® at several of our domain names. We may also choose to sell select domain names to strategic buyers.

We also own a number of .cn (China) domain names. We believe that the .cn domain names could have significant value as the internet market in China develops. We also have a number of non-core “bound.com” domain names that we may choose to develop that cover expansive categories of interest such as shoppingbound.com, pharmacybound.com and vietnambound.com.

We have organized our operations into two principal segments: (1) ECommerce Products , which currently consists of our “Health and Beauty” websites, and (2) Advertising. Our Health and Beauty websites generate revenue by facilitating the sale of products direct to consumers (eCommerce). Currently, our eCommerce revenues are primarily derived from the sale of fragrance products to consumers at our Perfume.com website. Our sports and recreation, travel, and global trade websites generate revenues through the sale of online advertising space to advertisers, derived by offering “pay per click” and display advertising on various websites in our portfolio.

ECommerce Revenues

We currently generate almost all of our eCommerce revenues through product sales on Perfume.com. We plan to continue to build Perfume.com eCommerce revenues by expanding to more efficient distribution and fulfillment channels, creating a more engaging consumer experience, and performing continued technical improvements to the websites. We will also continue to explore other product-related revenue streams across our domain name portfolio.

Health and Beauty Products

Our Perfume.com website sells discounted brand name fragrances, including women’s perfume, men’s cologne, and designer hair care and skin care products direct to consumers in the US and select international markets. Perfume.com sells 100% authentic products and provides customers with a satisfaction guarantee. We are not dependent on any single supplier for the products that we sell. The products are supplied by various wholesale suppliers located in the United States.

Our products are described in detail on our website. The products are offered through an easily navigated website experience within a transaction secure environment accepting the usual modes of secure credit card payments, PayPal and Google Checkout. Products can also be ordered using our toll-free telephone number.

By way of its intuitive domain name and through ongoing technical optimizations, Perfume.com consistently ranks highly in organic, unpaid search results across major search engines. Organic search traffic delivers the majority of traffic and customers to Perfume.com. The site also realizes traffic through direct navigation by visitors. Finally, we acquire internet traffic through paid search, comparison shopping websites, and our robust email marketing efforts as well as through affiliate sales. We use affiliate relationships whereby we pay our affiliates sales commissions if they deliver traffic to Perfume.com that results in a successful sale. Affiliates do not represent themselves as Perfume.com, and through a rigorously enforced policy, are not allowed to use our name. Affiliates place our advertisements on their websites. We pay these affiliates a commission when visitors to their sites click on our advertisements and make purchases on Perfume.com.

Advertising Revenues

Over time, we expect to generate significant revenues by selling advertising either directly to advertisers or in partnership with third party advertising networks. During 2007 and early 2008, we had an arrangement with Overture Services, Inc. (“Overture”) pursuant to which we were paid a fee for referrals to sites with connections to Overture. We terminated our relationship with Overture effective February 29, 2008, to give us more flexibility to deploy advertising across our websites. Currently, many of our websites are part of Google AdSense's network of publishers which generates advertising revenues and monetizes our properties. Google AdSense matches ads to our sites’ content and audiences, and depending on the type of ad, we earn revenues from clicks or impressions. The relationship with Google is a non-exclusive agreement and as we develop our domain websites we may revisit direct relationships or other third party advertising networks.

Sports and Recreation

At March 31, 2009, we hosted one sports-related website, Cricket.com. Cricket.com is a community website for cricket fans. The site includes cricket-related news, schedules of games played worldwide, scores, photos and an active fantasy cricket league. Cricket.com generates revenue through paid advertisements on the website.

Travel

We currently host two travel websites; Brazil.com and Indonesia.com, as Vietnam.com was sold after March 31, 2009. These sites seek to provide much of the information a traveler to these destinations might need. Aside from information and access to flights and hotels, the sites provide basic facts about the countries (history, language, maps and facts), information on tourist attractions and major cities, weather, blogs from travelers and links to other sites about the destination. We earn advertising revenues and affiliate commission revenues for the referred sales of hotels, flights and travel bookings from these websites.

Global Trade

Importers.com is a trade website that connects businesses around the world by providing tools such as an email service and a searchable, online database which helps facilitate communication between buyers and sellers. Businesses register on the website for free. Once registered, buyers and distributors can access information about manufacturers and wholesalers and vice versa. The information is grouped in product categories or may be found via a search bar included on the website. As long as both parties are members, they may contact each other via e-mail. The website also provides useful information concerning international trade-related issues such as customs clearance, transportation providers and trade development organizations. We earn advertising revenues from this website.

Sale and Lease of Domain Names

We own more than 800 domain names. We believe that there is high value in building businesses around the domain names we own, however we recognize that there are opportunities whereby selling or leasing them may be more valuable than exploiting the ownership value of the names. We also recognize that selling some non-core domain names is an effective way to raise funds in a non-dilutive manner, and have successfully sold or leased two domain names in February 2009 with differing payment schedules, and another domain name subsequent to our quarter end. We continue to evaluate any offers received. In the future, we may buy domain names to complement our existing businesses in the health and beauty, sports, travel and global trade categories. In 2008, there was one outright sale and another sales-type lease of domain name assets.

Karate.com

On September 30, 2008, we signed a letter of intent with Domain Strategies, Inc., a leading internet development and management company, to jointly establish a new company (“Newco”) for the purpose of building, managing and monetizing the Karate.com domain name we own. The partnership with Domain Strategies will provide management focus and resources to efficiently monetize the domain name. We will contribute the domain name Karate.com to Newco and will receive a 50% interest of the new company, plus a distribution and liquidation preference of $500,000. The Board of Directors of Newco will have equal representation from both partners with Domain Strategies having primary responsibility for the management of day-to-day operations including site design, employment relationships, vendors, customer acquisition and maintenance and relationships with potential strategic partners. If after three years from the date of formation, Newco has not achieved the annual financial goals as set by management and approved by the Board, we have the right to terminate our participation in Newco and ownership of the domain name www.karate.com will revert back to us. In the event that we are the terminating party, Domain Strategies will have the right but not the obligation to purchase our interest in Newco, including the domain name www.karate.com for $1 million within 60 days of termination.

Global Cricket Venture

On April 17, 2008, we signed two Memoranda of Understanding (individually the “BCCI Memorandum” and the “IPL Memorandum” and, together, the “Memoranda”) with each of the Board of Control for Cricket in India (“BCCI”) and the DLF Indian Premier League (“IPL”). The Memoranda, each of which had a term of 10 years, granted to us the exclusive right to provide the official websites for the BCCI and the IPL (the “Cricket Websites”). As consideration for the rights conveyed, we agreed to pay a minimum annual fee to the BCCI of the greater of 50% of all revenues generated from the BCCI website or an average payment of $3 million per year and a minimum annual fee to the IPL of the greater of 50% of all revenues generated from the IPL website or an average payment of $2 million per year. In addition to the annual fee, we agreed to pay a total of 5% of the revenues generated by a third website, Cricket.com, to the BCCI and the IPL. Revenues were defined as all revenues generated by the Cricket Websites with the exception of revenues earned from the sale of tickets to the matches. We agreed that the minimum annual fee would be paid on a quarterly basis during the first 3 years of the term. The payments, when made, may have been subject to certain withholding or other taxes which we may have been required to gross up pursuant to the terms of the Memoranda. The first payment to the BCCI of $625,000 was due on October 1, 2008, with additional payments of $625,000 due on January 1, 2009, April 1, 2009 and July 1, 2009. The first payment to the IPL of $375,000 was due on October 1, 2008, with additional payments of $375,000 due on January 1, 2009, April 1, 2009 and July 1, 2009. The payment due to the BCCI was decreased to $125,000 pursuant to an agreement we reached with the BCCI. We did not make any of the payments called for by the Memoranda.

In conjunction with our execution of the Memoranda, we signed an agreement (the “Venture Agreement”) with Netlinkblue, the owner of the live streaming and mobile rights to the BCCI and IPL cricket matches. Under the Venture Agreement, we and Netlinkblue agreed to create a new company into which we would transfer our rights under the Memoranda and Netlinkblue would transfer the rights it acquired to live stream the matches. As contemplated by the Venture Agreement, a company was incorporated in Singapore on June 10, 2008 and named Global Cricket Venture Pte. Ltd. (“Global Cricket Venture” or “GCV”). Our wholly-owned subsidiary, LCM Cricket Ventures, currently owns 50.05% of the shares of Global Cricket Venture. Pursuant to the Venture Agreement, once we and Netlinkblue each transfer the rights we received from the BCCI and the IPL into Global Cricket Venture, certain rights and obligations will arise, including the obligation that each of us provides funding to Global Cricket Venture. As described below, on March 31, 2009, we and the BCCI jointly terminated the BCCI Memorandum and we assigned the IPL Memorandum to Global Cricket Venture. To our knowledge, Netlinkblue has not transferred the rights it received from the BCCI and the IPL to Global Cricket Venture, therefore, as of March 31, 2009, we do not believe that we have an obligation to provide funding to Global Cricket Venture. The Venture Agreement also required that we and Netlinkblue negotiate and enter into definitive agreements with further terms and conditions to govern our relationship. To date, no definitive agreements have been prepared.

On March 31, 2009, we and the BCCI entered into a Termination Agreement, pursuant to which the BCCI Memorandum was terminated. On that same date, we, Global Cricket Venture and the BCCI, on behalf of the IPL, entered into a Novation Agreement (the “Novation”) with respect to the IPL Memorandum. Pursuant to the Novation, Global Cricket Venture was granted all of our rights, and assumed all of our obligations, under the IPL Memorandum. Global Cricket Venture also assumed certain payments due to the BCCI under the BCCI Memorandum.

As a result of the Novation,

●

Global Cricket Venture, a 50.05% owned subsidiary, rather than Live Current, is the party to the IPL Memorandum;

●

the term of the IPL Memorandum was modified, so that it began on April 1, 2008 and will end on December 31, 2017;

●

the minimum payment due on October 1, 2008 to the BCCI of $125,000, reduced from $625,000, and any other payments owed to the BCCI through March 31, 2009 were assumed by Global Cricket Venture and are to be paid on July 1, 2009. We will be fully released from these liabilities once Global Cricket Venture makes these payments;

●

the minimum payment due on October 1, 2008 to the IPL of $375,000, and any other payments owed to the IPL through March 31, 2009 were assumed by Global Cricket Venture and are to be paid on July 1, 2009;

●

a right to terminate the IPL Memorandum due to a material breach or on the insolvency of either party was added; and

●

the “Minimum Annual Fee Payment Schedule” (Schedule 2 to the IPL Memorandum) was revised. The first payment of $2,250,000 is due on July 1, 2009.

The $375,000 owing to the IPL for the October 1, 2008 minimum payment under the IPL Memorandum that was accrued and expensed in 2008 was reversed on March 31, 2009. The $625,000 owing to the BCCI for the October 1, 2008 minimum payment under the BCCI Memorandum that was accrued and expensed in 2008 was renegotiated to $125,000. Therefore $500,000 was reversed on March 31, 2009. The $625,000 owing to the BCCI for the January 1, 2009 minimum payment under the BCCI Memorandum was accrued and expensed in the first quarter of 2009. The two minimum payments of $125,000 and $625,000 owing to the BCCI as at March 31, 2009 were assumed by Global Cricket Venture, however the release of the Company's obligation to make the payments is contingent on Global Cricket Venture making the payments on or before July 1, 2009.

During the first quarter of 2009, the Company incurred $227,255 of costs relating to initial performance of its obligations under the Memoranda with each of the BCCI and the IPL and establishing Global Cricket Venture with Netlinkblue. These costs relate to, but are not limited to, expenditures for business development, travel, consulting, and salaries and have been included in corporate marketing, management fees and salaries, and corporate general and administrative expenses.

Due to the reversal of the $375,000 and $500,000 accrued liabilities at December 31, 2008 and the recognition of $625,000 owing for the January 1, 2009 BCCI minimum payment, there was a net recovery of Global Cricket Venture expenses of $250,000 recorded during the quarter.

The Company determined that its original interim consolidated financial statements for the quarter ended March 31, 2009 (the “Original Financial Statements”), as well as the consolidated financial statements for the years ended December 31, 2008 and 2007, contained errors. These errors, which are described below, affected the financial position, results of operations and cash flows for the quarters ended March 31, 2009 and March 31, 2008, and the fiscal year ended December 31, 2008. Please also see Note 2 to our restated interim financial statements for the quarter ended March 31, 2009.

A. Deferred income tax liability related to indefinite life intangible assets:

B. Non-Controlling Interest:

C. Management Compensation:

D. Estimated life of stock options:

E. Other

(i) Expense accruals

(ii) Gain on sale of domain name

F. Classification of warrants issued in November 2008 private placement:

In November 2008, the Company raised $1,057,775 of cash by selling 1,627,344 units consisting of one share of the Company’s common stock and two warrants, each for the purchase of a half share of common stock. The offering price was $0.65 per unit. The estimated fair value of the warrants was $157,895 and was presented as equity in the Original Financial Statements. The warrants contained provisions which could require their redemption in cash in certain circumstances which may not all be within the Company’s control. The fair value of the warrants therefore should have been recorded as a liability, with future changes to fair value reported as either income or expense in the period in which the change in fair value occurs. There were no changes to the fair value of the warrants between the November 2008 issue date and December 31, 2008.

G. Shares issued in connection with the merger with Auctomatic:

(i) Valuation of shares issued as purchase consideration

(ii)	Shares issued to Auctomatic founders

H. Financial Statement Classification of Amounts Payable to the BCCI and IPL:

In order to provide clarity, the Company also classified separately on its consolidated balance sheets and consolidated statements of operations $750,000 in amounts payable as at March 31, 2009 and $1,000,000 as at December 31, 2008 to the BCCI and IPL.

I. Tax Impact:

None of the above disclosures gave rise to an increase or decrease in the Company’s tax position.

The following table illustrates the effect of the adjustments by financial statement line item in the Company’s consolidated balance sheets as of March 31, 2009:

March 31, 2009	Reference		As previously reported			Restatement adjustment			As restated
ASSETS
Current
Cash and cash equivalents			$	572,588		$	-		$	572,588
Accounts receivable (net of allowance for doubtful accounts of nil)				100,035			-			100,035
Prepaid expenses and deposits				92,145			-			92,145
Inventory				47,421			-			47,421
Current portion of receivable from sales-type lease				23,423			-			23,423
Total current assets				835,612			-			835,612

Property & equipment				947,389			-			947,389
Website development costs				348,061			-			348,061
Intangible assets				1,557,267			-			1,557,267
Goodwill		B, G(i)		2,428,602			177,438			2,606,040
Total Assets			$	6,116,931		$	177,438		$	6,294,369

LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities		H	$	2,922,350		$	(750,000	)	$	2,172,350
Amounts payable to the BCCI and IPL		H		-			750,000			750,000
Bonuses payable		C(ii)		81,660			46,304			127,964
Due to shareholders of Auctomatic				829,799			-			829,799
Deferred revenue				78,696			-			78,696
Current portion of deferred lease inducements				20,138			-			20,138
Total current liabilities				3,932,643			46,304			3,978,947

Deferred income tax		A		-			206,370			206,370
Warrants		F		-			242,704			242,704
Deferred lease inducements				50,345			-			50,345
Total Liabilities				3,982,988			495,378			4,478,366

STOCKHOLDERS' EQUITY
Common Stock
Authorized: 50,000,000 common shares, $0.001 par value
Issued and outstanding:
23,906,445 common shares (December 31, 2008 - 23,546,370)				15,216			-			15,216
Additional paid-in capital				15,285,508			208,882			15,494,390
Accumulated deficit				(13,166,781	)		(526,822	)		(13,693,603	)
Total Stockholders' Equity				2,133,943			(317,940	)		1,816,003
Total Liabilities and Stockholders' Equity			$	6,116,931		$	177,438		$	6,294,369

The following table illustrates the effect of the adjustments by financial statement line item in the Company’s consolidated statements of operations as of March 31, 2009:

For the quarter ended March 31, 2009	Reference		As previously reported			Restatement adjustment			As restated

SALES			$	1,752,382		$	-		$	1,752,382

COSTS OF SALES (excluding depreciation and amortization as shown below)				1,386,619			-			1,386,619

GROSS PROFIT				365,763			-			365,763

OPERATING EXPENSES
Amortization and depreciation				98,166			-			98,166
Amortization of website development costs				32,562			-			32,562
Corporate general and administrative		E(i), F		158,274			168,080			326,354
ECommerce general and administrative				80,220			-			80,220
Management fees and employee salaries		C(i), C(ii), D, G(ii)		960,846			232,749			1,193,595
Corporate marketing				3,771			-			3,771
ECommerce marketing				111,422			-			111,422
Other expenses		C(ii)		346,564			(81,660	)		264,904
Total Operating Expenses				1,791,825			319,169			2,110,994

NON-OPERATING INCOME (EXPENSES)
Global Cricket Venture expenses		H		250,000			(250,000	)		-
Global Cricket Venture recovery		H		-			250,000			250,000
Gain from sales and sales-type lease of domain names		E(ii)		580,525			37,408			617,933
Accretion interest expense				(40,000	)		-			(40,000	)
Interest and investment income				890			-			890
Total Non-Operating Income (Expenses)				791,415			37,408			828,823

NET LOSS AND COMPREHENSIVE LOSS FOR THE PERIOD			$	(634,647	)	$	(281,761	)	$	(916,408	)

BASIC AND DILUTED LOSS PER SHARE			$	(0.03	)	$	(0.01	)	$	(0.04	)

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING - BASIC AND DILUTED				22,509,120			-			22,509,120

The following table illustrates the effect of the adjustments by financial statement line item in the Company’s consolidated statements of equity as of March 31, 2009:

		As previously reported
		Common stock					Additional Paid-in Capital			Accumulated Deficit			Total			Restatement Adjustment			As Restated Total
	Reference	Number of Shares			Amount
Balance, December 31, 2007 (audited)		21,446,623			12,456		10,188,975			(2,525,678	)		7,675,753			(283,218	)		7,392,535
Stock-based compensation	D, G(ii)	-			-		2,111,354						2,111,354			51,172			2,162,526
Issuance of 586,403 common shares per the merger agreement with Auctomatic	G(i)	586,403			586		1,137,533						1,138,119			110,746			1,248,865
Issuance of 33,000 common shares to investor relations firm		33,000			33		85,649						85,682			-			85,682
Issuance of 120,000 common shares to investor relations firm		120,000			120		218,057						218,177			-			218,177
Issuance of 50,000 warrants to investor relations firm		-			-		45,500						45,500			-			45,500
Cancellation of 300,000 common shares not distributed		(300,000	)		-		-						-			-			-
Private Placement of 1,627,344 units at $0.65 per share	F	1,627,344			1,627		1,056,148						1,057,775			(157,895	)		899,880
Share issue costs		-			-		(86,803	)					(86,803	)		-			(86,803	)
Extinguishment of accounts payable		33,000			33		16,467						16,500			-			16,500
Net loss and comprehensive loss	A - E(ii), G(ii)									(10,006,456	)		(10,006,456	)		19,186			(9,987,270	)
Balance, December 31, 2008 (audited)		23,546,370		$	14,855	$	14,772,880		$	(12,532,134	)	$	2,255,601		$	(260,009	)	$	1,995,592
Stock-based compensation	D, G(ii)	-			-		386,513						386,513			223,830			610,343
Issuance of 15,000 common shares to investor relations firm		15,000			15		5,685						5,700			-			5,700
Extinguishment of accounts payable		345,075			346		120,430						120,776			-			120,776
Net loss and comprehensive loss	C(ii), D, E(i), E(ii), F, G(ii)									(634,647	)		(634,647	)		(281,761	)		(916,408	)
Balance, March 31, 2009 (unaudited)		23,906,445		$	15,216	$	15,285,508		$	(13,166,781	)	$	2,133,943		$	(317,940	)	$	1,816,003

The following table illustrates the effect of the adjustments by financial statement line item in the Company’s consolidated statements of cash flows as of March 31, 2009:

For the quarter ended March 31, 2009	Reference	As previously reported			Restatement adjustment			As restated
OPERATING ACTIVITIES
Net loss for the period		$	(634,647	)	$	(281,761	)	$	(916,408	)
Non-cash items included in net loss:
Gain from sales and sales-type lease of domain name	E(ii)		(580,525	)		(37,408	)		(617,933	)
Accretion interest expense			40,000			-			40,000
Stock-based compensation	D, G(ii)		386,513			223,830			610,343
Warrants issued	F		-			84,809			84,809
Issuance of common stock			5,700			-			5,700
Extinguishment of debt by issuance of common stock			120,776			-			120,776
Amortization and depreciation			125,693			-			125,693
Change in operating assets and liabilities:
Accounts receivable			(6,453	)		-			(6,453	)
Prepaid expenses and deposits			17,398			-			17,398
Inventory			26,661			-			26,661
Accounts payable and accrued liabilities	H		(1,444,566	)		333,271			(875,645	)
Amounts payable to the BCCI and IPL	H		-			(250,000	)		(250,000	)
Bonuses payable	C(i), C(ii)		81,660			(72,741	)		(226,731	)
Deferred revenue			(41,760	)		-			(41,760	)
Cash flows used in operating activities			(1,903,550	)		-			(1,903,550	)

INVESTING ACTIVITIES
Net proceeds from sale of domain name			358,130			-			358,130
Net proceeds from sales-type lease of domain name			313,423			-			313,423
Purchases of property & equipment			(2,704	)		-			(2,704	)
Website development costs			(25,231	)		-			(25,231	)
Cash flows from investing activities			643,618			-			643,618

Net increase (decrease) in cash and cash equivalents			(1,259,932	)		-			(1,259,932	)

Cash and cash equivalents, beginning of period			1,832,520			-			1,832,520
Cash and cash equivalents, end of period		$	572,588		$	-		$	572,588

The following is a summary of the significant effects of the restatements on the Company’s comparative consolidated statements of operations for the three months ended March 31, 2008:

For the quarter ended March 31, 2008	Reference		As previously reported			Restatement adjustment			As restated

SALES			$	1,848,479		$	-		$	1,848,479

COSTS OF SALES (excluding depreciation and amortization as shown below)				1,486,062			-			1,486,062

GROSS PROFIT				362,417			-			362,417

OPERATING EXPENSES
Amortization and depreciation				15,266			-			15,266
Corporate general and administrative		E(i)		486,087			63,750			549,837
ECommerce general and administrative				169,813			-			169,813
Management fees and employee salaries		C(i), C(ii), D, G(ii)		1,090,671			85,179			1,175,850
Corporate marketing				26,459			-			26,459
ECommerce marketing				149,187			-			149,187
Other expenses				629,856			-			629,856
Total Operating Expenses				2,567,339			148,929			2,716,268

NON-OPERATING INCOME (EXPENSES)
Gain from sales and sales-type lease of domain names				168,206			-			168,206
Interest and investment income				42,498			-			42,498
Non-controlling interest		B		-			51,506			51,506
Total Non-Operating Income (Expenses)				210,704			51,506			262,210

NET LOSS AND COMPREHENSIVE LOSS FOR THE PERIOD			$	(1,994,218	)	$	(97,423	)	$	(2,091,641	)

BASIC AND DILUTED LOSS PER SHARE			$	(0.10	)	$	(0.00	)	$	(0.10	)

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING - BASIC AND DILUTED				19,970,334			-			19,970,334

The following is a summary of the significant effects of the restatements on the Company’s comparative consolidated statements of cash flows for the three months ended March 31, 2008:

For the quarter ended March 31, 2008	Reference	As previously reported			Restatement adjustment			As restated
OPERATING ACTIVITIES
Net loss for the period		$	(1,994,218	)	$	(97,423	)	$	(2,091,641	)
Non-cash items included in net loss:
Non-controlling interest			-			(51,506	)		(51,506	)
Gain from sales and sales-type lease of domain names	E(ii)		(168,206	)		-			(168,206	)
Stock-based compensation	D, G(ii)		482,144			(38,423	)		443,721
Amortization and depreciation			10,231			-			10,231
Change in operating assets and liabilities:
Accounts receivable			(3,290	)		-			(3,290	)
Prepaid expenses and deposits			81,112			-			81,112
Accounts payable and accrued liabilities	E(i)		(92,347	)		63,750			(28,597	)
Bonuses payable	C(ii)		(241,290	)		123,602			(117,688	)
Deferred revenue			(33,435	)		-			(33,435	)
Cash flows used in operating activities			(1,959,299	)		-			(1,959,299	)

INVESTING ACTIVITIES
Net proceeds from sales-type lease of domain name			23,423			-			23,423
Accrued expenses relating to deferred acquisition costs			(111,265	)		-			(111,265	)
Deferred acquisition costs			(121,265	)		-			(121,265	)
Purchases of property & equipment			(154,069	)		-			(154,069	)
Website development costs			(147,025	)		-			(147,025	)
Cash flows used in investing activities			(510,201	)		-			(510,201	)

Net increase (decrease) in cash and cash equivalents			(2,469,500	)		-			(2,469,500	)

Cash and cash equivalents, beginning of period			7,375,245			-			7,375,245
Cash and cash equivalents, end of period		$	4,905,745		$	-		$	4,905,745

The following selected financial data was derived from our amended and restated unaudited interim consolidated financial statements for the quarters ended March 31, 2009 and March 31, 2008. The information set forth below should be read in conjunction with our financial statements and related notes included elsewhere in this report.

	Three Months Ended
	March 31, 2009			March 31, 2008
	(Unaudited)			(Unaudited)
	(As restated)			(As restated)
SALES
Health and beauty eCommerce	$	1,720,167		$	1,820,188
Other eCommerce		-			455
Domain name advertising		24,453			27,836
Miscellaneous income		7,762			-
Total Sales		1,752,382			1,848,479

COSTS OF SALES
Health and Beauty eCommerce		1,386,619			1,485,510
Other eCommerce		-			552
Total Costs of Sales (excluding depreciation and amortization as shown below)		1,386,619			1,486,062

GROSS PROFIT		365,763			362,417

OPERATING EXPENSES
Amortization and depreciation		98,166			15,266
Amortization of website development costs		32,562			-
Corporate general and administrative		326,354			549,837
ECommerce general and administrative		80,220			169,813
Management fees and employee salaries		1,193,595			1,175,850
Corporate marketing		3,771			26,459
ECommerce marketing		111,422			149,187
Other expenses		264,904			629,856
Total Operating Expenses		2,110,994			2,716,268

NON-OPERATING INCOME (EXPENSES)
Global Cricket Venture recovery		250,000			-
Gain from sales and sales-type lease of domain names		617,933			168,206
Accretion interest expense		(40,000	)		-
Interest and investment income		890			42,498
Non-controlling interest		-			51,506
Total Non-Operating Income (Expenses)		828,823			262,210

NET LOSS AND COMPREHENSIVE LOSS FOR THE PERIOD	$	(916,408	)	$	(2,091,641	)

BASIC AND DILUTED LOSS PER SHARE	$	(0.04	)	$	(0.10	)

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING - BASIC AND DILUTED		22,509,120			19,970,334

BALANCE SHEET DATA

	March 31, 2009			December 31, 2008
	(unaudited) (as restated)			(audited) (as restated)
Assets
Current Assets		835,612			2,133,150
Long-term portion of investment in sales-type lease		-			23,423
Property & equipment		947,389			1,042,851
Website development costs		348,061			355,391
Intangible assets		1,557,267			1,587,463
Goodwill		2,606,040			2,606,040
Total Assets	$	6,294,369		$	7,748,318

Liabilities
Current Liabilities		3,978,947			5,333,081
Deferred income tax		206,370			206,370
Warrants		242,704			157,895
Deferred lease inducements		50,345			55,380
Total Liabilities		4,478,366			5,752,726

Stockholders' Equity
Common Stock		15,216			14,855
Additional paid-in capital		15,494,390			14,757,932
Accumulated deficit		(13,693,603	)		(12,777,195	)
Total Stockholders' Equity		1,816,003			1,995,592
Total Liabilities and Stockholders' Equity	$	6,294,369		$	7,748,318

(d) Results of Operations

Sales and Costs of Sales

Overall, combined sales in Q1 of 2009 totaled $1,752,382 compared to $1,848,479 in Q1 of 2008, a decrease of 5.2%. Most of this decrease was driven by a decrease in sales on Perfume.com as noted below. Overall, Health and Beauty eCommerce product sales, consisting of Perfume.com sales, represented 98.2% of total revenues in Q1 of 2009, compared to approximately 98.5% of total revenues in Q1 of 2008.

Costs of sales were $1,386,619 in Q1 of 2009 compared to $1,486,062 during Q1 of 2008, a decrease of 6.7%. The decrease of costs of sales in Q1 of 2009 over Q1 of 2008 is in line with the decrease in Perfume.com sales for the quarter.

Overall gross margin in Q1 of 2009 was $365,763 or 20.9% compared to a gross margin of $362,417 or 19.6% in Q1 of 2008. This increase in the overall gross margin from Q1 of 2008 is due to efficient product merchandising efforts and a decrease in exposing coupons and discounts.

Health and Beauty eCommerce Sales

Our Health and Beauty eCommerce sales result from the sale of fragrances, designer skin care and hair care products to customers at Perfume.com. Our results from the first quarter of 2008 include eCommerce monetization of Body.com which ended in early 2008. Perfume.com accounted for nearly all of our eCommerce sales in 2008 and 2009 and we expect that this will continue in the short term.

The most recent quarters have presented great challenges for all retailers including eCommerce, due to the worldwide economic downturn. The industry has seen a decrease in consumer spending on discretionary items. Such a decrease will likely adversely affect the revenues from Perfume.com over the short-term.

Perfume.com revenues decreased 5.5% to $1,720,167 in Q1 of 2009 from $1,820,188 in Q1 of 2008. Daily sales averaged $19,113 per day in Q1 of 2009 compared to $20,002 per day in Q1 of 2008. In Q4 of 2008, we began reflecting revenues for orders that were in transit at quarter end as deferred revenues, where these amounts were not material and therefore not recorded as such in prior years. At the end of March, 2009, this represented approximately $63,000 in deferred revenues. Without this effect in Q1 of 2009, the decrease in Perfume.com revenues year over year was only 2.0%. Revenue growth was challenged as a result of continued softening of consumer discretionary spending in the US market. Additionally, in Q1 2009 we did not publish as many promotions with large product discounts that have historically driven top line revenue and eroded margin. We also eliminated inefficient marketing programs that drove revenue in 2008 but were not profitable.

Costs of shipping and purchases totaled $1,386,619 in Q1 of 2009 compared to $1,485,510 in Q1 of 2008. This produced a gross margin of $333,548 or 19.4% in Q1 of 2009 compared to $334,678 or 18.4% in Q1 of 2008. Gross profit margin in Q1 2009 increased compared to Q1 of 2008 primarily due to nominal decreases in our product discounting during the quarter, as well as a decrease in shipping costs attributed to a slight decrease in oil prices. Management anticipates that, subject to any further downturn in general economic conditions, it will maintain this profit margin through 2008 and into 2009. Over the next several quarters, management intends to explore opportunities to introduce and implement more robust supply chain capability which, if realized, should increase gross margins by the end of 2010.

Other eCommerce Sales

In Q1 of 2008, we ceased offering goods or services for sale on any of our websites other than Perfume.com and undertook to re-evaluate the business models around which these websites were built. As a result, these websites generated no revenue after the first quarter of the 2008 fiscal year. For the first half of 2009 we will continue to allocate our resources to the development of Perfume.com.

Advertising

In Q1 of 2009, we generated advertising revenues of $24,453 compared to $27,836 in Q1 of 2008, a decrease of 12.2%. Management has been able to establish new advertising relationships that have increased quarterly advertising revenues. In Q1 of 2009, advertising accounted for 1.4% of total revenues, compared to 1.5% of total revenues in Q1 of 2008. Advertising revenues are expected to continue to account for a small percentage of total revenues in the next few quarters as management continues to investigate new monetization opportunities with vendors, and realigns to increase advertising options available on our properties.

Domain Name Leases and Sales

In 2008, we entered into one agreement for a sales-type lease of one of our domain names for CDN$200,000 and one agreement for an outright sale of another domain name for CDN$500,000. The net gain on the disposal of these two domain names was USD$461,421 as disclosed in the 2008 consolidated financial statements .

We have announced our intention to sell six of our non-core but highly valuable dot.com domain names from our portfolio in order to provide additional working capital in a non-dilutive manner. We engaged the services of brokers to assist us with sales of our domain names. As a result of these relationships, we successfully sold or leased two domain names in February 2009, resulting in a net gain of $617,933 during the first quarter of 2009, as well as one additional domain name by May 15, 2009. We continue to evaluate any interest we receive from domain name buyers, and continue to consider acquiring certain other domain names that would complement either our advertising or eCommerce businesses.

General and Administrative (G&A) Expenses

General and administrative expenses consist of costs for general and corporate functions, including facility fees, travel, telecommunications, investor relations, insurance, merchant charges, and professional fees.

In Q1 of 2009, we incurred total general and administrative expense of $406,574 or 23.2% of total sales as compared to $719,650 or 38.9% of total sales in Q1 of 2008, a decrease of $313,076 or 43.5%. This total includes corporate and eCommerce related general and administrative costs. Management expected general and administrative expenses to decrease as a percentage of revenue as the eCommerce business grows, and has been able to successfully achieve this decrease in the first quarter of 2009.

Corporate general and administrative costs of $326,354 have decreased over Q1 of 2008 by $223,483. This was primarily due to a decrease in corporate legal of approximately $151,000 compared to the same period last year due to the addition of in-house legal counsel in May 2008. Other significant expenses included a decrease of approximately $111,000 of corporate travel and entertainment expenses and $25,000 in decreased rent and overhead due to cost-cutting procedures implemented in late 2008 and early 2009. The fair value adjustment for warrants of $84,809 increased the expenses in this category. The remainder of the difference is due to the declining value in the Canadian dollar against the US dollar between the first quarter of 2009 and the first quarter of 2008. Cricket related expenses included in corporate general and administrative costs in Q1 of 2009 were $40,064 and in Q1 of 2008 were $38,192. In total, corporate general and administrative expenses accounted for 18.6% of total revenues in Q1 of 2009, compared to 29.8% in Q1 of 2009.

We anticipate that we may incur additional legal expenses to comply with new disclosure and reporting requirements mandated by the British Columbia Securities Commission for companies listed on the OTCBB with a presence in British Columbia. These regulations were effective as of September 15, 2008.

ECommerce general and administrative costs in Q1 of 2009 decreased by $89,593 over Q1 of 2008 primarily due to the fact that Q1 of 2008 included approximately $105,000 in expenses relating to our search for executive employees and additions to our Perfume.com business. Some eCommerce general and administrative costs that increased in Q1 of 2009 over Q1 of 2008 included $10,000 in Perfume.com related travel. These expenses represented 4.7% of eCommerce sales in Q1 of 2009, compared to 9.3% of eCommerce sales in Q1 of 2008. Management believes these expense ratios are reasonable given the increasingly competitive environment for eCommerce sales in the United States and Management’s continued focus on growing the eCommerce business throughout 2008 and into 2009. Management expects to maintain eCommerce general and administrative costs below 10% of eCommerce sales.

Management Fees and Employee Salaries

In Q1 of 2009, we incurred total management fees and staff salaries of $1,193,595 compared to $1,175,850 in Q1 of 2008. This amount includes stock based compensation of $610,343 in Q1 of 2009 and $443,721 in Q1 of 2008, as well as accrued bonuses of $8,919 in Q1 of 2009 and $123,602 in Q1 of 2008. Excluding these amounts, management fees and employee salaries expense in Q1 of 2009 was $574,333 and in Q1 of 2008 was $608,527. This produced a decrease of 32.9% in Q1 of 2009 over Q1 of 2008. This decrease was primarily due to the layoffs which occurred in early 2009.

Management fees and staff salaries, excluding stock-based compensation and accrued bonuses, represented 32.8% of total revenues in Q1 of 2009 compared to 32.9% in Q1 of 2008. Cricket related expenses included in management fees and salaries in Q1 of 2009 were $185,874 and in Q1 of 2008 were $17,125. In August 2009, we terminated our activities related to the cricket venture. Also, since the end of the 2008 fiscal year, our staffing requirements were restructured and a number of employees were terminated, including our former President and COO. After severance payments have been fully paid out, the reduced number of staff will contribute to a decrease in management fees and salaries as a percentage of revenue. Given the caliber of current management, employees and consultants, we anticipate maintaining salary expense at approximately 20% of revenues.

Marketing

We generate internet traffic through paid search, email and affiliate marketing. We pay marketing costs related to these methods in order to drive traffic to our various websites. We pay our affiliates sales commissions if they deliver traffic to Perfume.com that result in a successful sale. In Q1 of 2009, total marketing expenses were $115,193 or 6.6% of total revenues, compared to $175,646 or 9.5% of total revenues in Q1 of 2008. This resulted in a 34.4% decrease for the period compared to the same period last year.

Expenses related to corporate activity, which we classify as corporate marketing expenditures totalled $3,771 in Q1 of 2009, compared to $26,459 in Q1 of 2008. These expenses consisted of $1,317 related to our cricket activities, and the remainder was due to costs related to public relations, which were higher in 2008 due to the repositioning of our business in early 2008.

ECommerce marketing expenses relate entirely to advertising costs incurred in our eCommerce business, particularly email advertising, search engine marketing, and affiliate marketing programs. ECommerce marketing expenses in Q1 of 2009 were $111,422 or 6.5% of eCommerce sales, compared to $149,187 or 8.2% of eCommerce sales in Q1 of 2008. These expenses decreased steadily during 2008 due to management’s decision to move key marketing efforts in-house, thereby eliminating agency expenses, as well as to take steps to increase the effectiveness of our search engine and email marketing campaigns for Perfume.com. We believe that customer acquisition is the key to accelerated growth, and deploying direct, measurable marketing vehicles like search, email, and affiliate marketing account for the largest part of these marketing expenditures.

Organic search rankings for Perfume.com currently perform adequately. However, we believe when these results are complemented with targeted, paid keyword advertising at opportune times, it brings additional traffic to Perfume.com. We believe that the more strategic and measurable advertising expenditures implemented during the last fiscal year were a contributing factor to increased revenues in 2008.

Marketing costs coincide with revenue growth and are expected to be in the range of 10% of gross product revenue. We have been able to maintain marketing costs below 10% of revenues while aggressively marketing our products and services.

Other Expenses

During Q1 of 2009, we incurred restructuring costs of $264,904, consisting of severance payments to the former President and Chief Operating Officer and to other staff terminated in the first quarter as a result of restructuring our staffing requirements.

During Q1 of 2008, we incurred various restructuring costs of $629,856 relating to establishing the new management team. These included approximately $168,400 in severance payments and $25,700 in consulting fees for assistance with the transition of the new management team, both of which were paid to our former Chief Financial Officer, $317,100 in signing bonuses which were paid to our new Chief Corporate Development Officer and our new Vice President Finance, additional severance of $53,600 paid to one of our full time employees, $39,800 in costs related to changing our name and rebranding, and $25,300 in some final windup costs related to the disposition of Frequent Traveler in late 2007.

Non-Controlling Interest

As a result of the restatement of our interim consolidated financial statements, the effect of the non-controlling (“NCI”) interest carried forward from prior years resulted in a net effect to the NCI liability at the December 31, 2007 year end of $8,786. There was a $51,506 credit relating to the non-controlling interest on the consolidated statements of operations for the quarter ended March 31, 2008. This credit was related to the benefit received by the minority shareholders due to the conversion of debt owed to the parent company by the operating subsidiary, DHI, into shares of DHI common stock that occurred in the first quarter of 2008. The continued losses of DHI have resulted in a debit balance of $24,007 in the NCI balance at March 31, 2009.

Global Cricket Venture Expenses

The Company has incurred costs of approximately $227,000 in the first quarter of 2009 relating to initial performance of its obligations under the MOUs with each of the BCCI and the IPL, and establishing Global Cricket Venture with NLB. The costs have been reported as $40,064 of corporate general and administrative expenses, $185,874 of management fees and employee salaries, and $1,317 in corporate marketing expenses. An additional $750,000 owing in aggregate to the BCCI and IPL for the October 1, 2008 and January 1, 2009 minimum payments under the initial MOUs have also been accrued as at March 31, 2009.

In August 2009, GCV transferred and assigned to an unrelated third party (“CricketCo”) all of its rights, title, and interest in and to the original MOU with the IPL, as the original MOU was amended by the Novation Agreement that was signed on March 31, 2009. Pursuant to this agreement, CricketCo also agreed to assume and be liable for all past and future obligations and liabilities of GCV arising from the original MOU, as it was amended by the Novation. We have also agreed to sell the cricket.com domain name, along with the website, content, copyrights, trademarks, etc., to a company related to CricketCo for consideration of 4 equal payments of $250,000. The cricket.com domain name shall remain our property until all payments have been made. These two agreements will result in our full exit out of the Cricket business, pending any obligation we may have to pay to the BCCI and IPL if CricketCo fails to make the assumed payments, and with the exception of interim support services which we have agreed to provide for a period of six months. The Company cannot determine the financial impact of this transaction at this time.

Auctomatic

In August 2009, we reached an agreement with twelve of the eighteen Auctomatic shareholders to convert $424,934 of the $800,000 payable into a convertible interest bearing note with a one year term. The payment due date is May 22, 2010.

Also in August 2009, we reached an agreement with the remaining two founders of Auctomatic which terminates their employment. Under their severance agreements, we will repay the amounts owed under the Merger Agreement at a 10% discount to face value and will record in Q3 of 2009 an additional $60,000 of severance costs due to them under their employment agreements. In consideration of these payments, these individuals have each agreed to forfeit their rights to 91,912 shares of Live Current common stock that were due to be issued to each of them in May 2010 and May 2011 under the Merger Agreement.

We no longer have any intention of using the software as a platform for the development of any of its domain names. It has now adapted a different platform for Perfume.com, and will use platforms developed by the Company’s partners for Karate.com and likely any future partnerships. The Company believes that any resale value of the software without the individuals who built it is minimal. As a result, the Company believes that the auction software is impaired and will write off its net book value of $590,973 at the end of the second quarter of 2009.

(e) Liquidity and Capital Resources

We generate cash inflows from (i) the sale of third-party products over the Internet; (2) "pay-per-click" advertising; (3) selling advertising on media rich websites with relevant content; and (4) the sale or lease of domain name assets. However, during the 2008 fiscal year and the first quarter of 2009, our cash inflows were not adequate to support our operations. In order to conserve cash, we paid certain service providers with shares of our common stock during, and subsequent to, the quarter ended March 31, 2009.

As at March 31, 2009, current liabilities were in excess of current assets resulting in a working capital deficiency of $3,143,335, compared to a working capital deficiency of $3,199,931 at the fiscal year ended December 31, 2008. During the three months ended March 31, 2009, we incurred a net loss after other items of $916,408, compared to a net loss after other items of $2,091,641 during the three months ended March 31, 2008. This quarter’s net loss includes gains from sales and sales-type lease of domain names of $617,933 compared to $168,206 during the same period last year, as well as a recovery on the payments for the Global Cricket Venture of $250,000 this quarter. We had a decrease in cash of $1,259,932 during the first quarter of 2009 compared to a decrease in cash of $2,469,500 during the first quarter of 2008. From the beginning of the fiscal year to March 31, 2009, we increased our accumulated deficit to $13,693,603 from $12,777,195 and have stockholders’ equity of $1,816,003.

The decrease in cash for the three month period primarily included cash outlays to pay off some large accounts payable that had been accrued at the December 31, 2008 fiscal year end, especially from our vendors relating to sales volume from December 2008. Other payments that were either unusual or non-operational in nature included $161,000 that was paid during the quarter related to Global Cricket Venture expenses incurred to perform under the agreements with BCCI, IPL and NLB.

Operating Activities

Operating activities in the three months ended March 31, 2009 resulted in cash outflows of $1,903,550 after adjustments for non-cash items, the most significant of which were the stock-based compensation expense during the period of $610,343 and the gain from the sales and sales-type lease of domain names of $617,933. Operating activities also included a significant decrease in accounts payable of $875,645 and in amounts payable to the BCCI and IPL of $250,000. In the three months ended March 31, 2008, cash outflows of $1,959,299 were primarily due to the loss of the period.

Investing Activities

Investing activities during the three months ended March 31, 2009 generated cash inflows of $643,618, primarily due to proceeds received from the sale and sales-type lease of domain names. During the three months ended March 31, 2008, cash from investing activities used $510,201 primarily consisting of accrued expenses relating to deferred acquisition costs of $111,265 as well as paid deferred acquisition costs of $121,265, both pursuant to the Auctomatic merger. Investing activities in the period also included purchases of $154,069 for property and equipment and $147,025 spent in website development costs.

Financing Activities

There were no financing activities in either the three months ended March 31, 2009 or the three months ended March 31, 2008.

Future Operations

At quarter end, we had a working capital deficiency, and for over the past two fiscal years we have experienced substantial losses. We expect to continue to incur losses in the coming quarters even though costs have been reduced through lay-offs and restructuring. We may also seek to explore new business opportunities, including the partnering, building or acquiring of a distribution center or warehouse in the United States to enhance our fragrance fulfillment capability and improve gross margins. These acquisitions may require additional cash beyond what is currently available and such funds may be raised by future equity and/or debt financings, and through the sale of non-core domain name assets.

We are pursuing opportunities to increase cash flows, however there is no certainty that these opportunities will generate sufficient cash flows to support our activities in the future in view of changing market conditions. During the 2009 fiscal year, we expect to expend significant funds toward additional marketing costs, which we believe will translate into higher revenue growth. There is no certainty that the profit margins we may generate going forward, as well as any successful raising of working capital, will be sufficient to offset the anticipated marketing costs and other expenditures and may result in net cash outflow for the 2009 fiscal year.

We have actively curtailed some operations and growth activities in an effort to reduce costs and preserve cash on hand. We are also continuing to seek opportunities to sell selected domain names in order to address short term liquidity needs. As a result, we have entered into agreements with brokers to sell several of our non-core but highly valuable dot-com domain names from our portfolio of more than 800 domain names. Two domain names were sold or leased during the first quarter of 2009 for $1.65 million. Through to May 15, 2009, we sold an additional domain name for proceeds of $400,000. We anticipate that further strategic sales of these domain names, if successful, will provide us with the required cash to meet our working capital needs, to fund cricket related expenditures, and to provide for general operating capital needs over the next 12 to 18 months. There can be no assurances that any future sales of domain names on terms acceptable to us will occur.

The interim consolidated financial statements have been prepared on a going concern basis which assumes that we will be able to realize assets and discharge liabilities in the normal course of business for the foreseeable future. Our ability to continue as a going-concern is in substantial doubt as it is dependent on continued financial support from our investors, our ability to sell additional non-core domain names, our ability to raise future debt or equity financings, and the attainment of profitable operations to meet our liabilities as they become payable. The outcome of our operations and fundraising efforts is dependent in part on factors and sources beyond our direct control that cannot be predicted with certainty. Access to future debt or equity financing is not assured and we may not be able to enter into arrangements with financing sources on acceptable terms, if at all. The financial statements do not include any adjustments relating to the recoverability or classification of assets or the amounts or classification of liabilities that might be necessary should we be unable to continue as a going concern.

The first payment due from Global Cricket Venture to the BCCI and the IPL was to be paid on July 1, 2009. The amount of the payment is $2,250,000. If Global Cricket Venture, a 50.05% owned subsidiary, is unable to make the required payments to the BCCI or the IPL, and no extension or renegotiation of the payment terms can be arranged, it may be exposed to a loss of rights and opportunities, or potential liability for defaulting on its payment. Such claims could include breach of contract, lack of performance and other claims for damages. If these events were to occur, they could have a negative effect on our overall anticipated results of operations and performance. In August 2009, the Company transferred and assigned all its interests in the project, including its ownership of the cricket.com domain name, for cash and assumption by the third party of all past and future liabilities due to the BCCI and IPL, as discussed above.

We have no current plans to purchase any significant property and equipment.

Off-Balance Sheet Arrangements

As of March 31, 2009, we did not have any off-balance sheet arrangements, including any outstanding derivative financial instruments, off-balance sheet guarantees, interest rate swap transactions or foreign currency contracts. We do have off-Balance Sheet commitments as disclosed in the notes to the interim consolidated financial statements, included at page F-1 to this Report. We do not engage in trading activities involving non-exchange traded contracts.

(f) Application of Critical Accounting Policies

Our interim consolidated financial statements and accompanying notes are prepared in accordance with United States generally accepted accounting principles. Preparing financial statements requires Management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by Management's application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions is critical to an understanding of our operating results and financial position.

Going Concern

Our interim consolidated financial statements have been prepared on a going concern basis which assumes that we will be able to realize assets and discharge liabilities in the normal course of business for the foreseeable future. We have generated a consolidated net loss for the quarter ended March 31, 2009 of $916,408 ($9,987,270 for the year ended December 31, 2008) and realized a negative cash flow from operating activities of $1,903,550 for the quarter ended March 31, 2009 ($4,854,260 for the year ended December 31, 2008). There is an accumulated deficit of $13,693,603 (December 31, 2008 - $12,777,195) and a working capital deficiency of $3,143,335 at March 31, 2009 ($3,199,931 at December 31, 2008).

Our ability to continue as a going-concern is in substantial doubt as it is dependent on continued financial support from our investors, our ability to raise equity financing and the attainment of profitable operations and further share issuances to meet our liabilities as they become payable, including our commitments for Global Cricket Venture, if any. The outcome of these matters is dependant on factors outside of our control and cannot be predicted at this time.

The accompanying consolidated financial statements have been prepared on a going concern basis which assumes that we will be able to realize assets and discharge liabilities in the normal course of business for the foreseeable future. These financial statements do not include any adjustments relating to the recoverability or classification of assets or the amounts or classification of liabilities that might be necessary should we be unable to continue as a going concern.

Principles of consolidation

The consolidated financial statements include our accounts, our wholly owned subsidiary Delaware, our wholly-owned subsidiary LCM Cricket Ventures, our 98.2% (December 31, 2007 - 94.9%) interest in our subsidiary DHI, DHI’s wholly owned subsidiaries Importers and 612793, and LCM Cricket Ventures’ 50.05% interest in Global Cricket Venture. All significant intercompany balances and transactions are eliminated on consolidation.

Business Combinations

On the acquisition of a subsidiary, the purchase method of accounting is used whereby the purchase consideration is allocated to the identifiable assets and liabilities on the basis of fair value at the date of acquisition. We consider critical estimates involved in determining any amount of goodwill, and test for impairment of such goodwill as disclosed in our Goodwill accounting policy below.

Revenue Recognition

Revenues, and associated costs of goods sold, from the on-line sales of products, currently consisting primarily of fragrances and other beauty products, are recorded upon delivery of products and determination that collection is reasonably assured. We record inventory as an asset for items in transit as title does not pass until received by the customer. All associated shipping and handling costs are recorded as cost of goods sold upon delivery of products.

Web advertising revenue consists primarily of commissions earned from the referral of visitors from our websites to other parties. The amount and collectibility of these referral commissions is subject to uncertainty; accordingly, revenues are recognized when the amount can be determined and collectibility can be reasonably assured. In accordance with Emerging Issues Task Force (“EITF”) 99-19, Reporting Revenue Gross as a Principal versus Net as an Agent , we record web advertising revenues on a gross basis.

Gains from the sale of domain names, whose carrying values are recorded as intangible assets, consist primarily of funds earned for the transfer of rights to domain names that are currently in our control. Revenues have been recognized when the sale agreement is signed and the collectibility of the proceeds is reasonably assured. In the first quarter of 2009, there was a sale of one domain name. Collectibility of the amounts owing on this sale is reasonably assured and therefore accounted for as a sale in the period the transaction occurred. In 2008, there was one sale of a domain name. Collectibility of the amounts owing on this sale is reasonably assured and therefore accounted for as a sale in the period the transaction occurred.

Gains from the sales-type leases of domain names, whose carrying values are recorded as intangible assets, consist primarily of funds earned over a period of time for the transfer of rights to domain names that are currently in our control. When collectibility of the proceeds on these transactions is reasonably assured, the gain on sale is accounted for as a sales-type lease in the period the transaction occurs.

Stock-Based Compensation

During the third quarter of 2007, we implemented the following new critical accounting policy related to stock-based compensation. Beginning July 1, 2007, we began accounting for stock options under the provisions of Financial Accounting Standards No. 123 (revised 2004), Share-Based Payment (“FAS 123(R)”), which requires the recognition of the fair value of stock-based compensation. Under the fair value recognition provisions for FAS 123(R), stock-based compensation cost is estimated at the grant date based on the fair value of the awards expected to vest and is recognized as expense ratably over the requisite service period of the award. We have used the Black-Scholes valuation model to estimate fair value of our stock-based awards which require various judgmental assumptions including estimating price volatility and expected life. Our computation of expected volatility is based on a combination of historic and market-based implied volatility. In addition, we consider many factors when estimating expected life, including types of awards and historical experience. If any of these assumptions used in the Black-Scholes valuation model change significantly, stock-based compensation expense may differ materially in the future from what is recorded in the current period.

In August 2007, our board of directors approved a Stock Incentive Plan to make available 5,000,000 shares of common stock to be awarded as restricted stock awards or stock options, in the form of incentive stock options (“ISO”) or non-qualified stock options to be granted to our employees, and other stock options to be granted to our employees, officers, directors, consultants, independent contractors and advisors, provided such consultants, independent contractors and advisors render bona-fide services not in connection with the offer and sale of securities in a capital-raising transaction or promotion of our securities. Our shareholders approved the Stock Incentive Plan at the 2008 Annual General Meeting.

We account for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FAS No. 123(R) and the conclusions reached by the EITF in Issue No. 96-18. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by EITF 96-18.

On March 25, 2009, our Board of Directors approved a reduction in the exercise price of stock option grants previously made under the 2007 Incentive Stock Option Plan. No other terms of the plan or the grants were modified.

Inventory

Inventory is recorded at the lower of cost or market using the first-in first-out (FIFO) method. We maintain little or no inventory of perfume which is shipped from the supplier directly to the customer. The inventory on hand as at March 31, 2009 is recorded at cost of $47,421 (December 31, 2008 - $74,082) and represents inventory in transit from the supplier to the customer.

Website Development Costs

We adopted the provisions of EITF No. 00-2, Accounting for Web Site Development Costs , whereby costs incurred in the preliminary project phase are expensed as incurred; costs incurred in the application development phase are capitalized; and costs incurred in the post-implementation operating phase are expensed as incurred. Website development costs are stated at cost less accumulated amortization and are amortized using the straight-line method over its estimated useful life. Upgrades and enhancements are capitalized if they result in added functionality which enables the software to perform tasks it was previously incapable of performing.

Intangible Assets

We adopted the provision of FAS No. 142, Goodwill and Intangible Assets , which revises the accounting for purchased goodwill and intangible assets. Under FAS 142, goodwill and intangible assets with indefinite lives are no longer amortized and are tested for impairment annually. The determination of any impairment would include a comparison of estimated future operating cash flows anticipated during the remaining life with the net carrying value of the asset as well as a comparison of our fair value to book value.

Our intangible assets, which consist of its portfolio of generic domain names, have been determined to have an indefinite life and as a result are not amortized. Management has determined that there is no impairment of the carrying value of intangible assets at March 31, 2009.

Goodwill

Goodwill represents the excess of acquisition cost over the fair value of the net assets of acquired entities. In accordance with FAS No. 142, Accounting for Goodwill and Other Intangible Assets, we are required to assess the carrying value of goodwill annually or whenever circumstances indicate that a decline in value may have occurred, utilizing a fair value approach at the reporting unit level. A reporting unit is the operating segment, or a business unit one level below that operating segment, for which discrete financial information is prepared and regularly reviewed by segment management.

The goodwill impairment test is a two-step impairment test. In the first step, we compare the fair value of each reporting unit to its carrying value. We determine the fair value of our reporting units using a discounted cash flow approach. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that reporting unit, goodwill is not impaired and we are not required to perform further testing. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then we must perform the second step in order to determine the implied fair value of the reporting unit’s goodwill and compare it to the carrying value of the reporting unit’s goodwill. The activities in the second step include valuing the tangible and intangible assets and liabilities of the impaired reporting unit based on their fair value and determining the fair value of the impaired reporting unit’s goodwill based upon the residual of the summed identified tangible and intangible assets and liabilities.

We assessed the carrying value of goodwill at the December 31, 2008 fiscal year end, and there are no indications that a decline in value may have occurred to March 31, 2009. At that date, the fair value of the Perfume.com reporting unit exceeded the carrying value of the assigned net assets, therefore no further testing was required and an impairment charge was not required.

Non-Controlling Interest

Our consolidated financial statements include the accounts of DHI (and its subsidiaries). All intercompany accounts and transactions have been eliminated upon consolidation. We record non-controlling interest which reflects the 1.8% portion of the earnings of DHI and its subsidiaries allocable to the holders of the minority interest.

(g) Recent Accounting Pronouncements

FAS 162

In May, 2008, the FASB issued FAS 162, The Hierarchy of Generally Accepted Accounting Principles. The new standard is intended to improve financial reporting by identifying a consistent framework, or hierarchy, for selecting accounting principles to be used in preparing financial statements that are presented in conformity with U.S. generally accepted accounting principles (GAAP) for nongovernmental entities. This Statement is effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board amendments to AU Section 411, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles . We do not expect that this Statement will result in a change in current practice.

Recently Adopted Accounting Pronouncements

FAS 161

In March 2008, the FASB issued FAS 161, Disclosures about Derivative Instruments and Hedging Activities , an amendment of FAS 133 . FAS 161 is intended to improve financial standards for derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity's financial position, financial performance and cash flows. Entities are required to provide enhanced disclosures about: how and why an entity uses derivative instruments; how derivative instruments and related hedged items are accounted for under FAS 133 and its related interpretations; and how derivative instruments and related hedged items affect an entity's financial position, financial performance and cash flows. FAS 161 was effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, which for us was the fiscal year beginning January 1, 2009. We adopted FAS 161 at January 1, 2009, however the adoption of this statement did not have a material effect on our financial results.

FSP FAS 142-3

In April 2008, the FASB issued FASB Staff Position ("FSP") FAS 142-3, Determination of the Useful Life of Intangible Assets . FSP FAS 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under FAS 142, Goodwill and Other Intangible Assets . The intent of FSP FAS 142-3 is to improve the consistency between the useful life of a recognized intangible asset under FAS 142 and the period of expected cash flows used to measure the fair value of the asset under FAS 141(R) and other applicable accounting literature. FSP FAS 142-3 was effective for financial statements issued for fiscal years beginning after December 15, 2008, which for us was the fiscal year beginning January 1, 2009. We adopted FAS 142-3 at January 1, 2009, however the adoption of this statement did not have a material effect on our financial results.

FAS 141(R)

In December 2007, the FASB issued FAS 141 (revised 2007), Business Combinations ("FAS 141(R)"). FAS 141(R) significantly changes the accounting for business combinations in a number of areas including the treatment of contingent consideration, preacquisition contingencies, transaction costs, in-process research and development and restructuring costs. In addition, under FAS 141(R), changes in an acquired entity's deferred tax assets and uncertain tax positions after the measurement period will impact income tax expense. This standard will change accounting treatment for business combinations on a prospective basis. FAS 141(R) was effective for financial statements issued for fiscal years and interim periods beginning after December 15, 2008, which for us was the fiscal year beginning January 1, 2009. We adopted FAS 141(R) at January 1, 2009, however the adoption of this statement did not have a material effect on our financial results.

FAS 160

In December 2007, the FASB issued FAS 160 Noncontrolling Interests in Consolidated Financial Statements , and simultaneously revised FAS 141 Business Combinations . This Statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008, which for us was the fiscal year beginning January 1, 2009. An entity may not adopt the policy before the transitional date. We adopted FAS 160 at January 1, 2009, however the adoption of this statement did not have a material effect on our financial results.

FAS 157

In 2008, we adopted FAS 157 for financial assets and liabilities recognized at fair value on a recurring basis. The adoption did not have a material effect on our financial results. The disclosures required by FAS 157 for financial assets and liabilities measured at fair value on a recurring basis as at December 31, 2008 are included in Note 3.

We applied the requirements of FAS 157 for fair value measurements of financial and nonfinancial assets and liabilities not valued on a recurring basis at January 1, 2009. We adopted these requirements of FAS 157 at January 1, 2009, however the adoption of this statement did not have a material effect on our financial results.

PART II

Item 6: Exhibits.

(A) Index to and Description of Exhibits.

EXHIBIT	DESCRIPTION
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
31.2	Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer
32.1	Section 906 Certificate of Chief Executive Officer and Principal Financial Officer

SIGNATURES

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

	LIVE CURRENT MEDIA INC.


Dated: October 26, 2009	By:	/s/ C. Geoffrey Hampson
	Name: Title :	C. Geoffrey Hampson CEO and Chairman of the Board (Principal Executive Officer)


Dated: October 26, 2009	By:	/s/ C. Geoffrey Hampson
	Name: Title :	C. Geoffrey Hampson CEO and Chairman of the Board (Principal Financial Officer)