Vancouver's Live Current Media is in the news again today with the announcement that it has signed a letter of intent with Domain Strategies, Inc. to jointly establish a new company for the purpose of building, managing and monetizing the Karate.com domain name.
The partnership will see Live Current contributing the domain name Karate.com to the new company in exchange for a 50% interest, plus a distribution and liquidation preference of $500,000. Domain Strategies will earn 50% of new company by investing $250,000 in cash to be used for website construction and operations, business development, marketing, public relations and strategic expertise services in the operation of the business. Domain Strategies will be entitled to a second distribution and liquidation preference of $500,000 that will only be paid out after Live Current Media has received the first $500,000.
If after three years from the date of formation, the new company has not achieved the annual financial goals as set by management and approved by the Board, Live Current has the right to terminate its participation in the ew company and ownership of the domain name Karate.com will revert back to Live Current. In the event Live Current is the terminating party, Domain Strategies will have the right but not the obligation to purchase Live Current's interest in the new company, including the domain name for $1 million within 60 days of termination.
Live Current's strategy is to prioritize building businesses around their top two domain names - Perfume.com and Cricket.com - and to look for alternative methods of monetizing the other domain names in their portfolio. Partnering with a proven developer of web properties for high-value domain names like Karate.com is one option and will likely be the model for future partnerships. However, that doesn't rule out selling select names from their portfolio as well.
Disclosure: Geoff Hampson and Boris Wertz are both Directors of Techvibes Media Inc. and Live Current Media Inc.