Engage BDR 20FR12B/A Initial registration of securities (foreign private issuers) (amended)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No.2 to FORM 20-F

(Mark One)

[X]

REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934

[ ]

REGISTRATION STATEMENT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2020

[ ]

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

For the transition period from to

[ ]

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

Date of event requiring this shell company report _______________

Commission file number: 001-39001

Engage BDR Ltd

(Exact Name of Registrant as Specified in Its Charter)

N/A

(Translation of Registrant’s Name Into English)

Australia

(Jurisdiction of Incorporation or Organization)

Scottish House Level 4

90 William Street

Melbourne Victoria 300

Australia

(Address of Principal Executive Offices)

Mr. Ted Dhanik Executive Chairman

8581 Santa Monica Blvd. #12

West Hollywood, California

90069

ted@engage-bdr.com

(310) 954-0751

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Ordinary Shares, no par value		To be registered		The Nasdaq Stock Market LLC (to be applied for)

Securities registered or to be registered pursuant to Section 12(g) of the Act:

None

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None

(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the registration statement:

As of December 31, 2020, there were 2,370,744,548 ordinary shares issued and outstanding, AU$0.0060 per ordinary share.

As of December 31, 2019, there were 712,394,973 ordinary shares issued and outstanding, AU$0.022 per ordinary share.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

[ ] Yes [X] No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

[ ] Yes [X] No

Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).

[X] Yes [ ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]

Accelerated filer [ ]

Non-accelerated filer [X]

Emerging growth company [X]

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. [ ]

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

[ ]

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP [ ]

International Financial Reporting Standards as issued by the International Accounting Standards Board [X]

Other [ ]

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

[ ] Item 17 [ ] Item 18

If this is an registration statement, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

[ ] Yes [X] No

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

[ ] Yes [ ] No

TABLE OF CONTENTS

INTRODUCTION	ii

FORWARD-LOOKING STATEMENTS	iii

PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS	1
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE	4
ITEM 3. KEY INFORMATION	4
ITEM 4. INFORMATION ON THE COMPANY	12
ITEM 4A. UNRESOLVED STAFF COMMENTS	16
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS	16
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES	19
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS	27
ITEM 8. FINANCIAL INFORMATION	29
ITEM 9. THE OFFER AND LISTING	29
ITEM 10. ADDITIONAL INFORMATION	30
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	34
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES	34

PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES	35
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS	35
ITEM 15. CONTROLS AND PROCEDURES	35
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT	35
ITEM 16B. CODE OF ETHICS	35
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES	35
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES	36
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS	36
ITEM 16G. CORPORATE GOVERNANCE	36
ITEM 16H. MINE SAFETY DISCLOSURE	36

PART III

ITEM 17. FINANCIAL STATEMENTS	F-1
ITEM 18. FINANCIAL STATEMENTS	F-1
ITEM 19. EXHIBITS	37

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS	F-1

INTRODUCTION

Unless otherwise indicated or the context otherwise requires, references in this registration statement on Form 20-F to:

●

“Engage BDR,” the “Company,” “we,” “us” and “our” refer to Engage BDR and its subsidiaries.

●

“$ refers to the legal currency of Australia and “US$” or “U.S. Dollars” refers to the legal currency of the United States.

●

We have made rounding adjustments to some of the figures included in this registration statement. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that preceded them.

●

Our functional currency is the Australian dollar. All monetary amounts are presented in Australian dollars unless otherwise specified. As of December 31, 2020 and December 31, 2019, the currency exchange rate from Austrialian dollars to U.S. dollars was: $1.00 = US$0.77 and $1.00=U.S.$0.70, respectively.

FORWARD-LOOKING STATEMENTS

This registration statement on Form 20-F contains forward-looking statements that reflect our current expectations and views of future events. Known and unknown risks, uncertainties and other factors, including those listed under “Item 3. Key Information—D. Risk Factors”, may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements.

You can identify some of these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “potential,” “continue” or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs. Factors that could cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements, include, but are not limited to, the factors summarized below:

●

We face risks related to health epidemics, severe weather conditions and other outbreaks, in particular, the current escalating coronavirus pandemic.

●

We operate in a highly competitive market and the size and resources of many of our competitors may allow them to compete more effectively than we can, preventing us from achieving profitability;

●

If we are not able to adequately protect our proprietary intellectual property and information, and protect against third party claims that we are infringing on their intellectual property rights, our results of operations could be adversely affected; and

You should read this registration statement and the documents that we refer to in this registration statement and have filed as exhibits to this registration statement completely and with the understanding that our actual future results may be materially different from what we expect. Other sections of this registration statement discuss factors which could adversely impact our business and financial performance. Moreover, we operate in an evolving environment. New risk factors emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We qualify all of our forward-looking statements by these cautionary statements.

You should not rely upon forward-looking statements as predictions of future events. The forward-looking statements made in this registration statement relate only to events or information as of the date on which the statements are made in this registration statement. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

iii

PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Information on directors
Name:		Mr Ted Dhanik, age 44
Title:		Co-Founder, Executive Chairman and Chief Executive Officer (appointed 14 December 2017)
Experience and expertise:		Ted Dhanik is one of the co-founders of engage:BDR LLC. He serves as Chief Executive
		Officer overseeing corporate development, strategic marketing, sales and business development, and product strategy.

		From 2003 to 2008, Ted worked with MySpace.com developing strategic marketing initiatives. He worked very closely with founders Chris DeWolfe and Tom Anderson and was responsible for launching the brand in its early days through a combination of on and offline campaigns. Ted also worked in business development at LowerMyBills.com until its acquisition by Experian. Ted was also an integral part of the development and launch of the consumer lending program at NexTag Corporation.

		He has worked for, or been a partner at, several other companies in business development, sales, and managerial positions, including Xoriant Corporation, Atesto Technologies, Brigade Solutions, Beyond.com/Cybersource Corporation and Merrill Corporation.

		Ted also advises a number of technology startups including Fighter, LottoGopher and Schizo Pictures and is an active mentor at Los Angeles-based startup accelerator Start Engine. He is passionate about being a thought leader in the industry and he is regularly published in leading publications.

		He regularly contributes to discussions about industry standards and achieving positive change, sitting on IAB committees including the Anti-fraud Workgroup, Anti-malware Workgroup, Traffic of Good intent Task Force, Programmatic Counsel, Digital Video Committee, Mobile Advertising Committee and Performance Marketing Committee.

Other current directorships:		Nil
Former directorships (last 3 years):		Nil
Interests in shares:		97,681,498 fully paid ordinary shares
Interests in options:		Nil
Interests in rights:		10,000,000

Name:		Mr Kurtis Rintala, age 50
Title:		Co-Founder, Executive Director and Chief Operating Officer
Experience and expertise:		Kurtis Rintala was one of the co-founders of engage:BDR LLC. and serves as the Chief
		Operating Officer for the Group overseeing day-to-day operations and leading the execution of the strategic direction of the Group.

		Kurtis is responsible for establishing policies that promote the Group culture and vision. He sets comprehensive goals for performance and growth and encourages optimum performance and dedication. He evaluates performance by analysing and interpreting data and metrics.

		Kurtis began his career in the technology industry in 2003 as an early member of the successful internet startup, LowerMyBills.com.

Other current directorships:		Nil
Former directorships (last 3 years):		Nil
Interests in shares:		47,717,391 fully paid ordinary shares
Interests in options:		Nil
Interests in rights:		4,000,000

Name:		Mr Tom Anderson, age 50
Title:		Non-Executive Director
Experience and expertise:		Tom Anderson was appointed to the Board of the Group as a Non Executive Director to provide the Group with the benefit of his wide ranging expertise in social media and innovative product design and to assist to steer the Group’s future growth strategy.

		Prior to joining the engage:BDR, Tom founded and served as President of MySpace, simultaneously inventing “social media” while revolutionizing the music industry. After its launch in 2003, MySpace became the #1 most visited site on the web quickly, surpassing companies such as Google, Yahoo and Amazon. At its peak, Nielsen Net Ratings reported that MySpace captured more than 10% of all minutes spent online.

		By the time Anderson left the company in 2009, he had amassed more than 350 million friends on MySpace, making him the first and still ultimately the biggest “influencer” of all time. His MySpace profile photo, which he never changed and still uses to this day is estimated to have been viewed more times than any single photograph in history.

		Before retiring in 2009, TIME Magazine included Tom among its list of the 100 most influential people in the world, and Barbara Walters named him one of her 10 Most Fascinating People.

		Since retiring, Tom has become an internationally recognised photographer, traveling to more than 40 countries in pursuit of his passion. Tom’s photos have appeared in countless magazines, newspapers, and websites. He now also has a keen interest in architecture and has designed a number of homes. He splits his time between his homes in Las Vegas, Hawaii and Los Angeles.

		Prior to his entrepreneurial and creative pursuits, Tom graduated with the Departmental Citation in English and Rhetoric at the University of California at Berkeley and later completed a Masters in Film & Critical Studies at UCLA.

Other current directorships:		Nil
Former directorships (last 3 years):		Nil
Interests in shares:		1,500,000 fully paid ordinary shares
Interests in options:		5,700,000
Interests in rights:		Nil

Name:		Mr Darian Pizem, age 38
Title:		Non-Executive Director
Experience and expertise:		Darian Pizem is the Co-Founder and current CEO of Blockbuster Ventures based in Sydney.
		Blockbuster is a blockchain development company that assists companies in the development of blockchain technology, real-time deployment, commercialisation, and other cost-saving measures.

		In addition, Mr. Pizem is the founder of Australian based company, Lunnna Ventures. Lunnna Ventures assists in the launching of start-up businesses in a variety of industries, ranging from healthcare to finance. Lunnna assists Company’s through all stages of the businesses development, cycle from the initial idea phase through to branding, partnerships and funding.

		Prior to founding his two businesses, Mr. Pizem worked as a Channel Partner for Australia’s DX Solutions, an ICT solutions and delivery service provider. DX specialties in automation, performance equipment, security and penetration testing, DevOps and Cloud solutions, BI and Analysis and Network E2E and B2B capabilities.

		Mr. Pizem has over 15 years of experience in the tech industry, working to promote company growth, innovation, and driving new ideas and concepts. He has a strong background in software ventures, with a focus on marketing, operations and management.

Other current directorships:		Nil
Former directorships (last 3 years):		Nil
Interests in shares:		Nil
Interest in options:		5,700,000
Interest in rights:		Nil

Name:		Mr Robert Antulov, age 57
Title:		Non-Executive Director
Experience and expertise:		Robert (Rob) Antulov is a Partner at boutique Australian corporate advisory firm Jacanda
		Capital, where he provides advice to clients in the technology and media sectors on trade sales, acquisitions and equity growth capital raisings.

		Based in Sydney, Rob is a highly accomplished Director with experience in public, private and not for profit enterprises, primarily in the tech and media sectors. He has extensive digital media expertise with strong capabilities in the implementation of technology-oriented growth strategies, most recently in digital media, programmatic advertising and online marketplaces. Rob also brings to engage:BDR specific M&A skills, having participated in over forty corporate transactions as either principal or advisor.

		Previous corporate experience has included senior executive roles with Fairfax, Coca-Cola and Booz & Co (now PwC Strategy&). His entrepreneurial activity includes co-founding a sports digital media business, co-founding a number of ecommerce and SaaS businesses and providing mentoring and Advisory Board guidance to numerous entrepreneurs and their ventures.

		Rob has a Bachelor of Engineering Degree (Elect) from the University of Western Australia, an MBA from the Australian Graduate School of Management at UNSW and has completed additional postgraduate studies in the USA at the Kellogg School of Management, North Western University.

Other current directorships:		Nil
Former directorships (last 3 years):		Director, Snakk Limited (NXT: SNK) - January 2016 to October 2018
Interests in shares:		665,500 fully paid ordinary shares
Interests in options:		5,700,000
Interests in rights:		Nil

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.

ITEM 3. KEY INFORMATION

A. Selected Financial Data

The following table presents the selected consolidated financial information for our business. You should read the following information in conjunction with Item 5 “Operating and Financial Review and Prospects” below. The following data for the years ended

December 31, 2018, 2019 and 2020 and as of December 31, 2018, 2019 and 2020 have been derived from our audited consolidated financial statements for those years, which were prepared in accordance with IFRS, and should be read in conjunction with those statements, which are included in this registration statement beginning on page F-1.

Selected Consolidated Balance Sheet Data:

	December 31,		December 31,			December 31,
	2020		2019			2018
Total current assets	$	9,174,755	$	11,757,644		$	4,971,591
Total assets		14,898,824		16,928,674			9,296,515
Total current liabilities		6,144,812		12,991,432			15,799,602
Total liabilities		6,232,157		13,021,004			15,905,362
Total shareholders’ equity		8,666,667		3,907,670	)		(6,608,847	)
Total liabilities and shareholders’ equity	$	14,898,824	$	16,928,674		$	9,296,515

Selected Consolidated Statements of Operations Data:

	For the Years Ended December 31,
	2020			2019			2018
REVENUES		15,398,413			17,079,118			11,443,935
COST OF REVENUES		(9,420,757	)		(7,794,937	)		(5,632,553	)
GROSS PROFIT		5,977,656			9,284,181			5,811,382
OPERATING EXPENSES:
Selling (Advertising and Marketing expense)		(138,984	)		(109,301	)		(269,667	)
General and administrative (Employee and contractor costs)		(7,976,461	)		(7,659,589	)		(11,388,219	)
Research and development
Total operating expenses		(8,115,445	)		(7,768,890	)		(11,657,886	)
INCOME FROM OPERATIONS		(2,137,789	)		1,515,291			(5,846,504	)
OTHER INCOME (EXPENSE)
Interest income
Interest expense (Depreciation and amortization)		(861,467	)		(882,335	)		(2,615,491	)
Other finance expenses		(2,046,850	)		(1,598,286	)		(362,681	)
Other (expense) income, net		(1,834,921	)		(378,099	)		(2,014,451	)
Total other income, net		(4,743,238	)		(2,858,720	)		(4,992,623	)
INCOME BEFORE INCOME TAXES		(6,881,027	)		(1,343,429	)		(10,839,127	)
PROVISION FOR INCOME TAXES								(1,071	)
NET INCOME		(6,881,027	)		(1,343,429	)		(10,840,198	)
OTHER COMPREHENSIVE INCOME (LOSS)		-			(77,977	)		(511,767	)
Foreign currency translation adjustment		(975,579	)		(688,546	)		(313,039	)
COMPREHENSIVE INCOME		(7,856,606	)		(2,109,952	)		(11,665,004	)
Basic and diluted		(0.55	)		(0.26	)		(4.03	)
EARNINGS PER SHARE
Basic and diluted

Selected Consolidated Cash Flow Data:

	For the Years Ended December 31,
	2020			2019			2018
Net cash (used in) provided by operating activities		(464,142	)		(3,790,254	)		(8,594,304	)
Net cash provided by (used in) investing activities		(1,577,376	)		(1,780,383	)		(663,051	)
Net cash (used in) provided by financing activities		3,495,431			7,093,332			2,461,699
EFFECT OF EXCHANGE RATE ON CASH		(298,841	)		(11,298	)		(158,962	)
NET CHANGE IN CASH AND CASH EQUIVALENTS		1,453,913			1,522,695	)		(6,795,656	)
Cash paid for income tax
Cash paid for interest
Cash and cash equivalents		1,831,673			320,276			7,274,894
Restricted cash
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows		2,986,745			1,831,673			320,276

B. Capitalization and Indebtedness

Not applicable.

C. Reasons for the Offer and Use of Proceeds

Not applicable.

D. Risk Factors

Risks Related to Our Business

An investment in our ordinary shares involves a high degree of risk. You should carefully consider the following information about these risks, together with the other information appearing elsewhere in this registration statement, before deciding to invest in our ordinary shares. The occurrence of any of the following risks could have a material adverse effect on our business, financial condition, results of operations and future growth prospects. In these circumstances, the market price of our ordinary shares could decline, and you may lose all or part of your investment.

We have a limited operating history. There is no assurance that our future operations will result in profitable revenues. If we cannot generate sufficient revenues to operate profitably, we may suspend or cease operations.

Given our limited operating history, there can be no assurance that we can build our business such that we can earn a significant profit or any profit at all. The future of our business will depend upon our ability to obtain and retain customers and when needed, obtain sufficient financing and support from creditors, while we strive to achieve and maintain profitable operations. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the operations that we undertake. There is no history upon which to base any assumption that our business will prove to be successful, and there is significant risk that we will not be able to generate the sales volumes and revenues necessary to achieve profitable operations. To the extent that we cannot achieve our plans and generate revenues which exceed expenses on a consistent basis, our business, results of operations, financial condition and prospects will be materially adversely affected.

Our management team has limited public company experience. We have never operated as a public company in the United States. Our entire management team, as well as other company personnel, will need to devote substantial time to compliance, and may not effectively or efficiently manage our transition into a public company. If we are unable to effectively comply with the regulations applicable to public companies or if we are unable to produce accurate and timely financial statements, which may result in material misstatements in our financial statements or possible restatement of financial results, our stock price may be materially adversely affected, and we may be unable to maintain compliance with the listing requirements of Nasdaq. Any such failures could also result in litigation or regulatory actions by the SEC or other regulatory authorities, loss of investor confidence, delisting of our securities, harm to our reputation and diversion of financial and management resources from the operation of our business, any of which could materially adversely affect our business, financial condition, results of operations and growth prospects. Additionally, the failure of a key employee to perform in his or her current position could result in our inability to continue to grow our business or to implement our business strategy.

We operate in a highly competitive market and the size and resources of many of our competitors may allow them to compete more effectively than we can, preventing us from achieving profitability.

The market for our products is highly competitive. Competition may result in pricing pressures, reduced profit margins or lost market share, or a failure to grow our market share, any of which could substantially harm its business and results of operations. We compete with other companies who are focused on building their brands across multiple product and consumer categories. Across our business, we face competitors who are constantly monitoring and attempting to anticipate consumer tastes and trends, seeking ideas which will appeal to consumers and introducing new products that compete with our products for consumer acceptance and purchase. Many of our competitors have significant competitive advantages, including longer operating histories, larger and broader customer bases, less-costly production, more established relationships with a broader set of suppliers, greater brand recognition and greater financial, research and development, marketing, distribution and other resources than we do.

In addition to existing competitors, the barriers to entry for new participants in the entertainment industry and in the consumer products industry are low, and the increasing importance of digital media, and the heightened connection between digital media and consumer interest, has further increased the ability for new participants to enter our markets, and has broadened the array of companies we may compete with. New participants with a popular product idea or entertainment property can gain access to consumers and become a significant source of competition for our products in a very short period of time. These existing and new competitors may be able to respond more rapidly than us to changes in consumer preferences. Our competitors’ products may achieve greater market acceptance than our products and potentially reduce demand for our products, lower our revenues and lower our profitability.

Our future success depends on our ability to retain key executives and to attract, retain and motivate qualified personnel.

We are highly dependent on the principal members of our executive team listed in this report, the loss of whose services may adversely impact the achievement of our objectives. Recruiting and retaining other qualified employees for our business, including scientific and technical personnel, will also be critical to our success. Competition for skilled personnel is intense and the turnover rate can be high. We may not be able to attract and retain personnel on acceptable terms given the competition among numerous companies for individuals with similar skill sets. The inability to recruit or loss of the services of any executive or key employee could adversely affect our business.

We will need to expand our organization, and we may experience difficulties in managing this growth, which could disrupt our operations.

As of December 31, 2020, we had employees, all of which were full-time employees. As our company matures, we expect to expand our employee base to increase our sales and marketing department. Future growth would impose significant additional responsibilities on our management, including the need to identify, recruit, maintain, motivate and integrate additional employees, consultants and contractors. Also, our management may need to divert a disproportionate amount of its attention away from our day-to- day activities and devote a substantial amount of time to managing these growth activities. We may not be able to effectively manage the expansion of our operations, which may result in weaknesses in our infrastructure, give rise to operational mistakes, loss of business opportunities, loss of employees and reduced productivity among remaining employees. Future growth could require significant capital expenditures and may divert financial resources from other projects, such as the development of our existing or future product candidates. If our management is unable to effectively manage our growth, our expenses may increase more than expected, our ability to generate and grow revenue could be reduced, and we may not be able to implement our business strategy. Our future financial performance and our ability to commercialize our product candidates, if approved, and compete effectively will depend, in part, on our ability to effectively manage any future growth.

We face risks related to health epidemics, severe weather conditions and other outbreaks, in particular, the current escalating coronavirus pandemic.

In recent years, there have been outbreaks of epidemics in various countries. Recently, there was an outbreak of a novel strain of coronavirus (COVID-19), which has spread rapidly to many parts of the world. The outbreak has resulted in quarantines, travel restrictions, and the temporary closure of stores and facilities throughout the world. In March 2020, the World Health Organization declared COVID- 19 a pandemic.

Our results of operations will likely be adversely, and may be materially, affected, to the extent that the COVID-19 or any other epidemic harms the Chinese and global economy in general. Any potential impact to our results will depend on, to a large extent, future developments and new information that may emerge regarding the duration and severity of the COVID-19 outbreak and the actions taken by government authorities and other entities to contain the COVID-19 outbreak or treat its impact, almost all of which are beyond our control. Potential impacts include, but are not limited to, the following:

●

temporary closure of offices, travel restrictions or suspension of services of our customers and suppliers have negatively affected, and could continue to negatively affect, the demand for our services;

●

our customers may require additional time to pay us or fail to pay us at all, which could significantly increase the amount of accounts receivable and require us to record additional allowances for doubtful accounts;

●

the business operations of our distributors have been and could continue to be negatively impacted by the outbreak, which may negatively impact our distribution channel, or result in loss of customers or disruption of our services, which may in turn materially adversely affect our financial condition and operating results; and

●

any disruption of our supply chain, logistics providers or customers could adversely impact our business and results of operations.

Because of the uncertainty surrounding the COVID-19 outbreak, the financial impact related to the outbreak cannot be reasonably estimated at this time, but our consolidated results for the full year 2020 may be adversely affected.

In general, our business could be adversely affected by the effects of epidemics, including, but not limited to, COVID-19, avian influenza, severe acute respiratory syndrome (SARS), the influenza A virus, Ebola virus, severe weather conditions such as a snowstorm, flood or hazardous air pollution, or other outbreaks. In response to an epidemic, severe weather conditions, or other outbreaks, government and other organizations may adopt regulations and policies that could lead to severe disruption to our daily operations, including temporary closure of our offices and other facilities. These severe conditions may cause us and/or our partners to make internal adjustments, including but not limited to, temporarily closing down business, limiting business hours, and setting restrictions on travel and/or visits with clients and partners for a prolonged period of time. Various impacts arising from severe conditions may cause business disruption, resulting in material, adverse impact to our financial condition and results of operations.

Risks Related to Intellectual Property

If we are unable to adequately protect our intellectual property rights, or if we are accused of infringing on the intellectual property rights of others, our competitive position could be harmed or we could be required to incur significant expenses to enforce or defend our rights.

Our commercial success will depend in part on our success in obtaining and maintaining issued patents, trademarks and other intellectual property rights and protecting our proprietary technology. If we do not adequately protect our intellectual property and proprietary technology, competitors may be able to use our technologies or the goodwill we have acquired in the marketplace and erode or negate any competitive advantage we may have, which could harm our business and ability to achieve profitability.

We cannot provide any assurances that any of our patents have, or that any of our pending patent applications that mature into issued patents will include, claims with a scope sufficient to protect our products, any additional features we develop for our products or any new products. Other parties may have developed technologies that may be related or competitive to our system, may have filed or may file patent applications and may have received or may receive patents that overlap or conflict with our patent applications, either by claiming the same methods or devices or by claiming subject matter that could dominate our patent position. Our patent position may involve complex legal and factual questions, and, therefore, the scope, validity and enforceability of any patent claims that we may obtain cannot be predicted with certainty. Patents, if issued, may be challenged, deemed unenforceable, invalidated or circumvented. Proceedings challenging our patents could result in either loss of the patent or denial of the patent application or loss or reduction in the scope of one or more of the claims of the patent or patent application. In addition, such proceedings may be costly. Thus, any patents that we may own may not provide any protection against competitors. Furthermore, an adverse decision in an interference proceeding can result in a third party receiving the patent right sought by us, which in turn could affect our ability to commercialize our products.

Though an issued patent is presumed valid and enforceable, its issuance is not conclusive as to its validity or its enforceability and it may not provide us with adequate proprietary protection or competitive advantages against competitors with similar products. Competitors could purchase our products and attempt to replicate some or all of the competitive advantages we derive from our development efforts, willfully infringe our intellectual property rights, design around our patents, or develop and obtain patent protection for more effective technologies, designs or methods. We may be unable to prevent the unauthorized disclosure or use of our technical knowledge or trade secrets by consultants, suppliers, vendors, former employees and current employees.

Our ability to enforce our patent rights depends on our ability to detect infringement. It may be difficult to detect infringers who do not advertise the components that are used in their products. Moreover, it may be difficult or impossible to obtain evidence of infringement in a competitor’s or potential competitor’s product. We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded if we were to prevail may not be commercially meaningful.

In addition, proceedings to enforce or defend our patents could put our patents at risk of being invalidated, held unenforceable or interpreted narrowly. Such proceedings could also provoke third parties to assert claims against us, including that some or all of the claims in one or more of our patents are invalid or otherwise unenforceable. If any of our patents covering our products are invalidated or found unenforceable, or if a court found that valid, enforceable patents held by third parties covered one or more of our products, our competitive position could be harmed or we could be required to incur significant expenses to enforce or defend our rights.

The degree of future protection for our proprietary rights is uncertain, and we cannot ensure that:

●	any of our patents, or any of our pending patent applications, if issued, will include claims having a scope sufficient to protect our products;

●	any of our pending patent applications will issue as patents;

●	we will be able to successfully commercialize our products on a substantial scale, if approved, before our relevant patents we may have expire;

●	we were the first to make the inventions covered by each of our patents and pending patent applications;

●	we were the first to file patent applications for these inventions;

●	others will not develop similar or alternative technologies that do not infringe our patents; any of our patents will be found to ultimately be valid and enforceable;

●	any patents issued to us will provide a basis for an exclusive market for our commercially viable products, will provide us with any competitive advantages or will not be challenged by third parties;

●	we will develop additional proprietary technologies or products that are separately patentable; or

●	our commercial activities or products will not infringe upon the patents of others.

We rely, in part, upon unpatented trade secrets, unpatented know-how and continuing technological innovation to develop and maintain our competitive position. Further, our trade secrets could otherwise become known or be independently discovered by our competitors.

Litigation or other proceedings or third party claims of intellectual property infringement could require us to spend significant time and money and could prevent us from selling our products or affect our stock price.

Our commercial success will depend in part on not infringing the patents or violating the other proprietary rights of others. Significant litigation regarding patent rights occurs in our industry. Our competitors in both the United States and abroad, many of which have substantially greater resources and have made substantial investments in patent portfolios and competing technologies, may have applied for or obtained or may in the future apply for and obtain, patents that will prevent, limit or otherwise interfere with our ability to make, use and sell our products. We do not always conduct independent reviews of patents issued to third parties. In addition, patent applications can be pending for many years before issuance, or unintentionally abandoned patents or applications can be revived, so there may be applications of others now pending or recently revived patents of which we are unaware. These applications may later result in issued patents, or the revival of previously abandoned patents, that will prevent, limit or otherwise interfere with our ability to make, use or sell our products. Third parties may, in the future, assert claims that we are employing their proprietary technology without authorization, including claims from competitors or from non-practicing entities that have no relevant product revenue and against whom our own patent portfolio may have no deterrent effect. As we continue to commercialize our products in their current or updated forms, launch new products and enter new markets, we expect competitors may claim that one or more of our products infringe their intellectual property rights as part of business strategies designed to impede our successful commercialization and entry into new markets. The large number of patents, the rapid rate of new patent applications and issuances, the complexities of the technology involved, and the uncertainty of litigation may increase the risk of business resources and management’s attention being diverted to patent litigation. We have, and we may in the future, receive letters or other threats or claims from third parties inviting us to take licenses under, or alleging that we infringe, their patents.

Moreover, we may become party to future adversarial proceedings regarding our patent portfolio or the patents of third parties. Patents may be subjected to opposition, post-grant review or comparable proceedings lodged in various foreign, both national and regional, patent offices. The legal threshold for initiating litigation or contested proceedings may be low, so that even lawsuits or proceedings with a low probability of success might be initiated. Litigation and contested proceedings can also be expensive and time-consuming, and our adversaries in these proceedings may have the ability to dedicate substantially greater resources to prosecuting these legal actions than we can. We may also occasionally use these proceedings to challenge the patent rights of others. We cannot be certain that any particular challenge will be successful in limiting or eliminating the challenged patent rights of the third party.

Any lawsuits resulting from such allegations could subject us to significant liability for damages and invalidate our proprietary rights.

Any potential intellectual property litigation also could force us to do one or more of the following:

●	stop making, selling or using products or technologies that allegedly infringe the asserted intellectual property;

●	lose the opportunity to license our technology to others or to collect royalty payments based upon successful protection and assertion of our intellectual property rights against others; incur significant legal expenses;

●	pay substantial damages or royalties to the party whose intellectual property rights we may be found to be infringing;

●	pay the attorney’s fees and costs of litigation to the party whose intellectual property rights we may be found to be infringing;

●	redesign those products that contain the allegedly infringing intellectual property, which could be costly, disruptive and infeasible; and

●	attempt to obtain a license to the relevant intellectual property from third parties, which may not be available on reasonable terms or at all, or from third parties who may attempt to license rights that they do not have.

Any litigation or claim against us, even those without merit, may cause us to incur substantial costs, and could place a significant strain on our financial resources, divert the attention of management from our core business and harm our reputation. If we are found to infringe the intellectual property rights of third parties, we could be required to pay substantial damages (which may be increased up to three times of awarded damages) and/or substantial royalties and could be prevented from selling our products unless we obtain a license or are able to redesign our products to avoid infringement. Any such license may not be available on reasonable terms, if at all, and there can be no assurance that we would be able to redesign our products in a way that would not infringe the intellectual property rights of others. We could encounter delays in product introductions while we attempt to develop alternative methods or products. If we fail to obtain any required licenses or make any necessary changes to our products or technologies, we may have to withdraw existing products from the market or may be unable to commercialize one or more of our products.

If we are unable to protect the confidentiality of our trade secrets, our business and competitive position could be harmed.

In addition to patent protection, we also rely upon copyright and trade secret protection, as well as non-disclosure agreements with our employees, consultants and third parties, to protect our confidential and proprietary information. In addition to contractual measures, we try to protect the confidential nature of our proprietary information using commonly accepted physical and technological security measures. Such measures may not, for example, in the case of misappropriation of a trade secret by an employee or third party with authorized access, provide adequate protection for our proprietary information. Our security measures may not prevent an employee or consultant from misappropriating our trade secrets and providing them to a competitor, and recourse we take against such misconduct may not provide an adequate remedy to protect our interests fully. Unauthorized parties may also attempt to copy or reverse engineer certain aspects of our products that we consider proprietary. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret can be difficult, expensive and time-consuming, and the outcome is unpredictable. Even though we use commonly accepted security measures, trade secret violations are often a matter of state law, and the criteria for protection of trade secrets can vary among different jurisdictions. In addition, trade secrets may be independently developed by others in a manner that could prevent legal recourse by us. If any of our confidential or proprietary information, such as our trade secrets, were to be disclosed or misappropriated, or if any such information was independently developed by a competitor, our business and competitive position could be harmed.

Third parties may assert ownership or commercial rights to inventions we develop.

Third parties may in the future make claims challenging the inventorship or ownership of our intellectual property. We incorporate licensed technology in some of our products. Any infringement claims or lawsuits, even if not meritorious, could be expensive and time consuming to defend, divert management’s attention and resources, require us to redesign our products and services, if feasible, require us to pay royalties or enter into licensing agreements in order to obtain the right to use necessary technologies, and/or may materially disrupt the conduct of our business.

In addition, we may face claims by third parties that our agreements with employees, contractors or consultants obligating them to assign intellectual property to us are ineffective or in conflict with prior or competing contractual obligations of assignment, which could result in ownership disputes regarding intellectual property we have developed or will develop and interfere with our ability to capture the commercial value of such intellectual property. Litigation may be necessary to resolve an ownership dispute, and if we are not successful, we may be precluded from using certain intellectual property or may lose our exclusive rights in that intellectual property. Either outcome could harm our business and competitive position.

Our computer systems and operations may be vulnerable to security breaches.

We expect that the cloud-based applications embedded in our toys will be an important foundation for establishing our company as a leading source of technology. For that reason, among others, the safety of our network and our secure transmission of information over the internet will be essential to our operations and our services. Our network and our computer infrastructure are potentially vulnerable to physical breaches or to the introduction of computer viruses, abuse of use and similar disruptive problems and security breaches that could cause loss (both economic and otherwise), interruptions, delays or loss of services to our users. It is possible that advances in computer capabilities or new technologies could result in a compromise or breach of the technology we use to protect user transaction data. A party that is able to circumvent our security systems could misappropriate proprietary information, cause interruptions in our operations or utilize our network without authorization. Security breaches also could damage our reputation and expose us to a risk of loss, litigation and possible liability. We cannot guarantee you that our security measures will prevent security breaches.

Risks Related to our Ordinary Shares

An active trading market for our ordinary shares may not be sustained.

Our ordinary shares are being listed on Nasdaq in conjunction with this prospectus, and we cannot assure you that an active trading market for our ordinary shares will be sustained or maintained. The lack of an active trading market may impair the value of your shares and your ability to sell your shares at the time you wish to sell them. An inactive trading market may also impair our ability to raise capital by selling shares of our ordinary shares and enter into strategic partnerships or acquire other complementary products, technologies or businesses by using shares of our ordinary shares as consideration. In addition, if we fail to satisfy exchange continued listing standards, we could be de-listed, which would have a negative effect on the price of our ordinary shares.

We expect that the price of our ordinary shares will fluctuate substantially and you may not be able to sell your shares at or above the price you purchased the shares at.

The market price of our ordinary shares is likely to be highly volatile and may fluctuate substantially due to many factors, including:

	●	the volume and timing of sales of our products;

	●	the introduction of new products or product enhancements by us or others in our industry;

	●	disputes or other developments with respect to our or others’ intellectual property rights;

	●	our ability to develop, obtain regulatory clearance or approval for, and market new and enhanced products on a timely basis;

	●	product liability claims or other litigation;

	●	quarterly variations in our results of operations or those of others in our industry;

	●	media exposure of our products or of those of others in our industry;

	●	changes in governmental regulations or in reimbursement;

	●	changes in earnings estimates or recommendations by securities analysts; and

	●	general market conditions and other factors, including factors unrelated to our operating performance or the operating performance of our competitors.

In recent years, the stock markets generally have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of those companies. Broad market and industry factors may significantly affect the market price of our ordinary shares, regardless of our actual operating performance.

In addition, in the past, class action litigation has often been instituted against companies whose securities have experienced periods of volatility in market price. Securities litigation brought against us following volatility in our stock price, regardless of the merit or ultimate results of such litigation, could result in substantial costs, which would hurt our financial condition and operating results and divert management’s attention and resources from our business.

Our ordinary shares are considered to be penny stock. Trading in penny stocks has certain restrictions and these restrictions could negatively affect the price and liquidity of our ordinary shares.

Our ordinary shares trade below $5.00 per share. The SEC has adopted regulations which generally define a “penny stock” to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. As a result, our ordinary shares are considered “penny stock”. A penny stock is subject to rules that impose additional sales practice requirements on broker/dealers who sell securities to persons other than established Members and accredited investors. For transactions covered by these rules, the broker/dealer must make a special suitability determination for the purchase of these securities. In addition, a broker/dealer must receive the purchaser’s written consent to the transaction prior to the purchase and must also provide certain written disclosures to the purchaser. Consequently, the “penny stock” rules may restrict the ability of broker/dealers to sell our ordinary shares, and may negatively affect the ability of holders of shares of our ordinary shares to resell them. These disclosures require you to acknowledge that you understand the risks associated with buying penny stocks and that you can absorb the loss of your entire investment. Penny stocks generally do not have a very high trading volume. Consequently, the price of the stock is often volatile and you may not be able to buy or sell the stock when you want to.

We incur significant additional costs as a result of being a public company, which may adversely affect our business, financial condition and results of operations.

As a public company, we incur significant additional costs associated with corporate governance requirements that apply to us as a public company, including rules and regulations of the SEC, under the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, and the Exchange Act, as well as the rules of Nasdaq. Compliance with these rules and regulations will significantly increase our accounting, legal and financial compliance costs and make some activities more time-consuming. We also expect these rules and regulations could make it more expensive for us to obtain and maintain directors’ and officers’ liability insurance. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors or as executive officers. Accordingly, such increases in costs incurred as a result of becoming a public company may adversely affect our business, financial condition and results of operations.

Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud.

We are subject to the periodic reporting requirements of the Exchange Act. We designed our disclosure controls and procedures to provide reasonable assurance that information we must disclose in reports we file or submit under the Exchange Act is accumulated and communicated to management, and recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. We believe that any disclosure controls and procedures, no matter how well-conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by an unauthorized override of the controls. Accordingly, because of the inherent limitations in our control system, misstatements due to error or fraud may occur and not be detected.

Because we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain.

We have never declared or paid cash dividends. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. As a result, capital appreciation, if any, of our ordinary shares will be your sole source of gain for the foreseeable future.

Securities analysts may not publish favorable research or reports about our business or may publish no information at all, which could cause our stock price or trading volume to decline.

The trading market for our ordinary shares is influenced to some extent by the research and reports that industry or financial analysts publish about us and our business. We do not control these analysts. As a newly public company, we may be slow to attract research coverage and the analysts who publish information about our ordinary shares will have had relatively little experience with us or our industry, which could affect their ability to accurately forecast our results and could make it more likely that we fail to meet their estimates. If any of the analysts who cover us provide inaccurate or unfavorable research or issue an adverse opinion regarding our stock price, our stock price could decline. If one or more of these analysts cease coverage of us or fail to publish reports covering us regularly, we could lose visibility in the market, which in turn could cause our stock price or trading volume to decline and result in the loss of all or a part of your investment in us.

We qualify as a foreign private issuer and, as a result, we are not be subject to U.S. proxy rules and are subject to Exchange Act reporting obligations that permit less detailed and less frequent reporting than that of a U.S. domestic public company.

We report under the Exchange Act as a non-U.S. company with foreign private issuer status. Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including (i) the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; (ii) the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and (iii) the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K upon the occurrence of specified significant events. In addition, our officers, directors and principal shareholders are exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act and the rules thereunder. Therefore, our shareholders may not know on a timely basis when our officers, directors and principal shareholders purchase or sell our ordinary shares. In addition, foreign private issuers are not required to file their registration statement on Form 20-F until 120 days after the end of each fiscal year, while U.S. domestic issuers that are accelerated filers are required to file their registration statement on Form 10-K within 75 days after the end of each fiscal year. Foreign private issuers also are exempt from Regulation Fair Disclosure, aimed at preventing issuers from making selective disclosures of material information. As a result of the above, you may not have the same protections afforded to shareholders of companies that are not foreign private issuers.

If we lose our status as a foreign private issuer, we would be required to comply with the Exchange Act reporting and other requirements applicable to U.S. domestic issuers, which are more detailed and extensive than the requirements for foreign private issuers. We may also be required to make changes in our corporate governance practices in accordance with various SEC and Nasdaq rules. The regulatory and compliance costs to us under U.S. securities laws if we are required to comply with the reporting requirements applicable to a U.S. domestic issuer may be significantly higher than the cost we would incur as a foreign private issuer. As a result, we expect that a loss of foreign private issuer status would increase our legal and financial compliance costs and would make some activities highly time consuming and costly. We also expect that if we were required to comply with the rules and regulations applicable to U.S. domestic issuers, it would make it more difficult and expensive for us to obtain and maintain directors’ and officers’ liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These rules and regulations could also make it more difficult for us to attract and retain qualified members of our board of directors.

As a foreign private issuer, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from Nasdaq corporate governance listing standards. These practices may afford less protection to shareholders than they would enjoy if we complied fully with corporate governance listing standards.

As a foreign private issuer, we are permitted to take advantage of certain provisions in the Nasdaq rules that allow us to follow our home country law for certain governance matters. Certain corporate governance practices in our home country, the Cayman Islands, may differ significantly from corporate governance listing standards. Currently, we do not plan to rely on home country practice with respect to our corporate governance. However, if we choose to follow home country practice in the future, our shareholders may be afforded less protection than they would otherwise enjoy under the Nasdaq corporate governance listing standards applicable to U.S. domestic issuers.

We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses.

As discussed above, we are a foreign private issuer, and therefore, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter. We would lose our foreign private issuer status if, for example, more than 50% of our ordinary shares are directly or indirectly held by residents of the United States and we fail to meet additional requirements necessary to maintain our foreign private issuer status. If we lose our foreign private issuer status on this date, we will be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms, which are more detailed and extensive than the forms available to a foreign private issuer. We will also have to mandatorily comply with U.S. federal proxy requirements, and our officers, directors and principal shareholders will become subject to the short-swing profit disclosure and recovery provisions of Section 16 of the Exchange Act. In addition, we will lose our ability to rely upon exemptions from certain corporate governance requirements under the Nasdaq rules. As a U.S. listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer, and accounting, reporting and other expenses in order to maintain a listing on a U.S. securities exchange.

ITEM 4. INFORMATION ON THE COMPANY

Principal activities

engage:BDR is an internet-based marketplace platform and associated technology solution provider. engage:BDR’s proprietary technology is used to optimise the sale of advertising inventory from digital publishers (websites and apps) to advertisers and their agents (brands, agencies and advertising platforms). The ability to optimise the inventory from digital publishers to advertisers and their agents allows engage:BDR to play an active role in managing the ad exchange platform.

engage:BDR allows digital publishers to monetise their available advertising space by making the inventory available to multiple advertisers, as well as providing various related technologies designed to help publishers create additional incremental revenue streams. engage:BDR’s ad exchange platform also allows publishers to sell space for video advertising on webpages that do not have video content. The company was formed on August 17,2017 in Melbourne, Australia.

Dividends

There were no dividends paid, recommended or declared during the current or previous financial year.

Review of operations

The loss for the consolidated entity after providing for income tax amounted to $6,881,027 31 December 2020 (31 December 2019: loss of $1,343,429).

Programmatic display, native and video advertising sales

The Group’s Programmatic advertising sales includes selling display, native and video advertising inventory through the Group’s digital auctioning technology to platforms and marketplaces. The Group developed this product to replace the traditional Non-Programmatic display advertising channel. The adoption of programmatic display advertising sales has proven to be extremely successful in 2020 and opened additional revenue opportunities from the same clients, largely because programmatic buying and selling of advertising is much more efficient and significantly more cost effective to operate, thus increasing the Group’s overall operating and gross profit margins.

Advertising buyers, through the Group’s programmatic platform, are essentially bidding for advertising inventory in real time in dynamic auctions, which occur in milliseconds while the relevant mobile or CTV app content is loading. This new engage:BDR format has created significant barriers to entry for new companies looking to enter the digital advertising arena. Companies must realistically own and develop their own proprietary technology to be able to participate in the rapidly developing programmatic advertising ecosystem as licensing third party technologies is cost-prohibitive. engage:BDR has developed its own real-time auctioning and bidding technologies which provide it with a significant competitive advantage. engage:BDR has established thousands of direct publisher relationships which is a key differentiator and competitive advantage for the Group in an ecosystem which is experiencing inventory quality issues, brokers and middlemen.

Adcel, our mobile app buyer mediation platform now fully supports Connected TV (CTV) app monetization through ads and has begun onboarding Connected TV app supply. Connected TV apps that live both on televisions and mobile devices (ad supported streaming video applications) have grown in adoption significantly by consumers who are “cord cutting” (eliminating traditional cable subscriptions) in favor of streaming content and the ability to access content anywhere they are, simply by logging into their streaming service. Accessing supply for CTV is essentially the same as any standard display, video or native inventory and is sold to advertisers in the same fashion as traditional online video ads are sold, through real time bidding. The allure of CTV for advertisers is the opportunity to deliver highly targeted ads to a captive audience across all the screens in their household, versus traditional TV ads; where scale, targeting and pricing efficiency are limited.

As EngageBDR’s entrance into CTV is met with competition, our primary sales strategy is powerful technology combined with quicker payments in comparison to our competitors. A common pain point by publishers historically has been slow payment terms from their monetization partners; net 60+ is commonplace. When working directly with agencies, net 120+. This places significant constraints on publishers who are faced with limited capital to scale their businesses; the inability to pay writers and for content production inhibits growth. EngageBDR’s net zero payment terms allow publishers to get paid immediately upon receipt of their invoice, giving EngageBDR negotiation leverage when setting placement cost, volume availability and positioning in the publisher’s monetization waterfall; allowing us to gain preferential opportunities and incentive to integrate.

EngageBDR’s programmatic advertising inventory is comprised of advertising space which is also commonly referred to as “ad placements” across a publisher’s website or mobile/connected television application. The ad placements are created by the publisher with an and integrated into their site to allow for monetization of their site or apps.

EngageBDR accesses this inventory through a number of different integration methods, ranging from direct JavaScript ad tag placement within the publisher’s ad-server, auction style programmatic header bidding integrations, or direct integrations with the publisher’s ad mediation technology (RTB). All the aforementioned integration types will require a contract to be negotiated prior to engaging in an integration and transacting on their inventory. Upon completion of an integration with a publisher through any of the strategies previously mentioned, EngageBDR will begin to present the publisher’s supply to our advertisers and buyers.

As our publishers receive site visitors, EngageBDR is sent requests to show ads to those visitors in real time. Upon receipt of this ad request, EngageBDR examines the bid request to determine if the user’s location, behavioral profile, time of day, device type, operating systems etc, fit existing targeting parameters set forth by our advertisers. If all conditions are met, EngageBDR will submit a bid price that we are willing to pay, typically within 120MS or less from receiving the initial request. Upon winning the auction, EngageBDR will serve our advertiser’s ad and will bill the advertiser for the served ad impression based on first or second price auction dictated by the publisher.

Collaborative Marketing revenue is all revenue received from our influencer marketing platform Iconic Reach. Programmatic revenue is all revenue that comes from our programmatic marketing platform known as Rexer. EngageBDR’s mobile app and CTV platform Adcel works with our programmatic platform Rexer to help distribute available supply to programmatic buyers who have integrated with Rexer. The relationship between Adcel and Rexer is that Rexer serves as a demand source (buyer) of Adcel’s supply. When ad inventory is available on Adcel, an ad request is sent to all of Adcel’s buyer’s in real time, one of which is Rexer. Rexer will then present this ad request to it’s proprietary programmatic buyers as an opportunity to bid on an ad slot to help Adcel publishers better sell through their available advertising inventory.

Influencer Marketing

Mobile and Connected Television (CTV) App Ads

The Group expects continued growth in supply and demand integration onboarding specifically within AdCel for 2021, as AdCel's technology has matured to a stage in which it is capable of monetizing inventory across ConnectedTV Apps. In addition to its core competency of App monetization across mobile devices. AdCel is one of the first demand agnostic mediation technologies available for ConnectedTV publishers in the market, solving an inherent problem in the ConnectedTV ecosystem. AdCel enables publishers the unique ability to mediate multiple sources of demand in one platform, utilizing intelligent personalization powered by the AdCel machine learning algorithm to maximize yield and minimize human error and time spent performing manual optimization. As supply and demand partnerships are established and integrated by sales and engineering, revenue is expected to steadily ramp throughout the course of the year. AdCel will continue to focus onboarding significant volumes of new ConnectedTV and mobile App publishers through the group's NetZero payment product, enabling publisher payments the same day the group is invoiced.

Significant changes in the state of affairs

On 17 January 2020, the Company issued 26,975,464 fully paid ordinary shares at $0.017 (1.7 cents) per share in accordance with the terms and conditions of the Convertible Securities Purchase Agreement (Agreement) with Alto Opportunity Master Fund SPC - Segregated Master Portfolio B (Alto). The Company was required to issue replenishment Collateral Shares under the Agreement. On 3 March 2020, the Company issued 30,420,738 replenishment fully paid ordinary shares at $0.013 (1.3 cents) per share in accordance with the terms and conditions of the Agreement with Alto.

On 13 March 2020, the Company announced a further drawdown of a zero coupon convertible amortising security (ZCS) with a face value of US$450,000 at an issue price of US$382,500. The ZCS was issued to Alto pursuant to the Agreement. The ZCS is secured with a maturity of 31 May 2021.

The ZCS is convertible at the election of Alto at the rate of one fully paid ordinary share for every A$0.35 (35 cents) of the face value converted, at the US$/A$ exchange rate published by the Reserve Bank of Australia on the day before the conversion.

On 1 April 2020, the Company issued 38,412,579 fully paid ordinary shares for settlement of outstanding creditor balances at a deemed issue price of $0.017 (1.7 cents) per share.

On 1 April 2020, the Company issued 107,500,000 Performance Rights as approved in the General Meeting on 18 March 2020. The Performance Rights were issued in accordance with the Company's Options and Performance Rights Plan.

Furthermore, on 1 April 2020 the Company also issued 17,100,000 unlisted options as approved in the General Meeting on 18 March 2020. The options were split into three equal tranches with the following terms:

●	Exercise price of $0.0201, vesting upon issue, with an expiry of 3 years after date of issue;
●	Exercise price of $0.0217, vesting 12 months after issue, with an expiry of 3 years after date of issue; and
●	Exercise price of $0.0233, vesting 24 months after issue, with an expiry of 3 years after date of issue.

The options were issued in accordance with the Company's Options and Performance Rights Plan.

On 27 April 2020, the Company issued 82,000,000 ordinary shares with a nil issue price following achievement of performance hurdles and conversion of performance rights held by executive directors and employees of the Company.

On 7 May 2020, the Company issued 32,123,198 replenishment fully paid ordinary shares at $0.01 (1 cent) per share in accordance with the terms and conditions of the Agreement with Alto.

On 11 June 2020, the Company issued 40,423,775 replenishment fully paid ordinary shares at $0.006 (0.6 cents) per share in accordance with the terms and conditions of the Agreement with Alto.

Furthermore, the Company also issued 30,000,000 fully paid ordinary shares for settlement of outstanding creditor balances at a deemed issue price of $0.008 (0.8 cents) per share.

On 18 June 2020, the Company issued 38,259,130 replenishment fully paid ordinary shares at $0.004 (0.4 cents) per share in accordance with the terms and conditions of the Agreement with Alto.

On 17 July 2020, the Company issued 52,730,441 fully paid ordinary shares at $0.004 (0.4 cents) per share in accordance with the terms and conditions of the Convertible Securities Purchase Agreement (Agreement) with Alto Opportunity Master Fund SPC - Segregated Master Portfolio B (Alto).

On 17 July 2020, the Company also issued 55,736,356 fully paid ordinary shares for settlement of outstanding creditor balances at a deemed issue price of $0.008 (0.8 cents) per share.

On 28 July 2020, the Company issued 62,646,249 replenishment fully paid ordinary shares at $0.004 (0.4 cents) per share in accordance with the terms and conditions of the Agreement with Alto.

In addition, on 28 July 2020 the Company also issued 61,939,034 fully paid ordinary shares for settlement of outstanding creditor balances at a deemed issue price of $0.009 (0.9 cents) per share.

On 14 August 2020, the Company issued 293,921,246 fully paid ordinary shares at an issue price of $0.0073 (0.73 cents) per share to professional and sophisticated investors in relation to the Placement as announced on 11 August 2020.

On 21 August 2020, the Company issued 80,318,305 replenishment fully paid ordinary shares at $0.005 (0.5 cents) per share in accordance with the terms and conditions of the Agreement with Alto.

On 11 September 2020, the Company issued 85,254,184 replenishment fully paid ordinary shares at $0.005 (0.5 cents) per share in accordance with the terms and conditions of the Agreement with Alto.

On 1 December 2020, the Company has issued 430,888,917 fully paid ordinary shares at an issue price of $0.0055 (0.55 cents) per share to professional and sophisticated investors in relation to Placement announced on 25 November 2020.

On 16 December 2020, the Company issued 216,299,959 SPP shares under the Share Purchase Plan which was announced on 25 November 2020. The Company issued the SPP shares at $0.0055 (0.55 cents) raising $1,189,650.

There were no other significant changes in the state of affairs of the consolidated entity during the financial year.

Matters subsequent to the end of the financial year

No matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.

Likely developments and expected results of operations

Growth of programmatic and mobile app (AdCel) ad revenues the proprietary platforms

With AdCel being one of the first platforms to offer a solution focused for ConnectedTV app mediation and with a number of partnerships both established and in the queue. The Group expects to grow programmatic ConnectedTV and mobile app ad revenues steadily and significantly throughout 2021. These revenues are no longer dependent on third party technologies as they were previously. As a result of our ability to directly represent a publisher's supply through AdCel's mediation, the Group will have the most optimized supply path to a publisher's inventory; creating cost efficiency, and the ability to generate greater scale for the Group's clients. Lastly, this optimized supply path will be key in attracting new demand partnership integrations for AdCel and will provide differentiation in the market stemming from buyers interested in cost efficiency, scale, and unduplicated supply opportunities. As these supply and demand partnerships are integrated by the engineering teams, the revenue is expected to grow steadily throughout the year.

Continued growth of programmatic display, native and video revenue

The Group also expects to see continued growth of its programmatic display, native and video businesses. Through monetisation of existing partnerships and creation of new ones, the Group expects to be able to significantly scale revenue while maintaining its lower cost operations. This enables optimisation of the Group’s existing relationships and the ability to attract new buyers and sellers.

Growth of influencer marketing revenue

The Group brought in incremental revenue through this platform. The Group paused Iconic Reach efforts in March 2020, in light of the COVID-19 pandemic and reallocated resources. The Group anticipates continuing to be paused for the year 2021 and plans to revisit in 2022. Iconic Reach is a self service marketplace which allows brands to collaborate with social media influencers across Tik Tok, Instagram, Youtube, Snapchat and Facebook. Iconic Reach enables brands to partner with powerful, relevant influencers who fit their campaign initiatives through a self service interface, allowing influencers to be sorted by content categories, audience authenticity, reach, location and cost to help eliminate the guesswork involved in contracting with influencers. Iconic Reach bills brands a margin on top of the influencer’s cost for use of the platform. Revenues are received from the advertisers.

1440 influencers joined / 2 new brand beta clients joined in 2020

Environmental regulation

The consolidated entity is not subject to any significant environmental regulation under Australian Commonwealth or State law.

ITEM 4A. UNRESOLVED STAFF COMMENTS

None.

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and the related notes included elsewhere in this registration statement on Form 20-F. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Item 3. Key Information—D. Risk Factors” or in other parts of this registration statement on Form 20-F.

A. Operating results

Results of Operations

Comparison of Years Ended December 31, 2020 and December 31, 2019

	For the Years ended December 31,
	2020			2019			Change			Percentage Change
Revenues		15,398,413			17,079,118			(1,680,705	)		-10	%
Cost of revenues		(9,420,757	)		(7,794,937	)		1,625,820			21	%
Gross profit		5,977,656			9,284,181			(3,306,525	)		-36	%
Selling expenses		(138,984	)		(109,301	)		29,683			-27	%
General and administrative expenses		(7,976,461	)		(7,659,589	)		316,872			-4	%
Research and development
Income from operations		(2,137,789	)		1,515,291			3,653,080			-241	%
Other income, net		(4,743,238	)		(2,858,720	)		1,884,518			-65	%
Provision for income taxes
Net income		(6,881,027	)		(1,343,429	)		(5,537,598	)		412	%

Revenues

Our revenues from 2020 over 2019 decreased by $1,680,705 or 10% as a result of COVID-19. Advertisers reserving their spend due to the unknowns with the economy.

Cost of Revenues

Our cost of revenues from 2020 over 2019 increased by $1,625,820 or 21% as a result of onboarding new publishers for a diverse inventory to accommodate advertisers for the unknown of COVID-19.

Gross Profit

Our gross profit from 2020 over 2019 decreased by $3,306,525 or 36% as a result of COVID-19 unknown factors to the economy. Advertisers reserve on spend while onboarding publishers for a diversity of inventory to accommodate the possibilities of their spend.

Operating Expenses

Our operating expenses from 2020 over 2019 decreased by $346,555 or 31% as a result of adjustments made to adapt to COVID-19 working remotely.

Other income, net

Our other income, net from 2020 over 2019 decreased by $1,884,518 or 65% as a result of revenue loss due to COVID-19.

Income tax expense

Our income tax from 2020 over 2019 remained the same no tax.

Net income

Our net income from 2020 over 2019 decreased by 5,537,598 or 412% as a result of loss of revenue due to the uncertainties of COVID-19. Advertisers holding their spend and minimal advertising being used.

Comparison of Years Ended December 31, 2019 and December 31, 2018

	For the Years ended December 31,
	2019			2018			Change			Percentage Change
Revenues		17,079,118			11,443,935			5,635,183			49	%
Cost of revenues		(7,794,937	)		(5,632,553	)		2,162,384			38	%
Gross profit		9,284,181			5,811,382			3,472,799			60	%
Selling expenses		(109,301	)		(269,667	)		(160,366	)		59	%
General and administrative expenses		(7,659,589	)		(11,388,219	)		(3,811,900	)		33	%
Research and development
Income from operations		1,515,291			(5,846,504	)		7,445,065			126	%
Other income, net		(2,858,720	)		(4,992,623	)		(2,050,633	)		42	%
Provision for income taxes					(1,071	)		(1,071	)		100	%
Net income		(1,343,429	)		(10,840,198	)		(9,496,769	)		88	%

Revenues

Our revenues from 2019 over 2018 increased by $5,635,183 or 49%. Prioritized the focus of growing programmatic business (REXER). Brought on more supply to gain more traffic for customers to increase volume.

Cost of Revenues

Our cost of revenues from 2019 over 2018 increased by $2,162,384 or 38% as a result of onboarding of new vendors. The prioritization of programmatic business needed to have the supply to increase our volume and monetize more.

Gross Profit

Our gross profit from 2019 over 2018 increased by $3,472,799 or 60% the prioritization of programmatic business increasing our supply and monetize the traffic for customers.

Operating Expenses

Our operating expenses from 2019 over 2018 decreased by $3,972,266 or 92% as a result of reduction of operational expenses such as reduction in rent space. We minimize staff which in turn reduced the employee/contractor costs from 2018.

Other income, net

Our other income, net from 2019 over 2018 decreased by $2,050,633 or 42% as a result of reclassification from other income to cost of revenue.

Income tax expense

Our income tax from 2019 over 2018 decreased by $(1,071) or 100% as a result of not income tax as it relates to local tax.

Net income

Our net income from 2019 over 2018 increased by 9,496,769 or 88% as a result of reduction of operational costs ex. employee/ contractor costs. The increase in revenue and monetization of prioritizing REXER traffic.

B. Liquidity and capital resources

Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and ensuring that all term deposits can be converted to funds in accordance with forecast cash usage. Due to the dynamic nature of the underlying business, flexibility in funding is maintained by ensuring ready access to the cash reserves of the business.

The ongoing maintenance of the Group’s policy is characterized by ongoing cash flow forecast analysis and detailed budgeting processes which, is directed at providing a sound financial positioning for the Group’s operations and financial management activities. In addition, the Group monitors both the debt and equity markets for additional funding opportunities.

Statement of cash flows

	For the Years Ended December 31,
	2020			2019			2018
Net cash (used in) provided by operating activities		(464,142	)		(3,790,254	)		(8,594,304	)
Net cash provided by (used in) investing activities		(1,577,376	)		(1,780,383	)		(663,051	)
Net cash (used in) provided by financing activities		3,495,431			7,093,332			2,461,699
EFFECT OF EXCHANGE RATE ON CASH		(298,841	)		(11,298	)		(158,962	)
NET CHANGE IN CASH AND CASH EQUIVALENTS		1,453,913			1,522,695	)		(6,795,656	)
Cash paid for income tax
Cash paid for interest
Cash and cash equivalents		1,831,673			320,276			7,274,894
Restricted cash
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows		2,986,745			1,831,673			320,276

Operating Activities: 2018 had the most operational expenses relating to employee/contractor costs and main operations such as rent, etc. Our staff count was at our highest in relation to these periods in 2018. Revenue and cost of revenues was not substantial enough to offset those costs. 2019 the reduction of staff personnel took place to cut back costs. Revenue prioritization focus brought on more supply (Cost of Revenue) to monetize and traffic to increase volume. 2020 the share-based payments and increased in finance costs. We factor our receivables and which in turn was the decrease in trade and other receivables.

Investing Activities: In all three periods the contributor to this category was our capitalized software. Each year the projects differ, and the time allocated to each.

Financing Activities: 2018 was the initial convertible note at the later part of the year. The initial drawdown was made in November 2018. 2019 repayments were made, and additional drawdown made. Once the repayment was completed a second convertible note was issued. 2020 repayments were made an additional drawdown from the second convertible note. The second half of the year capital raises were successful which were the majority of the financing activity.

During the year ended 31 December 2020, the Group improved its net asset position by settling legacy creditors by a way of share issues. The Group also raised additional capital through a share purchase plan from existing professional and sophisticated investors and zero coupon convertible amortising securities (“ZCSs”) (Refer to note 14). As at the date of this report the directors have assessed that the Group continues to comply with the covenants set under its financing arrangements with its debtor factoring facility and those set by Alto Capital.

Notwithstanding the above the Directors consider the going concern basis to be appropriate giving consideration to:

● Confidence in raising capital as needed;

● Confidence in achieving the group’s forecast revenues and positive operating cash flow in 2021 through continued completion of planned integrations onto the group’s programmatic advertising platform;

● The ability of the Group to settle ZCS note and outstanding creditors via share issue, instead of cash payments;

● Repayment of some or all of secured related party loan receivables;

● The Group’s ability, if required, to seek the support from its founders and major shareholders for the further injection of capital; and

● Its ability to exercise control over discretionary operational cash outflows.

The convertible notes have been repaid in full and extinguished. With the latest capital raises and the overwhelming response, the confidence to do more if need be is possible. Our current working capital is sufficient as noted in the latest financial statements from 2020. Our forecasted revenues are set to be increased and reaching our positive operating cash flow continue to be on target. COVID-19 had advertisers reserving their cash and as we are in the 2^nd quarter of 2021 we have seen that projections as to revenue we are moving in a positive direction.

(i) Financial arrangements

The Group had the following borrowing facilities at the end of the reporting period.

	Drawn		Undrawn		Total
2020	$		$		$

Fixed rate
Debtor factoring borrowings (a)		1,904,104		-		1,904,104
Convertible notes (b)		271,814		37,173,006		37,444,820

		2,175,918		37,173,006		39,348,924

(a)	The Group has an arrangement with a third party to provide an asset backed credit line against trade receivables which are up to 180 days old. Under this arrangement, advances are recorded against certain receivables balances which are factored under the facility. All amounts invoiced are in US Dollars. This arrangement has no expiration date with an interest rate of 8.00%.
(b)	Convertible notes were issued on 13 March 2020. Face value of drawn portion is US$450,000 (AU$584,264). The face value of total undrawn is US$28,840,000 (AU$37,444,820). The convertible notes expire on 31 May 2021.

	Drawn		Undrawn		Total
2019	$		$		$

Fixed rate
Debtor factoring borrowings (a)		4,213,186		-		4,213,186
Convertible notes (b)		2,497,859		34,970,026		37,467,885

		6,711,045		34,970,026		41,681,071

(a)

During the period, the Group entered into an arrangement with a third party to provide an asset backed credit line against trade receivables which are up to 180 days old. Under this arrangement, advances are recorded against certain receivables balances which are factored under the facility. All amounts invoiced are in US Dollars. This arrangement has no expiration date with an interest rate of 8.00%.

(b)

Convertible notes were issued on 19 September 2019. Face value of drawn portion is US$2,060,000 (AU$2,940,336). The face value of total undrawn is US$28,840,000 (AU$41,164,716). The convertible notes expire on 30 November 2020.

	Drawn		Undrawn		Total
2018	$		$		$

Fixed rate
Loan Notes*		880,938		1,064,468		1,945,406
Convertible notes		-		4,798,991		4,798,991

Total		880,938		5,863,459		6,744,397

* Loan notes were issued on 20 November 2018. On 29 January 2019, a resolution was passed during a shareholder general meeting to issue convertible securities in replacement of the Loan notes. As of 31 December 2019 these have been fully paid.

(ii) Maturities of financial liabilities

The following table summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments.

	Less than 6 months		Between 6 to 12 months		Between 1 and 2 years		Between 2 and 3 years		Remaining contractual maturities
	$		$		$		$		$
Consolidated – 2020
Trade and other payables		3,647,691		-		-		-		3,647,691
Credit card liabilities		2,906		-		-		-		2,906
Borrowings - Due to factor*		1,904,104		-		-		-		1,904,104
Convertible notes payable**		214,050		-		-		-		214,050
Borrowings (principal) - Promissory notes		15,893		-		-		-		15,893
Current portion of lease liability		78,927		78,927		-		-		157,854
Non-current portion of lease liability		-		-		87,345		-		87,345
Borrowings – Other		135,546								135,546
Total non-derivatives		5,999,117		78,927		87,345		-		6,165,389

*	Borrowings represent the advances recorded against certain receivables balances which are factored under the facility.
**	Convertible notes were issued on 13 March 2020. Face value of drawn portion is US$450,000 (AU$584,264). The face value of total undrawn is US$28,840,000 (AU$37,444,820). The convertible notes expire on 31 May 2021.

	Less than 6 months		Between 6 to 12 months		Between 1 and 2 years		Between 2 and 3 years		Remaining contractual maturities
	$		$		$		$		$
Consolidated – 2019
Trade and other payables		5,882,586		-		-		-		5,882,586
Credit card liabilities		13,852		-		-		-		13,852
Borrowings - Due to factor*		4,216,126		-		-		-		4,216,126
Convertible notes payable**		1,424,527		949,684		-		-		2,374,211
Borrowings (principal) - Promissory notes		55,349		-		-		-		55,349
Borrowings – Other		148,512								148,512
Total non-derivatives		11,740,952		949,684		-		-		12,690,636

*	Borrowings represent the advances recorded against certain receivables balances which are factored under the facility.
**	Convertible note balance comprised of the principal and interest payable the Group entered in on 19 September 2019. The convertible note expires on 18 November 2020.

	Less than 6 months		Between 6 and 12 months		Between 1 and 2 years		Between 2 and 3 years		Remaining contractual maturities
	$		$		$		$		$
Consolidated – 2018
Trade and other payables		11,357,346		2,892		-		-		11,360,238
Credit card liabilities		441,173		-		-		-		441,173
Borrowings - Due to factor		1,048,731		-		-		-		1,048,731
Borrowings (principal) - Promissory notes		668,770		-		-		-		668,770
Loan notes		880,938		-		-		-		880,938
Deferred payable		1,055,057								1,055,057
Total non-derivatives		15,452,015		2,892		-		-		15,454,907

(iii) Fair value of financial instruments

Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.

Capital management strategy

The Group’s policy is to maintain a capital structure for the business which ensures sufficient liquidity, provides support for business operations, maintains shareholder confidence and positions the business for future growth. The Group manages its capital structure and makes adjustments in light of changes in economic conditions.

The ongoing maintenance of the Group’s policy is characterised by ongoing cash flow forecast analysis and detailed budgeting processes which, combined with continual development of banking relationships, is directed at providing a sound financial positioning for the Group’s operations and financial management activities.

The Group has an ASX-imposed restriction of 15% of total share capital per annum on the amount of share capital it can issue under a placement, which may be increased by a further 10% under a special resolution put to shareholders at its general meetings.

Capital Expenditures

In the years ended December 31, 2020, 2019 and 2018, our capital expenditures were mainly used for our working capital requirements such as staff costs, sales and marketing expenses and research and development costs. We have not had any material commitments for capital expenditures for the last three financial years. We plan to continue to make capital expenditures to meet the needs that result from the expected growth of our business.

C. Research and development, patents and licenses, etc.

Research costs are expensed as incurred. An intangible asset arising from development expenditure on an internal project is recognized only when the Company can demonstrate the technical feasibility of completing the intangible asset so that it will be available for use or sale, its intention to complete and its ability to use or sell the asset, how the asset will generate future economic benefits, the availability of resources to complete the development and the ability to measure reliably the expenditure attributable to the intangible asset during its development.

D. Trend information

Other than as described elsewhere in this registration statement, we are not aware of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material adverse effect on our revenue, income from continuing operations, profitability, liquidity or capital resources, or that would cause our reported financial information not necessarily to be indicative of future operation results or financial condition.

EngageBDR’s focus on Connected Television is prompted by numerous shifts in consumer attention as traditional cable subscriptions are falling, and consumers are leaning towards lower cost streaming television platforms, such as Netflix, Hulu, Pluto.TV and more. The need to be able to reach these consumers remains important to brands who were previously marketing to through traditional TV advertising campaigns.

As brands are shifting their budgets towards buying connected TV supply, they are recognizing the increase in performance over traditional TV by way of being able to target consumers by their IP addresses and devices within their households. The ability to deliver advertising campaigns to a much more targeted audience has fueled tremendous growth in CTV for the past few years, with the expectation that CTV will grow to an $18 billion dollar market by 2024.

Additionally, According to a November 2020 poll from the Interactive Advertising Bureau (IAB), 60% of US advertisers planned to shift ad dollars from linear TV to either CTV or OTT in 2021. Among those planning to do this, 81% cited targeting and efficiency as a reason, while 55% pointed to incremental reach. As of 2021, Nearly 79% of people in the United States use streaming services to watch TV.

E. Off-balance sheet arrangements

We have no off-balance sheet arrangements including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits.

F. Tabular disclosure of contractual obligations

As of December 31, 2020, the future minimum payments under certain of our contractual obligations were as follows:

	Payments Due By Period
Contractual obligations	Total		Less than 1 year		1 – 3 years		3 – 5 years	More than 5 years
Loan obligations		5,920,190		5,920,190
Operating lease obligations		245,199		157,854		87,345
Other payables -related party
Long-term debt obligations*
Total		6,165,389		6,078,044		87,345

*	Represent future value of long-term debt obligations.

G. Safe harbor

See “Forward-Looking Statements” on page iii of this registration statement.

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A. Directors and Senior Management

See disclosure above in this report for directors.

Youqi Li (Chief Technology Officer)

Youqi Li

Chief Technology Officer -

Youqi Li is the Chief Technology Officer at engage:BDR. In his role, he leads the engineering team in Research and Development, planning and execution of the product roadmap, and forecasting technical direction of the organization.

Youqi has over ten years of experience in software development and six years of experience within the digital advertising industry. He joined engage:BDR in its early stages and helped to build the engineering team from the ground up. Prior to that, he worked in multiple startups and research centers, which helped him develop agile and open-minded technical expertise.

Youqi received his Master’s Degree in Computer Science from the University of Southern California.

Engage BDR April 2010 - Present

Andy Dhanik (Chief Revenue Officer)

Andy Dhanik is Chief Revenue Officer for engage:BDR. In his role, he oversees all teams responsible for operational processes including on-boarding and management of clients and campaigns, ongoing maintenance of advertising campaigns across all platforms, managing the campaign management team in optimizations, providing strategic product-specific insight to advertisers, and strategically aligning client needs with internal production teams to innovate and release products that provide value and performance for clients.

Engage BDR March 2011- Present

Denys Kravchenko (Chief Technology Officer - AdCel)

Denys Kravchenko

Chief Technology Officer Adcel

15+ years of experience in engineering, product architecture, big data analysis, business development and strategic expansion.

Currently is responsible for shaping the company’s overall strategic technology direction, including oversight of day-to-day technology and engineering operations at AdCel by engageBDR.

Previously, helped to grow Lovetime.com, the largest dating website in South-Eastern Asia with an audience of 5 million unique users. NetPromoter one-stop service for all things SEO.

Managed teams of 40+ people of back-end/front-end/QA engineers, designers and data scientists. Lead SEOPult Ukraine. By 2012, grew from 0 to $54mm in revenue in 3 years, with 536,000 web sites relying on their technology, and over 17mm keywords used to run SEOPult’s automated SEO platform

Appontops Corp Feb 2015 - May 2019

The Argon Group Oct 2017 - Aug 2018

Acel Oct 2016 - Present

Engage BDR SVP Mobile Aug - 2018 - Present

Ted Dhanik and Andy Dhanik are brothers.

B. Compensation

Employment Agreements, Director Agreements and Indemnification Agreements

Service agreements

Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details of these agreements are as follows:

Name:		Ted Dhanik
Title:		Executive Chairman and Chief Executive Officer
Agreement commenced:		14 December 2017
Term of agreement:		3 years subject to re-election at any relevant Company Annual General Meeting.
Details:		The fee payable to Director is to be USD$330,000 plus statutory superannuation entitlements per annum from the commencement date. Such fees to be reviewed on each anniversary of the agreement or whenever determined by the Board.

		Where for any reason the fees owing to the Director for the services of the Director are not paid for any period of the engagement, or where there are any fees or monies outstanding to Director, the Company will accrue those fees and Director may at its sole option agree for those fees to be paid in the form of fully paid ordinary shares in the Company, subject at all times to the Company obtaining all necessary regulatory and shareholder approvals.

		The Director may resign at any time by given written notice to the Company.

Name:		Kurtis Rintala
Title:		Executive Director and Chief Operating Officer
Agreement commenced:		14 December 2017
Term of agreement:		3 years subject to re-election at any relevant Company Annual General Meeting.
Details:		The fee payable to Director is to be USD$235,000 plus statutory superannuation entitlements per annum from the commencement date. Such fees to be reviewed on each anniversary of the agreement or whenever determined by the Board.

		Where for any reason the fees owing to the Director for the services of the Director are not paid for any period of the engagement, or where there are any fees or monies outstanding to Director, the Company will accrue those fees and Director may at its sole option agree for those fees to be paid in the form of fully paid ordinary shares in the Company, subject at all times to the Company obtaining all necessary regulatory and shareholder approvals.

		The Director may resign at any time by given written notice to the Company.

Name:		Darian Pizem
Title:		Non-Executive Director
Agreement commenced:		30 October 2018
Term of agreement:		3 years subject to re-election at any relevant Company Annual General Meeting.
Details:		The fee payable to Director is to be AUD$40,000 plus statutory superannuation entitlements per annum from the commencement date. Such fees to be reviewed on each anniversary of the agreement or whenever determined by the Board.

		Where for any reason the fees owing to the Director for the services of the Director are not paid for any period of the engagement, or where there are any fees or monies outstanding to Director, the Company will accrue those fees and Director may at its sole option agree for those fees to be paid in the form of fully paid ordinary shares in the Company, subject at all times to the Company obtaining all necessary regulatory and shareholder approvals.

		The Director may resign at any time by given written notice to the Company.

Name:		Tom Anderson
Title:		Non-Executive Director
Agreement commenced:		17 August 2017
Term of agreement:		3 years subject to re-election at any relevant Company Annual General Meeting.
Details:		The fee payable to Director is to be USD$45,000 plus statutory superannuation entitlements per annum from the commencement date. Such fees to be reviewed on each anniversary of the agreement or whenever determined by the Board.

		Where for any reason the fees owing to the Director for the services of the Director are not paid for any period of the engagement, or where there are any fees or monies outstanding to Director, the Company will accrue those fees and Director may at its sole option agree for those fees to be paid in the form of fully paid ordinary shares in the Company, subject at all times to the Company obtaining all necessary regulatory and shareholder approvals.

		The Director may resign at any time by given written notice to the Company.

Name:		Robert Antulov
Title:		Non-Executive Director
Agreement commenced:		23 November 2018
Term of agreement:		3 years subject to re-election at any relevant Company Annual General Meeting.
Details:		The fee payable to Director is to be AUD$40,000 plus statutory superannuation entitlements per annum from the commencement date. Such fees to be reviewed on each anniversary of the agreement or whenever determined by the Board.

		Where for any reason the fees owing to the Director for the services of the Director are not paid for any period of the engagement, or where there are any fees or monies outstanding to Director, the Company will accrue those fees and Director may at its sole option agree for those fees to be paid in the form of fully paid ordinary shares in the Company, subject at all times to the Company obtaining all necessary regulatory and shareholder approvals.

		The Director may resign at any time by given written notice to the Company.

Name:		Youqi Li
Title:		Chief Technology Officer
Agreement commenced:		27 August 2015; no agreement to file in exhibit.
Term of agreement:		Ongoing
Details:		Mr Li receives an remuneration package including salary and pension of AUD$249,785 (USD$175,000) per annum. Payment of a benefit on early termination by the Group without cause is equal to 2 months’ base salary.

		Notice period - 6 months

Name:		Andy Dhanik
Title:		Chief Revenue Officer
Agreement commenced:		1 March 2014
Term of agreement:		Ongoing
Details:		Mr Dhanik receives an remuneration package including salary and pension of AUD$249,785 (USD$175,000) per annum. Payment of a benefit on early termination by the Group without cause is equal to 2 months’ base salary.

Notice period - 6 months

Name:		Denys Kravchenko
Title:		Chief Technology Officer (AdCel)
Agreement commenced:		27 July 2018
Term of agreement:		Ongoing
Details:		Mr Kravchenko receives an remuneration package including salary and pension of AUD$256,922 (USD$180,000) per annum. Payment of a benefit on early termination by the Group without cause is equal to 2 months’ base salary.

		Notice period - 6 months

Key management personnel have no entitlement to termination payments in the event of removal for misconduct.

Compensation of Director and Executive Officers Remuneration report (audited)

The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance with the requirements of the Corporations Act 2001 and its Regulations.

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including all directors.

The remuneration report is set out under the following main headings:

●	Principles used to determine the nature and amount of remuneration
●	Details of remuneration
●	Service agreements
●	Share-based compensation
●	Additional information
●	Additional disclosures relating to key management personnel

Principles used to determine the nature and amount of remuneration

The objective of the Group’s executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board of Directors (‘the Board’) ensures that executive reward satisfies the following key criteria for good reward governance practices:

●	competitiveness and reasonableness
●	acceptability to shareholders
●	performance linkage / alignment of executive compensation
●	Transparency

The Board is responsible for determining and reviewing remuneration arrangements for its directors and executives. The performance of the Group depends on the quality of its directors and executives. The remuneration philosophy is to attract, motivate and retain high performance and high quality personnel.

The Board has structured an executive remuneration framework that is market competitive and complementary to the reward strategy of the Group.

The reward framework is designed to align executive reward to shareholders’ interests. The Board has considered that it should seek to enhance shareholders’ interests by:

●	having net profit as a core component of plan design
●	focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price, and delivering constant or increasing return on assets as well as focusing the executive on key non-financial drivers of value
●	attracting and retaining high calibre executives

Additionally, the reward framework should seek to enhance executives’ interests by:

●	rewarding capability and experience
●	reflecting competitive reward for contribution to growth in shareholder wealth
●	providing a clear structure for earning rewards

In accordance with best practice corporate governance, the structure of non-executive director and executive director remuneration is separate.

Non-executive directors remuneration

Fees and payments to non-executive directors reflect the demands and responsibilities of their role. Non-executive directors’ fees and payments are reviewed annually by the Board. The Board may, from time to time, receive advice from independent remuneration consultants to ensure non-executive directors’ fees and payments are appropriate and in line with the market.

Executive remuneration

The Group aims to reward executives based on their position and responsibility, with a level and mix of remuneration which has both fixed and variable components.

The executive remuneration and reward framework has four components:

●	base pay and non-monetary benefits
●	short-term performance incentives
●	share-based payments
●	other remuneration such as superannuation and long service leave The combination of these comprises the executive’s total remuneration.

Fixed remuneration, consisting of base salary and non-monetary benefits, is reviewed annually by the Board based on individual and business unit performance, the overall performance of the Group and comparable market remunerations.

Executives may receive their fixed remuneration in the form of cash or other fringe benefits where it does not create any additional costs to the consolidated entity and provides additional value to the executive.

The short-term incentives (‘STI’) program is designed to align the targets of the business units with the performance hurdles of executives. STI payments are granted to executives based on specific annual targets and key performance indicators (‘KPI’s’) being achieved. KPI’s include profit contribution, customer satisfaction, leadership contribution and product management.

In prior year, share based payments (in Engage BDR LLC) had been issued to executives and a non-executive director, which were prior to the IPO. These were issued in respect of services performed for the Group. Refer to Note 30 of the financial report contained within this Registration statement for further details. All Directors and key management personnel did not receive any share based payments in 2018 financial year.

Details of remuneration

The key management personnel of the Group consisted of the following directors and key management personnel:

●	Ted Dhanik (Executive Chairman and Chief Executive Officer)
●	Kurtis Rintala (Executive Director and Chief Operating Officer)
●	Tom Anderson (Non-Executive Director)
●	Darian Pizem (Non-Executive Director)
●	Robert Antulov (Non-Executive Director)
●	Youqi Li (Chief Technology Officer)
●	Andy Dhanik (Chief Revenue Officer)
●	Denys Kravchenko (Chief Technology Officer - AdCel)

Amounts of remuneration

Details of the remuneration of key management personnel of the Group are set out in the following tables.

	Short-term benefits						Post- employment		Share-
	Cash salary and fees		Commission /bonus (a)		Non-monetary		benefits Defined- contribution plan		based Payments Equity-settled		Total
2020	$		$		$		$		$		$

Non-Executive Directors:
Tom Anderson		61,998		-		-		-		32,920		94,918
Robert Antulov		40,000		-		-		-		32,920		72,920
Darian Pizem		40,767		-		-		-		32,920		73,687

Executive Directors:
Ted Dhanik (a) (c)		477,188		400,000		93,041		-		754,000		1,724,229
Kurtis Rintala (c)		339,815		-		1,070		-		221,640		562,525

Other Key Management Personnel:
Youqi Li (c)		253,054		-		535		-		104,000		357,589
Andy Dhanik (b)		274,494		98,545		-		-		160,000		533,039
Denys Kravchenko (c)		260,284		-		-		-		184,000		444,284
		1,747,600		498,545		94,646		-		1,522,400		3,863,191

(a)	Bonus award of $400,000 to Mr. Ted Dhanik was made for 2020. This bonus was an offset against part of loan accounts. Loan items were special exertions from the board to compensate the Executives for significantly reduced payroll in 2011 and 2013 and applied to outstanding loan balances with no cash paid.

(b)	Commissions are earned by Mr. Andy Dhanik based on performance to goal. Generally, these performance goals are driven by sales targets and gross profit maximization. Sales and gross margin targets are based on forecasts. Actual performance to goal is compared to arrive at an “Achieved” percentage which is used to determine which Tier of payout they will receive. < 50% is given a 0% payout tier, 51-69% is given a 50% payout tier, 70-79% is given a 70% payout tier, 80-89% is given a 80% payout tier, 90-99% is given a 90% payout tier, and 100% is given a 100% payout tier. The payout tier is then multiplied by the result of dividing the maximum payout amount by the target to arrive at a “Payout Percentage”. The payout percentage is then multiplied by the actual achieved result to arrive at the dollar amount of the payout.
(c)	During the year 2020 payroll expenses were recognised as software capitalisation. These costs were related to the developmental costs to projects to deliver future economic benefit to the Group. For T. Dhanik and K. Rintala costs of US$172,735 (AU$224,273) each were capitalised. For Y.Li US$147,116 (AU$191,010) was capitalised. For D.Kravchenko a total of US$143,814 (AU$186,723) was capitalised.

	Short-term benefits						Post- employment		Share-
	Cash salary and fees		Commission /bonus (a)		Non-monetary		benefits Defined- contribution plan		based Payments Equity-settled		Total
2019	$		$		$		$		$		$

Non-Executive Directors:		64,015		-		-		-		-		64,015
Tom Anderson								-		-
Robert Antulov		40,000		-		-		-		-		40,000
Darian Pizem		58,599		-		-		-		-		58,599

Executive Directors:
Ted Dhanik (a)		337,789		340,664		-		-		-		678,453
Kurtis Rintala		337,789		-		-		-		-		337,789

Other Key Management Personnel:
Youqi Li		241,483		-		-		-		87,228		328,711
Andy Dhanik (b)		251,545		-		-		-		150,243		401,788
Denys Kravchenko		264,775		-		-		-		43,614		308,389
		1,595,995		340,664		-		-		281,085		2,217,744

(a)

Bonus award of $340,664 to Mr. Ted Dhanik was made for 2019. This bonus was an offset against part of loan accounts. Loan items were special exertions from the board to compensate the Executives for significantly reduced payroll in 2011 and 2013 and applied to outstanding loan balances with no cash paid.

(b)

Commissions are earned by Mr. Andy Dhanik based on performance to goal. Generally, these performance goals are driven by sales targets and gross profit maximization. Sales and gross margin targets are based on forecasts. Actual performance to goal is compared to arrive at an “Achieved” percentage which is used to determine which Tier of payout they will receive. < 50% is given a 0% payout tier, 51-69% is given a 50% payout tier, 70-79% is given a 70% payout tier, 80-89% is given a 80% payout tier, 90-99% is given a 90% payout tier, and 100% is given a 100% payout tier. The payout tier is then multiplied by the result of dividing the maximum payout amount by the target to arrive at a “Payout Percentage”. The payout percentage is then multiplied by the actual achieved result to arrive at the dollar amount of the payout.

Share-based compensation

Issue of shares

Details of shares issued to directors and other key management personnel as part of compensation during the year ended 31 December 2020 are set out below:

Name	Date	Shares		Deemed Issue price		$AUD

Ted Dhanik	27 April 2020		40,000,000	$	0.0160		640,000
Kurtis Rintala	27 April 2020		11,000,000	$	0.0160		176,000
Youqi Li	27 April 2020		6,500,000	$	0.0160		104,000
Andy Dhanik	27 April 2020		10,000,000	$	0.0160		160,000

Details of shares issued to directors and other key management personnel as part of compensation during the year ended 31 December 2019 are set out below:

Name	Date	Shares		Deemed Issue price		$AUD

Youqi Li	7 May 2019		681,857	$	0.042		28,638
Youqi Li	9 August 2019		868,244	$	0.034		29,520
Youqi Li	20 December 2019		1,321,353	$	0.022		29,070
Andy Dhanik	19 March 2019		680,072	$	0.031		21,082
Andy Dhanik	8 April 2019		449,886	$	0.047		21,145
Andy Dhanik	18 April 2019		426,354	$	0.049		20,891
Andy Dhanik	7 May 2019		511,393	$	0.042		21,479
Andy Dhanik	10 July 2019		335,970	$	0.043		14,447
Andy Dhanik	9 August 2019		651,183	$	0.034		22,140
Andy Dhanik	20 December 2019		1,321,353	$	0.022		29,070
Denys Kravchenko	7 May 2019		340,929	$	0.042		14,319
Denys Kravchenko	9 August 2019		434,122	$	0.034		14,760
Denys Kravchenko	20 December 2019		660,673	$	0.022		14,535

Options

The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and other key management personnel in the year ended 31 December 2020 are set out below:

Name	Number of options granted		Grant date	Vesting date and exercisable date	Expiry date	Exercise Price		Fair Value per option at grant date

Tom Anderson		1,900,000	18-Mar-20	18-Mar-20	01-Apr-23	$	0.0201	$	0.0077
Tom Anderson		1,900,000	18-Mar-20	18-Mar-21	01-Apr-23	$	0.0217	$	0.0080
Tom Anderson		1,900,000	18-Mar-20	18-Mar-22	01-Apr-23	$	0.0233	$	0.0084
Robert Antulov		1,900,000	18-Mar-20	18-Mar-20	01-Apr-23	$	0.0201	$	0.0077
Robert Antulov		1,900,000	18-Mar-20	18-Mar-21	01-Apr-23	$	0.0217	$	0.0080
Robert Antulov		1,900,000	18-Mar-20	18-Mar-22	01-Apr-23	$	0.0233	$	0.0084
Darian Pizem		1,900,000	18-Mar-20	18-Mar-20	01-Apr-23	$	0.0201	$	0.0077
Darian Pizem		1,900,000	18-Mar-20	18-Mar-21	01-Apr-23	$	0.0217	$	0.0080
Darian Pizem		1,900,000	18-Mar-20	18-Mar-22	01-Apr-23	$	0.0233	$	0.0084

The options listed above with the vesting date of 18 March 2020 vested immediately upon issue.

The options listed above with vesting dates of 18 March 2021 and 18 March 2022 remain unvested at the date of this report and will vest provided that the respective option holders meet service conditions.

Options granted carry no dividend or voting rights.

There were no options over ordinary shares granted to or vested by directors and other key management personnel as part of compensation during the year ended 31 December 2019.

There were no options over ordinary shares granted to or vested by directors and other key management personnel as part of compensation during the year ended 31 December 2018.

Additional information

The earnings of the consolidated entity for the five years to 31 December 2020 are summarised below:

	2020		2019		2018		2017		2016*
	$		$		$		$		$
Sales revenue	15,398,413		17,079,118		11,443,935		13,135,970		21,845,216
*Operating profit/(loss)*	(1,396,924	)	1,604,732		(6,286,229	)	(7,098,066	)	(1,455,961	)
Loss before income tax expense	(6,881,027	)	(1,343,429	)	(10,839,127	)	(9,583,419	)	(2,927,728	)
Loss after income tax expense	(6,881,027	)	(1,343,429	)	(10,840,198	)	(10,566,001	)	(3,671,811	)

*	The financial result represents engage:BDR LLC’s operating result for the year.

Additional disclosures relating to key management personnel

Shareholding

The number of shares in the company held during the financial year by each director and other members of key management personnel of the consolidated entity, including their personally related parties, is set out below:

2020

	Balance at the start of the year		Received as part of remuneration		Additions		Disposals		Balance at the end of the year
Ordinary shares
Ted Dhanik		57,681,498		40,000,000		-		-		97,681,498
Kurtis Rintala		36,717,391		11,000,000		-		-		47,717,391
Tom Anderson		1,500,000		-		-		-		1,500,000
Robert Antulov		665,500		-		-		-		665,500
Youqi Li		4,371,454		6,500,000		-		-		10,871,454
Andy Dhanik		3,196,211		10,000,000		-		-		13,196,211
Denys Kravchenko		1,435,727		-		-		-		1,435,727
		105,567,781		67,500,000		-		-		173,067,781

Loans to key management personnel and their related parties

As at 31 December 2020 the Group recognised a loan receivable for funds payable by Mr Ted Dhanik (USD$1,035,277; AUD$1,344,166) (2019: USD$1,191,163; AUD$1,700,204) and Mr Andy Dhanik (USD$65,277; AUD$93,173) (2019: USD$65,277; AUD$93,173).

From 1 July 2019, Loans to directors and key management personnel were charged interest at a simple interest rate of 5% per annum, calculated monthly. This interest rate is consistent with local interest rates charged for secured personal debt. For the year ended 31 December 2020, loans given to Mr Ted Dhanik and Mr Andy Dhanik accrued an interest of AUD$89,666 and AUD$4,720 respectively. The loans made to both directors and key management personnel are repayable by 31 August 2021. These have been disclosed as current receivables. $1,984,869 outstanding loans are secured against each individuals’ shareholding and will be settled in cash. All loans were approved by the Board of Directors of the Group.

This concludes the remuneration report, which has been audited.

Shares under option

Unissued ordinary shares of the Company under option at the date of this report are as follows:

Grant date	Expiry date	Exercise price		Number under option

29 January 2019	26 January 2022	$	0.0520		8,676,093
25 September 2019	30 September 2022	$	0.0260		13,750,000
18 March 2020	01 April 2023	$	0.0201		5,700,000
18 March 2020	01 April 2023	$	0.0217		5,700,000
18 March 2020	01 April 2023	$	0.0233		5,700,000
					39,526,093

No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of the Company or of any other body corporate.

Shares issued on the exercise of options

There were no ordinary shares of engage:BDR Limited issued on the exercise of options during the year ended 31 December 2020 and up to the date of this report.

Indemnity and insurance of officers

During the financial year, the Group maintained an insurance policy which indemnifies the directors and officers of the Group in respect of any liability incurred in connection with the performance of their duties as directors or officers of the Group to the extent permitted by the Corporations Act 2001. The Group’s insurers have prohibited disclosure of the amount of the premium payable and the level of indemnification under the insurance contract.

The Group has not paid any insurance premiums in respect of any past or present directors or auditors, other than as required by law.

C. Board practices

Meetings of directors

The number of meetings of the company’s Board of Directors (‘the Board’) held during the year ended 31 December 2020, and the number of meetings attended by each director were:

	Full Board
	Attended		Held

Ted Dhanik		10		10
Kurtis Rintala		10		10
Tom Anderson		5		10
Darian Pizem		10		10
Robert Antulov		10		10

Held: represents the number of meetings held during the time the director held office.

D. Employees

Our employee information is set forth below.

2018-34 Employees

Accounting Dept-6 employees

Sales & Mktg-14 employees

Technology-8 employees

Operations-3 employees

Executive-2 employees

Ad Operations-1 employee

2019-22 Employees

Accounting Dept-5 employees

Sales & Mktg-6 employees

Technology-7 employees

Operations-1 employees

Executive-2 employees

Ad Operations-1 employee

2020-19 Employees

Accounting Dept-3 employees

Sales & Mktg-6 employees

Technology-6 employees

Operations-1 employees

Executive-2 employees

Ad Operations-1 employee

All employees are located in the USA.

Change in number of employees is due to workforce optimization and COVID-19.

No labor unions and we do not employee temporary employees. Our employee relations are deemed good.

E. Share ownership

Additional disclosures relating to key management personnel

Shareholding

2019

	Balance at the start of the year		Received as part of remuneration		Additions		Disposals			Balance at the end of the year
Ordinary shares
Ted Dhanik		55,949,870		-		-		-			55,949,870
Kurtis Rintala		35,217,391		-		-		-			35,217,391
Tom Anderson		1,500,000		-		-		-			1,500,000
Robert Antulov		665,500		-		-		-			665,500
Youqi Li		1,500,000		2,871,454		-		-			4,371,454
Andy Dhanik		3,000,000		4,376,211		-		(4,180,000	)		3,196,211
Denys Kravchenko		2,885,904		1,435,727		-		(2,885,904	)		1,435,727
		100,718,665		8,683,392		-		(7,065,904	)		102,336,153

Loans to key management personnel and their related parties

As at 31 December 2019 the Group recognised a loan receivable for funds payable by Mr Ted Dhanik (USD$1,191,163; AUD$1,700,204) (2018: USD$1,313,754; AUD$1,864,598) and Mr Andy Dhanik (USD$65,277; AUD$93,173) (2018: USD$71,060; AUD$100,855).

From 1 July 2019, Loans to directors and key management personnel were charged interest at a simple interest rate of 5% per annum, calculated monthly. This interest rate is consistent with local interest rates charged for secured personal debt. For the year ended 31 December 2019, loans given to Mr Ted Dhanik and Mr Andy Dhanik accrued an interest of AUD$35,708 and AUD$1,815 respectively. The loans made to both directors and key management personnel are repayable by 31 August 2020. These have been disclosed as current receivables. $1,267,785 outstanding loans are secured against each individuals’ shareholding and will be settled in cash. All loans were approved by the Board of Directors of the Group.

The following table sets forth information with respect to the beneficial ownership of our ordinary shares as of November 10, 2020 for:

	●	each beneficial owner of 5% or more of our outstanding ordinary shares;

	●	each of our directors and executive officers; and

	●	all of our directors and executive officers as a group.

Beneficial ownership is determined in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities and include ordinary shares issuable upon the exercise of options that are immediately exercisable or exercisable within 60 days of the date of this registration statement. Percentage ownership calculations are based on ordinary shares outstanding as November , 2020.

Except as otherwise indicated, all of the shares reflected in the table are ordinary shares and all persons listed below have sole voting and investment power with respect to the shares beneficially owned by them, subject to applicable community property laws. The information is not necessarily indicative of beneficial ownership for any other purpose.

Except as otherwise indicated in the table below, addresses of our directors, executive officers and named beneficial owners are in care of Engage BDR, at our corporate offices.

Name of Beneficial Owner		Number of Shares Beneficially Owned		Percentage of Shares Beneficially Owned
5% or Greater Shareholders:	First Round Capital LLC (1)		97,681,498		5.67

Directors and Executive Officers:
	Ted Dhanik		97,681,498		5.67
	Kurtis Rintala		47,717,391		2.77
	Andy Dhanik		11,896,211		0.69
	Youqi Li		10,871,454		0.63
	Tom Anderson		1,500,000		0.09
	Denys Kravchenko		1,435,727		0.08
	Robert Antulov		665,500		0.04
All current directors and executive officers as a group (8 persons)

*	Less than 1%

Ted Dhanik controls First Round Capital LLC Ted Dhanik owns 100% Address: 415 N. Benton Ave MT 59601; total shares 97,681,498

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A. MAJOR SHAREHOLDERS

Please refer to Item 6.E. “Directors, Senior Management and Employees—Share Ownership.”

As of December 31, 2020, there were 2,370,744,548 ordinary shares issued and outstanding, AU$0.0060 per ordinary share.

As of December 31, 2019, there were 712,394,973 ordinary shares issued and outstanding, AU$0.022 per ordinary share.

B. Related Party Transactions

During the last three years, we have engaged in the following transactions with our directors, executive officers or holders of more than 5% of our outstanding share capital and their affiliates, which we refer to as our related parties:

Additional disclosures relating to key management personnel

Shareholding

2020

	Balance at the start of the year		Received as part of remuneration		Additions		Disposals		Balance at the end of the year
Ordinary shares
Ted Dhanik		57,681,498		40,000,000		-		-		97,681,498
Kurtis Rintala		47,717,391		11,000,000		-		-		47,717,391
Tom Anderson		1,500,000		-		-		-		1,500,000
Robert Antulov		665,500		-		-		-		665,500
Youqi Li		4,371,454		6,500,000		-		-		10,871,454
Andy Dhanik		3,196,211		10,000,000		-		-		13,196,211
Denys Kravchenko		1,435,727		-		-		-		1,435,727
		105,567,781		67,500,000		-		-		173,067,781

2019

	Balance at the start of the year		Received as part of remuneration		Additions		Disposals			Balance at the end of the year
Ordinary shares
Ted Dhanik		55,949,870		-		-		-			55,949,870
Kurtis Rintala		35,217,391		-		-		-			35,217,391
Tom Anderson		1,500,000		-		-		-			1,500,000
Robert Antulov		665,500		-		-		-			665,500
Youqi Li		1,500,000		2,871,454		-		-			4,371,454
Andy Dhanik		3,000,000		4,376,211		-		(4,180,000	)		3,196,211
Denys Kravchenko		2,885,904		1,435,727		-		(2,885,904	)		1,435,727
		100,718,665		8,683,392		-		(7,065,904	)		102,336,153

2018

	Balance at the start of the year		Received as part of remuneration		Additions		Disposals			Balance at the end of the year
Ordinary shares
Ted Dhanik		55,949,870		-		-		-			55,949,870
Kurtis Rintala		35,217,391		-		-		-			35,217,391
Tom Anderson		1,500,000		-		-		-			1,500,000
Robert Antulov		-		-		665,500		-			665,500
Bruce McMenamin		25,000				78,125		(103,125	)		-
Ron Phillips		40,000				37,500		(77,500	)		-
Kevin Kwok		6,450,000						(6,450,000	)		-
Youqi Li		1,500,000		-		-		(1,500,000	)		-
Sarah Wetzel		1,125,000						(1,125,000	)		-
Andy Dhanik		3,000,000		-		-		-			3,000,000
Mona Jalali		1,500,000		-		-		(1,500,000	)		-
		106,307,261		-		781,125-		(10,755,625	)		96,332,761

Loans to key management personnel and their related parties

From 1 July 2019, Loans to directors and key management personnel were charged interest at a simple interest rate of 5% per annum, calculated monthly. This interest rate is consistent with local interest rates charged for secured personal debt. For the year ended 31 December 2019, loans given to Mr Ted Dhanik and Mr Andy Dhanik accrued an interest of AUD$35,708 and AUD$1,815 respectively. The loans made to both directors and key management personnel are repayable by 31 August 2020. These have been disclosed as current receivables. $1,267,785 outstanding loans are secured against each individuals’ shareholding and will be settled in cash. All loans were approved by the Board of Directors of the Group.

Loans to/from related parties

The following balances are outstanding at the reporting date in relation to loans with related parties:

2020

	Consolidated
	2020			2019
	$			$
Beginning of the year		2,311,510			2,229,032
Loans advanced		197,603			337,503
Bonus awarded to key management personnel offset against loan balances		(400,000	)		(337,127	)
Interest charged		101,200			78,285
Exchange difference		(225,444)			3,817
		1,984,869			2,311,510

	Consolidated
	2019			2018
	$			$
Beginning of the year		2,229,032			2,277,582
Loans advanced		337,503			329,432
Bonus awarded to key management personnel offset against loan balances		(337,127	)		(672,582	)
Interest charged		78,285			63,025
Exchange difference		3,817			231,575
		2,311,510			2,229,032

Terms and conditions

From 1 July 2019, Loans to directors and key management personnel were charged interest at a simple interest rate of 5% per annum, calculated monthly. This interest rate is consistent with local interest rates charged for secured personal debt. The loans made to both directors and key management personnel are repayable by 31 August 2020. These have been disclosed as current receivables. $1,267,785 outstanding loans are secured against each individuals’ shareholding and will be settled in cash. All loans were approved by the Board of Directors of the Group.

Policies and Procedures for Related Party Transactions

Our board of directors has created an audit committee which is tasked with review and approval of all related party transactions.

Employment Agreements, Director Agreements and Indemnification Agreements

See above in this registration statement.

C. Interests of Experts and Counsel

Not applicable.

ITEM 8. FINANCIAL INFORMATION

A. Consolidated Statements and Other Financial Information

See “Item 18. Financial Statements” for our audited consolidated financial statements filed as part of this registration statement.

A.7 Legal Proceedings

We are not currently a party to any legal or arbitration proceedings, including those relating to bankruptcy, receivership or similar proceedings and those involving any third party, nor any governmental proceedings pending or known to be contemplated, that in the opinion of our management would have a material adverse effect on our business or that may have, or have had in the recent past, significant effects on our financial position or profitability. However, from time to time, we may be involved in legal proceedings or be subject to claims arising out of our operations. Amounts accrued, as well as the total amount of reasonably possible losses with respect to such matters, individually and in the aggregate, are not deemed to be material to the consolidated financial statements.

A.8 Dividend Policy

Engage BDR has never declared or paid a dividend, and we do not anticipate declaring or paying dividends in the foreseeable future. We intend to retain all available funds and any future earnings to fund the development and expansion of our business.

B. Significant Changes

We have not experienced any significant changes since the date of our audited consolidated financial statements included in this registration statement.

ITEM 9. THE OFFER AND LISTING

A. Offering and Listing Details

Our ordinary shares are to be subject to an application listed on the Nasdaq Capital Market under the symbol “_____”. Prior to that date, there was no public trading market for our ordinary shares in the U.S.

B. Plan of Distribution

Not applicable.

C. Markets

Our ordinary shares have been listed on since under the symbol.

D. Selling Shareholders

Not applicable.

E. Dilution

Not applicable.

F. Expenses of the Issue

Not applicable.

ITEM 10. ADDITIONAL INFORMATION

A. Share Capital

Not applicable.

B. Memorandum and Articles of Association

Please see the EN1 Constitution (Exhibit 1.1).

The company must hold an annual general meeting (AGM) at least once in a calendar year and within 5 months after the end of the financial year. The business of the AGM is to consider the annual financial report, election of directors, appointment of the auditor, and etc. The annual financial report, directors’ report, and auditor’s report must be laid before the AGM.

Ordinary Shares

All of our outstanding ordinary shares are fully paid and non-assessable.

Issuance of Shares and Changes to Capital

Our board of directors has general and unconditional authority to allot, grant options over, offer or otherwise deal with or dispose of any unissued shares in our capital without the approval of our shareholders (whether forming part of the original or any increased share capital), either at a premium or at par, with or without preferred, deferred or other special rights or restrictions, whether in regard to dividend, voting, return of capital or otherwise and to such persons, on such terms and conditions, and at such times as the directors may decide, but so that no share shall be issued at a discount, except in accordance with the provisions of the Australian Companies Law. We will not issue bearer shares.

We may, subject to the provisions of the Australian Companies Law, our amended and restated memorandum and articles of association, the SEC and Nasdaq, from time to time by shareholders resolution passed by a simple majority of the voting rights entitled to vote at a general meeting: increase our capital by such sum, to be divided into shares of such amounts, as the relevant resolution shall prescribe; consolidate and divide all or any of our share capital into shares of larger amount than our existing shares; convert all or any of its paid up shares into stock and reconvert that stock into paid up shares of any denomination; sub-divide our existing shares, or any of them, into shares of smaller amounts than is fixed pursuant to our amended and restated memorandum and articles of association; and cancel any shares which at the date of the passing of the resolution have not been taken or agreed to be taken by any person, and diminish the amount of our share capital by the amount of the shares so cancelled.

We may also, subject to the provisions of the Australian Companies Law, our amended and restated memorandum and articles of association, the SEC and Nasdaq: issue shares on terms that they are to be redeemed or are liable to be redeemed; purchase our own shares (including any redeemable shares); and make a payment in respect of the redemption or purchase of our own shares in any manner authorized by the Companies Law, including out of our capital.

Dividends

Directors may pay dividends as they see fit.

Voting and Meetings

Each member has one vote. A resolution put to the vote at a meeting of the members must be decided on a show of hands unless a poll is demanded.

Transfers of Shares

A member wishing to sell any shares must give notice to company secretary containing an irrevocable offer to sell and stating the number and class of shares which the member wishes to sell and the price which the member is willing to accept for them.

Liquidation

If the company is wound up, the liquidator may, with the sanction of a special resolution, divide among the members in kind the whole or any part of the property of the company and may for that purpose set such value as the liquidator considers fair upon any property to be so divided and may determine how the division is to be carried out as between the members or different classes of members.

Inspection of Books and Records

A director is entitled to inspect the records of the company at all reasonable times. A member other than a director does not have the right to inspect any company document except as provided by the Constitution, by law or authorized by the directors or by the company in general meeting.

Register of Shareholders

The company must keep a register of members.

Preferred Shares

Our board of directors is empowered to designate and issue from time to time one or more classes or series of preferred shares and to fix and determine the relative rights, preferences, designations, qualifications, privileges, options, conversion rights, limitations and other special or relative rights of each such class or series so authorized. Such action could adversely affect the voting power and other rights of the holders of our ordinary shares or could have the effect of discouraging any attempt by a person or group to obtain control of us.

C. Material Contracts

We have not entered into any material contracts other than in the ordinary course of business and other than those described in “Item 4. Information on the Company” or elsewhere in this registration statement on Form 20-F.

D. Exchange Controls

None.

E. Taxation

Passive Foreign Investment Company Consequences

In general, a corporation organized outside the United States will be treated as a PFIC for any taxable year in which either (1) at least 75% of its gross income is “passive income” (the “PFIC income test”), or (2) on average at least 50% of its assets, determined on a quarterly basis, are assets that produce passive income or are held for the production of passive income (the “PFIC asset test”). Passive income for this purpose generally includes, among other things, dividends, interest, royalties, rents, and gains from the sale or exchange of property that gives rise to passive income. Assets that produce or are held for the production of passive income generally include cash, even if held as working capital or raised in a public offering, marketable securities, and other assets that may produce passive income. Generally, in determining whether a non-U.S. corporation is a PFIC, a proportionate share of the income and assets of each corporation in which it owns, directly or indirectly, at least a 25% interest (by value) is taken into account.

Although PFIC status is determined on an annual basis and generally cannot be determined until the end of a taxable year, based on the nature of our current and expected income and the current and expected value and composition of our assets, we do not presently expect to be a PFIC for our current taxable year or the foreseeable future. However, there can be no assurance given in this regard because the determination of whether we are or will become a PFIC is a fact-intensive inquiry made on an annual basis that depends, in part, upon the composition of our income and assets. In addition, there can be no assurance that the IRS will agree with our conclusion or that the IRS would not successfully challenge our position.

If we are a PFIC in any taxable year during which a U.S. Holder owns our ordinary shares, the U.S. Holder could be liable for additional taxes and interest charges under the “PFIC excess distribution regime” upon (1) a distribution paid during a taxable year that is greater than 125% of the average annual distributions paid in the three preceding taxable years, or, if shorter, the U.S. Holder’s holding period for our ordinary shares, and (2) any gain recognized on a sale, exchange or other disposition, including a pledge, of our ordinary shares, whether or not we continue to be a PFIC. Under the PFIC excess distribution regime, the tax on such distribution or gain would be determined by allocating the distribution or gain ratably over the U.S. Holder’s holding period for our ordinary shares. The amount allocated to the current taxable year (i.e., the year in which the distribution occurs or the gain is recognized) and any year prior to the first taxable year in which we are a PFIC will be taxed as ordinary income earned in the current taxable year. The amount allocated to other taxable years will be taxed at the highest marginal rates in effect for individuals or corporations, as applicable, to ordinary income for each such taxable year, and an interest charge, generally applicable to underpayments of tax, will be added to the tax.

If we are a PFIC for any year during which a U.S. Holder holds our ordinary shares, we must generally continue to be treated as a PFIC by that holder for all succeeding years during which the U.S. Holder holds such ordinary shares, unless we cease to meet the requirements for PFIC status and the U.S. Holder makes a “deemed sale” election with respect to our ordinary shares. If the election is made, the U.S. Holder will be deemed to sell our ordinary shares it holds at their fair market value on the last day of the last taxable year in which we qualified as a PFIC, and any gain recognized from such deemed sale would be taxed under the PFIC excess distribution regime. After the deemed sale election, the U.S. Holder’s ordinary shares would not be treated as shares of a PFIC unless we subsequently become a PFIC.

If we are a PFIC for any taxable year during which a U.S. Holder holds our ordinary shares and one of our non-United States subsidiaries is also a PFIC (i.e., a lower-tier PFIC), such U.S. Holder would be treated as owning a proportionate amount (by value) of the shares of the lower-tier PFIC and would be taxed under the PFIC excess distribution regime on distributions by the lower-tier PFIC and on gain from the disposition of shares of the lower-tier PFIC even though such U.S. Holder would not receive the proceeds of those distributions or dispositions. Any of our non-United States subsidiaries that have elected to be disregarded as entities separate from us or as partnerships for U.S. federal income tax purposes would not be corporations under U.S. federal income tax law and accordingly, cannot be classified as lower-tier PFICs. However, non-United States subsidiaries that have not made the election may be classified as a lower-tier PFIC if we are a PFIC during your holding period and the subsidiary meets the PFIC income test or PFIC asset test. Each U.S. Holder is advised to consult its tax advisors regarding the application of the PFIC rules to any of our non-United States subsidiaries.

If we are a PFIC, a U.S. Holder will not be subject to tax under the PFIC excess distribution regime on distributions or gain recognized on our ordinary shares if a valid “mark-to-market” election is made by the U.S. Holder for our ordinary shares. An electing U.S. Holder generally would take into account as ordinary income each year, the excess of the fair market value of our ordinary shares held at the end of such taxable year over the adjusted tax basis of such ordinary shares. The U.S. Holder would also take into account, as an ordinary loss each year, the excess of the adjusted tax basis of such ordinary shares over their fair market value at the end of the taxable year, but only to the extent of the excess of amounts previously included in income over ordinary losses deducted as a result of the mark-to-market election. The U.S. Holder’s tax basis in our ordinary shares would be adjusted to reflect any income or loss recognized as a result of the mark-to-market election. Any gain from a sale, exchange or other disposition of our ordinary shares in any taxable year in which we are a PFIC would be treated as ordinary income and any loss from such sale, exchange or other disposition would be treated first as ordinary loss (to the extent of any net mark-to-market gains previously included in income) and thereafter as capital loss. If, after having been a PFIC for a taxable year, we cease to be classified as a PFIC because we no longer meet the PFIC income or PFIC asset test, the U.S. Holder would not be required to take into account any latent gain or loss in the manner described above and any gain or loss recognized on the sale or exchange of the ordinary shares would be classified as a capital gain or loss.

A mark-to-market election is available to a U.S. Holder only for “marketable stock.” Generally, stock will be considered marketable stock if it is “regularly traded” on a “qualified exchange” within the meaning of applicable U.S. Treasury regulations. A class of stock is regularly traded during any calendar year during which such class of stock is traded, other than in de minimis quantities, on at least 15 days during each calendar quarter.

Our ordinary shares are marketable stock as long as they remain listed on the Nasdaq Capital Market and are regularly traded. A mark- to-market election will not apply to the ordinary shares for any taxable year during which we are not a PFIC, but will remain in effect with respect to any subsequent taxable year in which we become a PFIC. Such election will not apply to any of our non-U.S. subsidiaries. Accordingly, a U.S. Holder may continue to be subject to tax under the PFIC excess distribution regime with respect to any lower-tier PFICs notwithstanding the U.S. Holder’s mark-to-market election for the ordinary shares.

Except for stamp duties which may be applicable on instruments executed in or brought within the jurisdiction of the Cayman Islands, no stamp duty, capital duty, registration or other issue or documentary taxes are payable in the Cayman Islands on the creation, issuance or delivery of the ordinary shares. The Cayman Islands currently have no form of income, corporate or capital gains tax and no estate duty, inheritance tax or gift tax. There are currently no Cayman Islands’ taxes or duties of any nature on gains realized on a sale, exchange, conversion, transfer or redemption of the ordinary shares. Payments of dividends and capital in respect of the ordinary shares will not be subject to taxation in the Cayman Islands and no withholding will be required on the payment of interest and principal or a dividend or capital to any holder of the ordinary shares, nor will gains derived from the disposal of the ordinary shares be subject to Cayman Islands income or corporation tax as the Cayman Islands currently have no form of income or corporation taxes.

The tax consequences that would apply if we are a PFIC would also be different from those described above if a U.S. Holder were able to make a valid qualified electing fund, or “QEF”, election. As we do not expect to provide U.S. Holders with the information necessary for a U.S. Holder to make a QEF election, prospective investors should assume that a QEF election will not be available.

The U.S. federal income tax rules relating to PFICs are very complex. U.S. Holders and prospective U.S. investors are strongly urged to consult their own tax advisors with respect to the impact of PFIC status on the purchase, ownership and disposition of our ordinary shares, the consequences to them of an investment in a PFIC, any elections available with respect to the ordinary shares and the IRS information reporting obligations with respect to the purchase, ownership and disposition of ordinary shares of a PFIC.

Distributions

Subject to the discussion above under “- Passive Foreign Investment Company Consequences,” a U.S. Holder that receives a distribution with respect to our ordinary shares generally will be required to include the gross amount of such distribution in gross income as a dividend when actually or constructively received to the extent of the U.S. Holder’s pro rata share of our current and/or accumulated earnings and profits (as determined under U.S. federal income tax principles). To the extent a distribution received by a U.S. Holder is not a dividend because it exceeds the U.S. Holder’s pro rata share of our current and accumulated earnings and profits, it will be treated first as a tax-free return of capital and reduce (but not below zero) the adjusted tax basis of the U.S. Holder’s ordinary shares. To the extent the distribution exceeds the adjusted tax basis of the U.S. Holder’s ordinary shares, the remainder will be taxed as capital gain. Because we may not account for our earnings and profits in accordance with U.S. federal income tax principles, U.S. Holders should expect all distributions to be reported to them as dividends.

Distributions on our ordinary shares that are treated as dividends generally will constitute income from sources outside the United States for foreign tax credit purposes and generally will constitute passive category income. Such dividends will not be eligible for the “dividends received’’ deduction generally allowed to corporate shareholders with respect to dividends received from U.S. corporations. Dividends paid by a “qualified foreign corporation’’ to certain non-corporate U.S. Holders may be are eligible for taxation at a reduced capital gains rate rather than the marginal tax rates generally applicable to ordinary income provided that a holding period requirement (more than 60 days of ownership, without protection from the risk of loss, during the 121-day period beginning 60 days before the ex- dividend date) and certain other requirements are met. Each U.S. Holder is advised to consult its tax advisors regarding the availability of the reduced tax rate on dividends to its particular circumstances. However, if we are a PFIC for the taxable year in which the dividend is paid or the preceding taxable year (see discussion above under “- Passive Foreign Investment Company Consequences’’), we will not be treated as a qualified foreign corporation, and therefore the reduced capital gains tax rate described above will not apply.

Dividends will be included in a U.S. Holder’s income on the date of the depositary’s receipt of the dividend. The amount of any dividend income paid in Cayman Islands dollars will be the U.S. dollar amount calculated by reference to the exchange rate in effect on the date of receipt, regardless of whether the payment is in fact converted into U.S. dollars. If the dividend is converted into U.S. dollars on the date of receipt, a U.S. Holder should not be required to recognize foreign currency gain or loss in respect to the dividend income. A U.S. Holder may have foreign currency gain or loss if the dividend is converted into U.S. dollars after the date of receipt.

A non-United States corporation (other than a corporation that is classified as a PFIC for the taxable year in which the dividend is paid or the preceding taxable year) generally will be considered to be a qualified foreign corporation with respect to any dividend it pays on ordinary shares that are readily tradable on an established securities market in the United States.

Information Reporting and Backup Withholding

U.S. Holders may be required to file certain U.S. information reporting returns with the IRS with respect to an investment in our ordinary shares, including, among others, IRS Form 8938 (Statement of Specified Foreign Financial Assets). As described above under “Passive Foreign Investment Company Consequences”, each U.S. Holder who is a shareholder of a PFIC must file an registration statement containing certain information. U.S. Holders paying more than $100,000 for our ordinary shares may be required to file IRS Form 926 (Return by a U.S. Transferor of Property to a Foreign Corporation) reporting this payment. Substantial penalties may be imposed upon a U.S. Holder that fails to comply with the required information reporting.

Dividends on and proceeds from the sale or other disposition of our ordinary shares may be reported to the IRS unless the U.S. Holder establishes a basis for exemption. Backup withholding may apply to amounts subject to reporting if the holder (1) fails to provide an accurate U.S. taxpayer identification number or otherwise establish a basis for exemption, or (2) is described in certain other categories of persons. However, U.S. Holders that are corporations generally are excluded from these information reporting and backup withholding tax rules.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules generally will be allowed as a refund or a credit against a U.S. Holder’s U.S. federal income tax liability if the required information is furnished by the U.S. Holder on a timely basis to the IRS.

U.S. Holders and prospective investors should consult their own tax advisors regarding the backup withholding tax and information reporting rules.

U.S. HOLDERS AND PROSPECTIVE INVESTORS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS ABOUT THE TAX CONSEQUENCES TO THEM OF AN INVESTMENT IN OUR ORDINARY SHARES IN LIGHT OF THEIR INDIVIDUAL CIRCUMSTANCES.

F. Dividends and Paying Agents

Not applicable.

G. Statement by Experts

Not applicable.

H. Documents on Display

As a “foreign private issuer,” we are subject to periodic reporting and other informational requirements of the Exchange Act that are applicable to foreign private issuers, and under those requirements file reports and other information with the SEC, including registration statements on Form 20-F and reports on Form 6-K. Specifically, we are required to file annually a Form 20-F no later than four months after the close of each fiscal year.

You may review a copy of the registration statement, including exhibits and any schedule filed therewith, and any other reports or other information, and obtain copies of such materials at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains a website at http://www.sec.gov that contains reports, proxy and information statements and other information regarding issuers, like us, that file electronically with the SEC.

We maintain a website at http://www.engagebdr.com. Information contained on, or that can be accessed through, our website is not a part of, and shall not be incorporated by reference into, this registration statement.

I. Subsidiary Information

		Ownership interest
Name	Principal place of business / Country of incorporation	2020 %			2019 %

engage:BDR LLC	United States of America		100	%		100	%
Tiveo LLC*	United States of America		100	%		100	%
AdCel LLC	United States of America		100	%		100	%

		Ownership interest
Name	Principal place of business / Country of incorporation	2019 %			2018 %

engage:BDR LLC	United States of America		100	%		100	%
Tiveo LLC*	United States of America		100	%		100	%
AdCel LLC	United States of America		100	%		100	%

*	Tiveo LLC is a wholly owned subsidiary of engage:BDR LLC.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

A. Debt Securities

Not applicable.

B. Warrants and Rights

Not applicable.

C. Other Securities

Not applicable.

D. American Depositary Shares

Not applicable.

PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

None.

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

Material Modifications to the Rights of Security Holders

See “Item 10. Additional Information—B. Memorandum and Articles of Association” for a description of the rights of securities holders, which remain unchanged.

Use of Proceeds

Not applicable.

ITEM 15. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our chief executive officer and our chief financial officer, we carried out an evaluation of the effectiveness of our disclosure controls and procedures, which is defined in Rules 13a-15(e) of the Exchange Act, as of the end of the period covered by this registration statement. Based upon that evaluation, our management, with the participation of our chief executive officer and chief financial officer, has concluded that, due to the material weaknesses and significant deficiencies described below under “Changes in Internal Control Over Financial Reporting”, as of the end of the period covered by this registration statement, our disclosure controls and procedures were not effective in ensuring that the information required to be disclosed by us in this registration statement is recorded, processed, summarized and reported to them for assessment, and required disclosure is made within the time period specified in the rules and forms of the SEC.

Management’s Registration statement on Internal Control over Financial Reporting and Attestation Report of Registered Public Accounting Firm

This registration statement does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of the Company’s independent registered public accounting firm due to a transition period established by rules of the Securities and Exchange Commission for newly public companies.

Changes in Internal Control Over Financial Reporting

None.

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

Our board of directors has determined that __________, an independent director, under the standards set forth under the Nasdaq Capital Market corporate governance requirements and Rule 10A-3 under the Exchange Act, and the chair of our audit committee, is an audit committee financial expert.

ITEM 16B. CODE OF ETHICS

We have adopted a Code of Business Conduct and Ethics applicable to all of our directors and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, which is a “code of ethics” as defined in Item 16B of Form 20-F promulgated by the SEC and as required by the Nasdaq rules. The full text of the Code of Business Conduct and Ethics is posted on our website at ___________________. Information contained on, or that can be accessed through, our website does not constitute a part of this registration statement and is not incorporated by reference herein. We will provide a copy of the Code of Business Conduct and Ethics without charge upon request by mail or by telephone. If we make any amendment to the Code of Business Conduct and Ethics or grant any waivers, including any implicit waiver, from a provision of the Code of Business Conduct and Ethics, we will disclose the nature of such amendment or waiver on our website to the extent required by the rules and regulations of the SEC.

ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table sets forth the aggregate fees by categories specified below in connection with certain professional services rendered by our principal external auditor, for the periods indicated.

	For the year ended
	December 31,
	2020		2019
Audit fees (1)	$	69,650	$	50,000
Audit-related fees (2)		-
Tax fees(3)		22,209		-

	For the year ended
	December 31,
	2019		2018
Audit fees (1)	$	50,000	$	70,000
Audit-related fees (2)		-
Tax fees(3)		-		-

(1)

“Audit fees” represents the aggregate fees billed for each of the fiscal years listed for professional services rendered by our principal accounting firm for the audit of our annual financial statements or services that are normally provided by the auditors in connection with statutory and regulatory filings or engagements.

(2)	“Audit-related fees” represents the aggregate fees billed for professional services rendered by our principal accounting firm for the assurance and related services, which mainly included the audit and review of financial statements and are not reported under “Audit Fees” above.

(3)	“Tax fees” represents the aggregate fees billed for professional services rendered by our principal accounting firm for tax compliance, tax advice and tax planning.

The policy of our audit committee is to pre-approve all audit and non-audit services including audit services, audit-related services, tax services and other services as described above.

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

Not applicable

ITEM 16F. CHANGE OF AUDITOR

Auditor appointed on January 20, 2020. The reasoning for a change of auditor was due to cost. The new audit firm is a reduction in cost by 28%. The change of cost was from AU$70,000 to AU$50,000. No disagreements. The previous firm was BDO who was appointed on January 29, 2019. Ernst and Young was the auditor beginning in 2016.

Engagement of the active auditor occurred in November of 2019. Audit team has audited the following periods ending on December 31, 2018, 2019 and 2020. The team in order to give audit report had to do 2018 for verification of opening balances and comparisons.

ITEM 16G. CORPORATE GOVERNANCE

As an Australian company seeking to be listed on the Nasdaq Capital Market, we are subject to the Nasdaq corporate governance listing standards. The Nasdaq rules permit a foreign private issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in Australia, which is our home country, may differ significantly from the Nasdaq corporate governance listing standards. Currently, we do not plan to rely on home country practice with respect to our corporate governance. However, if we choose to follow home country practice in the future, our shareholders may be afforded less protection than they otherwise would enjoy under the Nasdaq corporate governance listing standards applicable to U.S. domestic issuers.

ITEM 16H. MINE SAFETY DISCLOSURE

Not applicable.

PART III

ITEM 17. FINANCIAL STATEMENTS

We have elected to provide financial statements pursuant to Item 18.

These financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board ('IASB').

ITEM 18. FINANCIAL STATEMENTS

F-1

F-2

F-3

F-4

F-5

F-6

F-7

F-8

engage:BDR Limited

Appendix 4E

Preliminary final report

1. Company details

Name of entity:		engage:BDR Limited
ABN:		621 160 585
Reporting period:		For the year ended 31 December 2020
Previous period:		For the year ended 31 December 2019

2. Results for announcement to the market

					$

Revenues from ordinary activities	down	9.8	%	to		15,398,413

EBITDA/Operating profit/(loss)	down	187.0	%			(1,396,924	)

Loss from ordinary activities after tax attributable to the owners of engage:BDR Limited	up	412.2	%	to		(6,881,027	)

Loss for the year attributable to the owners of engage:BDR Limited	up	412.2	%	to		(6,881,027	)

Dividends

There were no dividends paid, recommended or declared during the current financial period.

Comments

The loss for the consolidated entity after providing for income tax amounted to $6,881,027 (31 December 2019: $1,343,429).

3. Net tangible assets

	Reporting period		Previous period
	Cents		Cents

Net tangible assets per ordinary security		0.14		(0.21	)

4. Control gained over entities

Not applicable.

5. Loss of control over entities

Not applicable.

6. Dividends

Current period

There were no dividends paid, recommended or declared during the current financial period.

Previous period

There were no dividends paid, recommended or declared during the previous financial period.

F-9

engage:BDR Limited

Appendix 4E

Preliminary final report

7. Dividend reinvestment plans

Not applicable.

8. Details of associates and joint venture entities

Not applicable.

9. Foreign entities

Details of origin of accounting standards used in compiling the report:

engage:BDR LLC, Tiveo LLC and AdCel LLC are wholly owned subsidiaries of engage:BDR Limited. These entities are incorporated and domiciled in the US. Accounting standards have been consistently applied to these foreign entities.

10. Audit qualification or review

Details of audit/review dispute or qualification (if any):

The financial statements have been audited and an unmodified opinion has been issued.

11. Attachments

Details of attachments (if any):

The Registration statement of engage:BDR Limited for the year ended 31 December 2020 is attached.

12. Signed

Signed		Date: 26 February 2021

	Ted Dhanik
	Executive Chairman

F-10

engage:BDR Limited

ABN 621 160 585

Registration statement - 31 December 2020

F-11

engage:BDR Limited

Contents

31 December 2020

Corporate directory	F-13
Directors’ report	F-14
Auditor’s independence declaration	F-33
Statement of profit or loss and other comprehensive income	F-35
Statement of financial position	F-36
Statement of changes in equity	F-37
Statement of cash flows	F-38
Notes to the financial statements	F-39
Directors’ declaration	F-63
Independent auditor’s report to the members of engage:BDR Limited	F-64
Shareholder information	F-72

F-12

engage:BDR Limited

Corporate directory

31 December 2020

Directors		Mr Ted Dhanik
		Mr Kurtis Rintala
		Mr Tom Anderson
		Mr Darian Pizem
		Mr Robert Antulov

Company secretary		Ms Melanie Leydin

Registered office		Scottish House
		Level 4
		90 William Street
		Melbourne Victoria 3000 Australia
		Telephone: +61 3 9692 7222

Principal place of business		8581 Santa Monica Boulevard
		#12
		West Hollywood
		California 90069 USA
		Telephone +1 310 954 0751

Share register		Computershare Investor Services Pty Limited
		Yarra Falls, 452 Johnston Street
		Abbotsford, VIC 3067
		Telephone: +61 3 9415 5000
		Fax: +61 3 9473 2500

Auditor		William Buck Audit (Vic) Pty Ltd
		Level 20, 181 William Street
		Melbourne VIC 3000
		Australia

Stock exchange listing		engage:BDR Limited securities are listed on the Australian Securities Exchange (ASX code: EN1 and EN1O).

Website		engagebdr.com

F-13

engage:BDR Limited

Directors' report

31 December 2020

The Directors present their report, together with the financial report of engage:BDR Limited comprising engage:BDR Limited (referred to hereafter as the ‘Company’ or ‘parent entity’) and the entities it controlled at the end of, or during, the year ended 31 December 2020 (referred to hereafter as ‘engage:BDR’ or the ‘Group’).

Directors

The following persons were directors of engage:BDR Limited during the whole of the financial year and up to the date of this report, unless otherwise stated:

Mr Ted Dhanik (Co-Founder and Executive Chairman)

Mr Kurtis Rintala (Co-Founder and Executive Director)

Mr Tom Anderson (Non-Executive Director)

Mr Darian Pizem (Non-Executive Director)

Mr Robert Antulov (Non-Executive Director)

Principal activities

Dividends

There were no dividends paid, recommended or declared during the current or previous financial year.

Review of operations

The loss for the consolidated entity after providing for income tax amounted to $6,881,027 (31 December 2019: loss of $1,343,429).

The Group’s operating result this year was adversely affected by the Covid 19-related global reduction in advertising spend, which resulted in a fall in revenues, while additional underlying delivery and administrative costs were incurred to support the Group’s repositioning process.

The Group’s loss was also affected by increases in non-recurrent, non-cash expenses, including losses on impairment of shares held in trust and costs of share-based payments.

Programmatic display, native and video advertising sales

The Group’s Programmatic advertising sales includes selling display, native and video advertising inventory through the Group’s digital auctioning technology to platforms and marketplaces. The adoption of programmatic display advertising sales has proven to be extremely successful in 2020 and opened additional revenue opportunities from the same clients, largely because programmatic buying and selling of advertising is much more efficient and significantly more cost effective to operate, thus increasing the Group’s overall operating and gross profit margins.

The Group’s proprietary programmatic technology significantly increases the Group’s operating margins by reducing payroll and associated sales commissions. With the rapid adoption of programmatic buying, brands, agencies and digital media buyers have moved their budgets to auction-based buying, in contrast to buying from salespeople, individual RFP (request for proposal) and insertion orders. This behavioural change has made the marketplace much more efficient, significantly reducing the staff overhead required to sell advertising in the traditional way. Per eMarketer, nearly 84.5% of display advertising was sold programmatically in 2020. The significant growth in 2020 was fuel primarily by an increase in programmatic mobile app inventory consumption as also cited by e-marketer. https://www.emarketer.com/content/us-programmatic-display-spending-will-grow-spite-of-recession. Additionally, the company’s new opportunity to service connected TV buyers is met with significant demand, with nearly 35% of buyers moving budgets from non-programmatic to programmatic buying of connected TV in 2020 alone. In 2021, per eMarketer, programmatic connected TV spend is expected to grow 52.9% over 2020. https://www.emarketer.com/content/us-programmatic-digital-display-advertising-outlook-2021

F-14

engage:BDR Limited

Directors’ report

31 December 2020

Influencer Marketing

Mobile and Connected Television (CTV) App Ads

The Group expects continued growth in supply and demand integration onboarding specifically within AdCel for 2021, as AdCel’s technology has matured to a stage in which it is capable of monetizing inventory across ConnectedTV Apps. In addition to its core competency of App monetization across mobile devices. AdCel is one of the first demand agnostic mediation technologies available for ConnectedTV publishers in the market, solving an inherent problem in the ConnectedTV ecosystem. AdCel enables publishers the unique ability to mediate multiple sources of demand in one platform, utilizing intelligent personalization powered by the AdCel machine learning algorithm to maximize yield and minimize human error and time spent performing manual optimization. As supply and demand partnerships are established and integrated by sales and engineering, revenue is expected to steadily ramp throughout the course of the year. AdCel will continue to focus onboarding significant volumes of new ConnectedTV and mobile App publishers through the group’s NetZero payment product, enabling publisher payments the same day the group is invoiced. This and other integrations refer to suppliers to direct server integrations to the publisher’s ad mediation platform, These are known as RTB (Real Time Bidding) connections. These are programmatic integrations to access supply from a set of publishers. When integrating with a mediation/supply side platform, engineers from both teams perform technical integrations to allow our platforms to query and respond to each other in real time using a universal framework knows as OpenRTB protocol. All integrations are formal partnerships and subject to contracting with each one.

Significant changes in the state of affairs

On 1 April 2020, the Company issued 38,412,579 fully paid ordinary shares for settlement of outstanding creditor balances at a deemed issue price of $0.017 (1.7 cents) per share.

●	Exercise price of $0.0201, vesting upon issue, with an expiry of 3 years after date of issue;
●	Exercise price of $0.0217, vesting 12 months after issue, with an expiry of 3 years after date of issue; and
●	Exercise price of $0.0233, vesting 24 months after issue, with an expiry of 3 years after date of issue.

F-15

engage:BDR Limited

Directors’ report

31 December 2020

The options were issued in accordance with the Company’s Options and Performance Rights Plan.