CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Notes to the Financial Statements
(Unaudited)
March 31, 2010
NOTE 3. STOCKHOLDERS' EQUITY (continued)
On April 24, 2010, Convenience TV Inc. had a forward split of Convenience TV Inc.'s issued and outstanding common stock on a 7 for 1 basis. The financial statements have been retroactively restated for the effects of the forward split.
NOTE 4. SUBSEQUENT EVENTS
On May 5, 2010, Convenience TV Inc. closed a share acquisition agreement with Global Fusion Media Inc., for the acquisition of C-Store Network, LLC. Convenience TV Inc. issued 36,000,000 post-split shares of its common stock to Global Fusion Media Inc., in connection with this closing.
Also on May 5, 2010, Convenience TV Inc. entered into and closed an agreement with its former director and officer, Rhonda Esparza, to cancel 27,800,000 post-split shares of Ms. Esparza's holdings in Convenience TV Inc.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.
Liquidity and Capital Resources
For the three months ended March 31, 2010
As of March 31, 2010 we had current assets of $3,008, current liabilities of $Nil and working capital $3,008. As of March 31, 2010 we had total assets of $3,008 comprised entirely of cash.
During the three months ended March 31, 2010 we spent net cash of $8,492 on operating activities, compared to net cash spending of $9,952 on operating activities during the same period in 2009. The decrease in operating activities for the three months ended March 31, 2010 was primarily due to decrease in professional fees associated with our public offering.
We did not spend any cash on investing activities during the three month period ending March 31, 2010 or during the same period for 2009.
During the three months ended March 31, 2010 we received net cash of $Nil from financing activities, compared to net cash received of $2,000 from financing activities during the same period in 2009. The decrease in financing activities for the three months ended March 31, 2010 was due to a lack of advances from our president.
On May 5, 2010, we closed the acquisition of C-Store Network, LLC for 36,000,000 shares of our common stock and have since adopted the business of C-Store Network, LLC, which is now our wholly-owned subsidiary. We anticipate that we will meet our ongoing cash requirements by retaining income as well as through equity or debt financing. We plan to cooperate with various individuals and institutions to acquire the financing required to produce and distribute our products and anticipate this will continue until we accrue sufficient capital reserves to finance all of our productions independently.
We estimate that our expenses over the next 12 months (beginning May 2010) will be approximately $1,702,600 as described in the table below. These estimates may change significantly depending on the nature of our future business activities and our ability to raise capital from shareholders or other sources.
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Description | Estimated
Completion Date | Estimated
Expenses
($) |
Legal and accounting fees | 12 months | 100,000 |
Marketing and advertising | 12 months | 17,600 |
Management and operating costs | 12 months | 650,000 |
Salaries and consulting fees | 12 months | 200,000 |
Fixed asset purchases | 12 months | 660,000 |
General and administrative expenses | 12 months | 75,000 |
Total | | 1,702,600 |
We intend to meet our cash requirements for the next 12 months through a combination of debt financing and equity financing by way of private placements. We currently do not have any arrangements in place to complete any private placement financings and there is no assurance that we will be successful in completing any private placement financings. If we are not able to successfully complete any private placement financings, we plan to cooperate with film and television producers or obtain shareholder loans to meet our cash requirements. However, there is no assurance that any such financing will be available or if available, on terms that will be acceptable to us. We may not raise sufficient funds to fully carry out our business plan.
Debt Cancellation
On May 5, 2010, concurrently with the closing of the acquisition of C-Store from Global Fusion, Global Fusion provided a release and debt cancellation to C-Store to eliminate all debt owed by C-Store to Global Fusion.
Share Cancellation
Also on May 5, 2010 and concurrently with the closing of the acquisition of C-Store, we entered into, and closed, an agreement with our former sole director and officer, Rhonda Esparza, pursuant to which Ms. Esparza cancelled 27,800,000 post split shares of our common stock held in her name.
Results of Operations
For the three months ended March 31, 2010 and March 31, 2009
Revenues
During the three months ended March 31, 2010, we did not earn any revenues and incurred a net loss of $8,492. During the three months ended March 31, 2009, we did not earn any revenues and incurred a net loss of $9,835.
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Expenses
During the three months ended March 31, 2010 we incurred total expenses of $8,492 which included $5,000 in legal and accounting fees, $3,000 in consulting fees and $492 in other general and administrative fees. Comparatively, during the same time in 2009, we incurred total expenses of $9,835 including $9,505 in legal and accounting fees and $303 in other general and administrative fees.
Off-Balance Sheet Arrangements
We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our stockholders.
Inflation
The effect of inflation on our revenues and operating results has not been significant.
Critical Accounting Policies
Use of Estimates. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Basic and Diluted Earnings (Loss) Per Share. The basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted net loss per common share is computed by dividing the net loss adjusted on an "as if converted" basis, by the weighted average number of common shares outstanding plus potential dilutive securities. For the three months ended March 31, 2010 and 2009, there were no potentially dilutive securities outstanding.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
ITEM 4(A). CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
We maintain "disclosure controls and procedures," as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act"), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and
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forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. We conducted an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15 of the Exchange Act. Based on this Evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our Disclosure Controls were not effective as of the end of the period covered by this report due to the material weaknesses described in Management's Report on Internal Control over Financial Reporting as reported in our Form 10-K for the year ended December 31, 2009.
Changes in Internal Controls
We have also evaluated our internal control for financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls during the quarter ended March 31, 2010.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Currently we are not aware of any litigation pending or threatened by or against the Company.
ITEM 1A. RISK FACTORS
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
On April 9, 2009, the SEC declared our Form S-1 registration statement effective (SEC File no. 333-157066) allowing us to sell 17,500,000 shares of common stock minimum, 5,000,000 shares of common stock maximum at an offering price of $0.003 per share. There was no underwriter involved in our public offering. On May 26, 2009, the Company completed its public offering by issuing 17,500,000 shares of common stock and raising $45,000, net of the legal costs of issuance of $5,000. At inception, we sold 28,000,000 shares of common stock to our sole officer and director for $40.
We have used some of the funds raised during the period for operating expenses or issuance costs as follows:
Fund raised from founder | $ | 40 |
Total funds raised from our public offering | $ | 50,000 |
Total funds raised | | 50,040 |
| | | |
Consulting Fees | $ | 21,220 |
General and Administrative | $ | 3,312 |
Legal and Accounting, includes $5,000 cost of equity issuance | $ | 22,500 |
Total remaining | $ | 3,008 |
We have not had any previously unreported issuances of unregistered securities during the period covered by this report.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. (REMOVED AND RESERVED)
ITEM 5. OTHER INFORMATION
None.
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ITEM 6. EXHIBITS
The following documents are included herein:
Exhibit No. | Document Description |
| | |
10.1 | Share Cancellation Agreement with Rhonda Esparza dated May 5, 2010 |
| | |
31.1
31.2 | Certification of Principal Executive Officer pursuant to Rule 13a-15(e) and 15d-15(e), promulgated under the Securities and Exchange Act of 1934, as amended. Certification of Principal Financial Officer pursuant to Rule 13a-15(e) and 15d-15(e), promulgated under the Securities and Exchange Act of 1934, as amended |
|
32.1
32.2 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer). Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Financial Officer). |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant and in the capacities on this 17th day of May, 2010 at Venice, California.
| | CONVENIENCE TV INC. |
| (Registrant) |
| | |
| |
/s/ NORMAN KNOWLES |
| | | Norman Knowles, President, Principal Executive Officer, and a member of the Board of Directors. /s/ GREG TREVOR
Greg Trevor, Chief Financial Officer, Principal Accounting Officer, Secretary, Treasurer, and a member of the Board of Directors. |
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EXHIBIT INDEX
Exhibit No. | Document Description |
| | |
10.1 | Share Cancellation Agreement with Rhonda Esparza dated May 5, 2010 |
| | |
31.1
31.2 | Certification of Principal Executive Officer pursuant to Rule 13a-15(e) and 15d-15(e), promulgated under the Securities and Exchange Act of 1934, as amended. Certification of Principal Financial Officer pursuant to Rule 13a-15(e) and 15d-15(e), promulgated under the Securities and Exchange Act of 1934, as amended |
|
32.1
32.2 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer). Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Financial Officer). |
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