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EX-31.1 - CERTIFICATION - Convenience TV Inc.exhibit31-1.htm
EX-32.1 - CERTIFICATION - Convenience TV Inc.exhibit32-1.htm
EX-32.2 - CERTIFICATION - Convenience TV Inc.exhibit32-2.htm
EX-31.2 - CERTIFICATION - Convenience TV Inc.exhibit31-2.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2010

or

[   ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________________ to ___________________

Commission File Number 333-157066

CONVENIENCE TV INC.
(Exact name of registrant as specified in its charter)

Nevada 30-0518293
(State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.)
   
248 Main Street, Venice, CA 90291
(Address of principal executive offices) (Zip Code)

877-943-3210
(Registrant’s telephone number, including area code)

N/A
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
[X] YES    [   ] NO

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
[   ] YES    [   ] NO

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

Large accelerated filer [   ]   Accelerated filer                    [   ]
Non-accelerated filer   [   ] (Do not check if a smaller reporting company) Smaller reporting company  [X]
   

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 PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.
[   ] YES    [   ] NO

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
55,870,000 common shares issued and outstanding as of November 19, 2010

1


CONVENIENCE TV INC.

FORM 10-Q
September 30, 2010
INDEX

PART I – FINANCIAL INFORMATION 3
       
ITEM 1. FINANCIAL STATEMENTS 3
       
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 10
       
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK 12
       
ITEM 4. CONTROLS AND PROCEDURES 12
       
PART II. OTHER INFORMATION 13
       
ITEM 1. LEGAL PROCEEDINGS 13
       
ITEM 1A. RISK FACTORS 13
       
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 13
       
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 13
       
ITEM 4. [REMOVED AND RESERVED] 13
       
ITEM 5. OTHER INFORMATION 13
       
ITEM 6. EXHIBITS 13

2


PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Our unaudited interim consolidated financial statements for the six month period ended September 30, 2010 form part of this quarterly report. They are stated in United States Dollars (US$) and are prepared in accordance with United States generally accepted accounting principles.

3


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
September 30, 2010
(Expressed in US dollars)
(unaudited)

  Index
Consolidated Balance Sheets F–1
Consolidated Statements of Operations F–2
Consolidated Statements of Stockholders’ Equity (Deficit) F–3
Consolidated Statements of Cash Flows F–4
Notes to the Consolidated Financial Statements F–5


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Consolidated Balance Sheets
(Expressed in US Dollars)

    September 30,     March 31,  
    2010     2010  
    (unaudited)        
         
             
ASSETS            
             
Current Assets            
             
   Cash   135,819      
   Prepaid expenses       8,457  
             
Total Current Assets   135,819     8,457  
             
Property and equipment (Note 3)   63,038     89,078  
             
Total Assets   198,857     97,535  
             
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)            
             
Current Liabilities            
             
   Accounts payable   27,765     5,769  
   Accrued liabilities   3,305     1,137  
   Due to Global Fusion Media Inc. (Note 5)       385,561  
             
Total Liabilities   31,070     392,467  
             
Nature of Operations and Continuance of Business (Note 1)            
Commitment (Note 7)            
             
Stockholders’ Equity (Deficit)            
             
Common Stock            
   Authorized: 100,000,000 common shares, $0.00001 par value 
   Issued and outstanding: 56,070,000 shares (March 31, 2010 – 36,000,000)
  561     1  
Additional paid-in capital   742,900      
Deficit accumulated during the development stage   (575,674 )   (294,933 )
             
Total Shareholders' Equity (Deficit)   167,787     (294,932 )
             
Total Liabilities and Shareholders' Equity (Deficit)   198,857     97,535  

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

F-1


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Consolidated Statements of Operations
(Expressed in US Dollars)
(unaudited)

                            Accumulated From  
    Three Months     Three Months     Six Months     Six Months     March 31, 2008  
    Ended     Ended     Ended     Ended     (date of inception) to  
    September 30,     September 30,     September 30,      September 30,     September 30,  
    2010     2009     2010     2009     2010  
    $     $     $     $     $  
                               
Revenue                   14,326  
                               
Expenses                              
   Amortization   13,092     12,789     26,041     25,729     92,779  
   Consulting fees   8,300         11,300     6,000     17,800  
   Content services                   6,470  
   Foreign exchange loss (gain)   228     15,026     (2,800 )   29,273     16,955  
   Investor relations   90,000         90,000         90,000  
   Management fees (Note 5)   34,000         50,000         172,305  
   Network management   28,117         57,573     5,000     103,334  
   Office and general   3,518         4,099     126     8,137  
   Professional fees   33,346     4,500     38,006     4,500     51,974  
   Transfer agent and filing fees   3,401         6,522         6,522  
   Travel and promotion               4,293     23,724  
Total Expenses   214,002     32,315     280,741     74,921     590,000  
Net Loss for the Period   (214,002 )   (32,315 )   (280,741 )   (74,921 )   (575,674 )
                               
Net Loss Per Share - Basic and Diluted           (0.01 )          
                               
Weighted Average Shares Outstanding   55,673,000     36,000,000     51,242,000     36,000,000        

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

F-2


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Consolidated Statements of Stockholders’ Equity (Deficit)
(Expressed in US Dollars)
(unaudited)

                      Deficit        
                      Accumulated        
                Additional     During the        
    Shares     Paid-in     Development        
          Amount     Capital     Stage     Total  
    #     $     $     $     $  
                               
Balance, March 31, 2008 (date of inception)                    
                -              
Shares issued   36,000,000     360     (359 )       1  
Net loss for the year               (179,591 )   (179,591 )
Balance, March 31, 2009   36,000,000     360     (359 )   (179,591 )   (179,590 )
Net loss for the year               (115,342 )   (115,342 )
Balance, March 31, 2010   36,000,000     360     (359 )   (294,933 )   (294,932 )
May 5, 2010 – recapitalization transactions                    
  Shares of Convenience TV
   Inc., net of shares cancelled
  17,700,000     177     (10,615 )       (10,438 )
   Forgiveness of related party debt           385,198         385,198  
Shares issued per private placements   1,770,000     18     278,682         278,700  
Shares issued per investor relations agreement   600,000     6     89,994         90,000  
Net loss for the period               (280,741 )   (280,741 )
Balance, September 30, 2010   56,070,000     561     742,900     (575,674 )   167,787  

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

F-3


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Consolidated Statements of Cash Flows
(Expressed in US Dollars)
(unaudited)

                Accumulated From  
    Six Months     Six Months     March 31, 2008  
    Ended     Ended     (date of inception) to  
    September 30,     September 30,     September 30,  
    2010     2009     2010  
    $     $     $  
                   
Operating Activities                  
   Net loss   (280,741 )   (74,921 )   (575,674 )
  Adjustments to reconcile net loss to net cash used in
  operating activities:
           
       Amortization   26,040     25,729     92,778  
       Shares issued for investor relations services   90,000         90,000  
   Changes in operating assets and liabilities:                  
       Prepaid expenses   8,457          
       Accounts payable   21,503     (8,613 )   27,272  
       Accrued liabilities   2,168         3,305  
       Due to related party       (760 )    
Net Cash Used In Operating Activities   (132,573 )   (58,565 )   (362,319 )
Investing Activities                  
   Acquisition of property and equipment       (8,005 )   (155,816 )
   Net cash acquired on acquisition of subsidiary   6,755         6,755  
Net Cash Provided By (Used In) Investing Activities   6,755     (8,005 )   (149,061 )
Financing Activities                  
   Advances from Global Fusion Media Inc.       66,570     346,021  
   Proceeds from issuance of common stock   278,700         278,701  
Net Cash Provided by Financing Activities   278,700     66,570     624,722  
Effect of Exchange Rate Changes on Cash   (17,063 )       22,477  
Change in Cash   135,819         135,819  
Cash, Beginning of Period            
Cash, End of Period   135,819         135,819  
                   
Supplemental Disclosures:                  
   Interest paid            
   Income taxes paid            

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

F-4


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 2010
(Expressed in US dollars)
(unaudited)

1.

Nature of Operations and Continuance of Business

   

Convenience TV Inc. (the “Company”) was incorporated under the laws of the State of Nevada on December 8, 2008. On April 24, 2010, the Company changed its name from Costa Rica Paradise Inc. to Convenience TV Inc. The Company’s prior business was real estate investment consulting with respect to properties located in Costa Rica. Upon completion of an acquisition agreement with Global Fusion Media Inc. (“Global Fusion”), as described below, the Company adopted the business of C-Store Network, LLC (“C-Store”). The Company is a development stage company, as defined by Accounting Standards Codification (“ASC”) 915, Development Stage Entities and is now engaged in the business of providing advertising services through a network of in-location televisions installed at various convenience store locations.

   

On May 5, 2010, the Company closed an acquisition agreement with Global Fusion in which the Company acquired C-Store, a private company fully owned by Global Fusion, in exchange for the issuance of 36,000,000 shares of common stock to Global Fusion. Refer to Note 4.

   

These financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has not generated significant revenues since inception and is unlikely to generate significant revenue or earnings in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations. As at September 30, 2010, the Company has not generated significant revenues and has an accumulated deficit of $575,674 since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern

   

The Company will need additional working capital to continue or to be successful in any future business activities. Management plans to seek debt or equity financing, or a combination of both, to raise the necessary working capital.

   
2.

Summary of Significant Accounting Principles

   

Basis of Presentation

   

These financial statements are prepared in conformity with accounting principles generally accepted in the United States and are presented in US dollars, unless otherwise noted. The Company’s fiscal year end is March 31.

   

Interim Financial Statements

   

The interim unaudited financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future.

   

Use of Estimates

   

The preparation of financial statements in conformity with US 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. The Company regularly evaluates estimates and assumptions related to the useful life and recoverability of long-lived assets. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

F-5


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 2010
(Expressed in US dollars)
(unaudited)

2.

Summary of Significant Accounting Principles (continued)

   

Property and Equipment

   

Property and equipment, consisting primarily of computer and equipment, is stated at cost and is amortized using the straight- line method over their estimated lives of three years.

   

Revenue Recognition

   

The Company recognizes revenue in accordance with ASC 605, Revenue Recognition. Revenue consists of streaming advertising services. Revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed, and collectability is reasonably assured.

   

Impairment of Long-lived Assets

   

In accordance with ASC 360, Impairment or Disposal of Long-Lived Assets, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.

   

Foreign Currency Translation

   

The Company’s functional currency and its reporting currency is the United States dollar and foreign currency transactions are primarily undertaken in Canadian dollars. Monetary balance sheet items expressed in foreign currencies are translated into US dollars at the exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are translated at historical rates. Revenues and expenses are translated at average rates for the period. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.

   

Comprehensive Loss

   

ASC 220, Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at September 30, 2010 and 2009, the Company had no items representing comprehensive loss.

   

Income Taxes

   

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

F-6


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 2010
(Expressed in US dollars)
(unaudited)

2.

Summary of Significant Accounting Principles (continued)

   

Financial Instruments and Fair Value Measures

   

ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments require an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist principally of cash, accounts payable and accrued liabilities. Pursuant to ASC 820, the fair value of cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

Recent Accounting Pronouncements

In October 2009, the Financial Accounting Standards Board (“FASB”) issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminated the use of the residual method for allocating arrangement considerations and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect the timing or amount of revenue recognition. This standard will be adopted on April 1, 2011 but is not expected to have a material effect on the Company’s consolidated financial statements.

In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the product’s essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard will be adopted on April 1, 2011 but is not expected to have a material effect on the Company’s consolidated financial statements.

In January 2010, the FASB issued an amendment to ASC 820, Fair Value Measurements and Disclosures, to require reporting entities to separately disclose the amounts and business rationale for significant transfers in and out of Level 1 and Level 2 fair value measurements and separately present information regarding purchase, sale, issuance, and settlement of Level 3 fair value measures on a gross basis. The adoption of this standard on April 1, 2010, with the exception of disclosures regarding the purchase, sale, issuance, and settlement of Level 3 fair value measures which are effective for fiscal years beginning after December 15, 2010, did not have a material effect on the Company’s consolidated financial statements. The adoption of the remainder of the standard is not expected to have a material effect on the Company’s consolidated financial statements

F-7


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 2010
(Expressed in US dollars)
(unaudited)

2.

Summary of Significant Accounting Principles (continued)

   

Recent Accounting Pronouncements (continued)

   

In February 2010, the FASB issued Accounting Standards Update 2010-10 (“ASU 2010-10”), “Consolidation (Topic 810): Amendments for Certain Investment Funds”. The amendments in this update are effective as of the beginning of a reporting entity’s first annual period that begins after November 15, 2009 and for interim periods within that first reporting period. Early application is not permitted. The Company’s adoption of provisions of ASU 2010-10 did not have a material effect on the Company’s consolidated financial statements.

   

In March 2010, the FASB issued Accounting Standards Update 2010-11 (ASU 2010-11), “Derivatives and Hedging (Topic 815): Scope Exception Related to Embedded Credit Derivatives”. The amendments in this update are effective for each reporting entity at the beginning of its first fiscal quarter beginning after June 15, 2010. Early adoption is permitted at the beginning of each entity’s first fiscal quarter beginning after issuance of this update. The Company does not expect the provisions of ASU 2010-11 to have a material effect on the Company’s consolidated financial statements.

   

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

   
3.

Property and Equipment


                  September 30,     March 31,  
                  2010     2010  
            Accumulated     Net Carrying     Net Carrying  
      Cost     Amortization     Value     Value  
      $     $     $     $  
  Computer equipment   16,147     11,947     4,200     6,899  
  Equipment   139,669     80,831     58,838     82,179  
                           
      155,816     92,778     63,038     89,078  

4.

Acquisition of C-Store Network, LLC

     

On April 1, 2010, the Company entered into an acquisition agreement (the “Acquisition Agreement”) with Global Fusion Media Inc. ("Global Fusion"), a company incorporated under the laws of British Columbia, Canada. The Company agreed to acquire 100% of C-Store Network, LLC ("C-Store") from Global Fusion in exchange for 36,000,000 shares of common stock (the "Acquisition"). On May 5, 2010 the transactions contemplated by the Acquisition Agreement closed. C-Store is a media and advertising company which focuses on direct advertising to customers in convenience stores through North America.

     

Global Fusion held 67% of the total issued and outstanding common shares of the Company immediately following the Acquisition. The Acquisition was a capital transaction in substance and therefore has been accounted for as a recapitalization, which is outside the scope ASC 805, Business Combinations. Under recapitalization accounting, C-Store is considered the acquirer for accounting and financial reporting purposes, and acquired the assets and assumed the liabilities of the Company. Assets acquired and liabilities assumed are reported at their historical amounts. These consolidated financial statements include the accounts of the Company since the effective date of the recapitalization and the historical accounts of the business of C-Store since inception.

     
5.

Related Party Transactions

     
a)

As at March 31, 2010, C-Store owed $178,127 and $207,434 (Cdn$210,712) to Global Fusion for expenditures paid on behalf of C-Store. These amounts were unsecured, non-interest bearing and due on demand. On May 5, 2010, concurrently with the closing of the Acquisition as described in Note 4, Global provided a release and debt cancellation to eliminate all debt owed by C-Store to Global. As Global was the sole owner of C-Store prior to the closing of the Acquisition, $385,198 was recorded as additional paid-in capital.

F-8


CONVENIENCE TV INC.
(formerly Costa Rica Paradise Inc.)
(A Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 2010
(Expressed in US dollars)
(unaudited)

5.

Related Party Transactions (continued)

     
b)

During the six months ended September 30, 2010, the Company paid $25,000 (2009 - $nil) in management fees to a company controlled by the President of the Company.

     
c)

During the six months ended September 30, 2010, the Company paid $25,000 (2009 - $nil) in management fees to the Chief Financial Officer of the Company.

     
6.

Common Stock

     
a)

On May 4, 2010, the Company effected a one for seven forward stock split of the issued and outstanding shares of common stock. All share amounts of the Company have been retroactively adjusted for all periods presented.

     
b)

On May 5, 2010, 27,800,000 shares of common stock held by the former President of the Company were returned and cancelled for no consideration.

     
c)

On May 5, 2010, the Company issued 36,000,000 shares of common stock for the acquisition of C-Store. Refer to Note 4.

     
d)

On July 1, 2010, the Company issued 520,000 shares of common stock at $0.055 per share for proceeds of $28,700.

     
e)

On July 22, 2010, the Company issued 1,250,000 shares of common stock at $0.20 per share for proceeds of $250,000.

     
f)

On August 3, 2010, the Company issued 600,000 shares of common stock with a fair value of $90,000 pursuant to an investor relations agreement entered into on August 1, 2010. Refer to Note 7.

     
7.

Commitment

     

On August 1, 2010, the Company entered into an investor relations agreement. Pursuant to the agreement, the Company agreed to pay a fee of $2,500 per month for a period of six months, and issue 600,000 shares of common stock within seven days of signing the agreement. On August 3, 2010, the Company issued 600,000 shares of common stock pursuant to the agreement.

F-9


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.

As used in this quarterly report, the terms "we", "us", "our company", mean Convenience TV Inc. a Nevada corporation, unless otherwise indicated.

Liquidity and Capital Resources

For the six months ended September 30, 2010

As of September 30, 2010 we had current assets of $135,819, current liabilities of $31,070 and working capital of $104,749. As of September 30, 2010 we had total assets of $198,857 comprised of cash of $135,819 and property and equipment of $63,038.

During the six months ended September 30, 2010 we spent net cash of $132,573 on operating activities, compared to net cash spending of $58,565 on operating activities during the same period in 2009.

Net cash provided by investing activities for the six months ended September 30, 2010 was $6,755 compared to net cash used in investing activities of $(8,005) during the same period in 2009.

During the six months ended September 30, 2010 we received net cash of $278,700 from financing activities, compared to net cash received of $66,570 from financing activities during the same period in 2009.

On May 5, 2010 we closed the acquisition of C-Store Network, LLC 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 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.

  Estimated Estimated
Description Completion Date 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

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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 also 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 six months ended September 30, 2010 and September 30, 2009

Revenues

During the six months ended September 30, 2010 we did not earn any revenues and incurred a net loss of $280,741. During the six months ended September 30, 2009 we did not earn any revenues and incurred a net loss of $74,921.

Expenses

During the six months ended September 30, 2010 we incurred total expenses of $280,741 which included $38,006 in professional fees, $11,300 in consulting fees, $50,000 in management fees, $90,000 in investor relations, $57,573 in network management, and $26,041 in amortization. Comparatively, during the same time in 2009, we incurred total expenses of $74,921 which included $4,500 in professional fees, $6,000 in consulting fees, $29,273 in foreign exchange loss, $5,000 in network management, and $25,729 in amortization.

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.

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Critical Accounting Policies

Revenue Recognition

We recognize revenue in accordance with ASC 605, Revenue Recognition. Revenue consists of streaming advertising services. Revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed, and collectability is reasonably assured.

Impairment of Long-lived Assets

In accordance with ASC 360, Impairment or Disposal of Long-Lived Assets, we test long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

We are a smaller reporting company and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and 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. Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls were effective as of the end of the period covered by this report.

Changes in Internal Controls

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended September 30, 2010 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, executive officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS

We are a smaller reporting company and are not required to provide the information under this item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

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.

ITEM 6. EXHIBITS

Exhibit No. Document Description
   
(2)

Plan of acquisition, reorganization, arrangement, liquidation or succession

2.1

Acquisition Agreement with Global Fusion Media Inc., dated April 1, 2010 (incorporated by reference to our Current Report on Form 8-K filed on May 11, 2010).

 

(3)

(i) Articles of Incorporation; (ii) By-laws

3.1

Certificate of Amendment filed with the Nevada Secretary of State on May 4, 2010 (incorporated by reference to our Current Report on Form S-1 filed on February 2, 2009.

3.2

Articles of Incorporation of Convenience TV Inc. (formerly Costa Rica Paradise Inc.) (incorporated by reference to our Current Report on Form S-1 filed on February 2, 2009).

3.3

By-laws of Convenience TV Inc. (formerly Costa Rica Paradise Inc.) (incorporated by reference to our Current Report on Form S-1 filed on February 2, 2009).

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(10)

Material Contracts

10.1

Acquisition Agreement between the company (formerly Costa Rica Paradise Inc.) and Global Fusion Media Inc. dated April 1, 2010 (incorporated by reference to our Current Report on Form 8-K filed on April 9, 2010).

10.2

Share Cancellation Agreement with Rhonda Esparza dated May 4, 2010 (incorporated by reference to our Current Report on Form 10-Q filed on May 18, 2010).

 

(31)

Rule 13a-14(a)/15d-14(a) Certifications

31.1*

Section 302 Certifications under Sarbanes-Oxley Act of 2002 of Norman Knowles (Chief Executive Officer).

31.2*

Section 302 Certifications under Sarbanes-Oxley Act of 2002 of Greg Trevor (Chief Financial Officer and Chief Accounting Officer).

 

(32)

Section 1350 Certifications

32.1*

Section 906 Certifications under Sarbanes-Oxley Act of 2002 of Norman Knowles (Chief Executive Officer).

32.2*

Section 906 Certifications under Sarbanes-Oxley Act of 2002 of Greg Trevor (Chief Financial Officer and Chief Accounting Officer).

* Filed herewith.

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SIGNATURES

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

  CONVENIENCE TV INC.
   
   
   
Date: November 22, 2010 /s/ Norman Knowles
  Norman Knowles
  President, Principal Executive Officer and Director
   
   
   
   
Date: November 22, 2010 /s/ Greg Trevor
  Greg Trevor
  Chief Financial Officer, Principal Accounting
  Officer, Secretary, Treasurer and Director

15